The sorrow and the pity of Obama’s budget
Pity Barack Obama. Everything in his life experience prepared him to be the president who would take on the big challenge of the 21st century: rising income inequality and the hollowing out of the middle class.
His peripatetic youth taught him about the price of plutocracy. In an interview unearthed by Zachary A. Goldfarb of the Washington Post, in 1995 Barack Obama, plugging his autobiography, “Dreams From My Father,” recalled that experience for the Hyde Park Citizen, his neighborhood edition of a newspaper that bills itself as the “Premiere African American Weekly” in Chicago.
“My travels made me sensitive to the plight of those without power and the issues of class and inequalities as it relates to wealth and power,” he said.
“Anytime you have been overseas in these so-called Third World countries, one thing you see is a vast disparity of wealth of those who are part of the power structure and those outside of it.”
As an adult, he didn’t take the obvious and lucrative path for an editor of the Harvard Law Review: a high-flying Wall Street career. Instead, Obama returned to Chicago and continued to focus on the issues of the underclass he had first addressed there as a community organizer.
Obama’s swift political ascent soon propelled him back into the world of the plutocrats, but even as he was pocketing their donations, he worried about coming to share their worldview.
In “The Audacity of Hope,” his second book, Obama writes that the financiers and lawyers who backed his 2004 run for the Senate were “smart, interesting people” who weren’t looking for a quid pro quo for backing him.
Even so, Obama feared that hanging out too much with the super-rich would skew his perspective. He was concerned, he wrote, about losing sight of the “frequent hardship of the other 99 percent of the population — that is, the people that I’d entered public life to serve.”
It is worth noting that Obama was writing about the 99 percent in 2006 — well before the Occupy Wall Street movement introduced that term into our collective discussion and before Obama’s presidential campaign introduced him into the national debate.
All of which meant that when Obama got to the most powerful political office in the world, he arrived intellectually and psychically equipped to take on the issue that America’s leading economists — and, being a wonk, Obama consulted many of them — were, at that moment, identifying as the big new economic fact of our time.
As things turned out, Obama didn’t start his presidency by addressing income inequality head-on: The small matter of a global financial crisis had to be taken care of first. But even in the face of the gravest economic meltdown since the Great Depression, Obama pressed on with one of his key initiatives to level America’s playing field: healthcare reform.
That drive, which cost so much political capital and yielded such a complex, emotionally unsatisfying result, is critical evidence of Obama’s commitment to the 99 percent: Healthcare had been the big missing piece in America’s social safety net, a gap that became more dangerous as incomes and job security deteriorated for the middle class.
To understand the significance of Obama’s healthcare drive, it is worth remembering that there was another huge item still left on the liberal to-do list that a different president might have focused on: climate change. Among the president’s affluent backers, the green agenda trumped everything else, but for Americans experiencing “frequent hardship” the financial devastation of medical bills was the more urgent problem, hence Obama’s choice.
In 2012, Obama campaigned on his willingness to name inequality as the problem, and won on his promise to fix it: “What drags down our entire economy,” he said last spring, “is when there is an ultrawide chasm between the ultrawealthy and everyone else.”
With this week’s budget plan, Obama made good on that pledge. In the apt summary of Derek Thompson of The Atlantic, the haiku version of the president’s proposal is “tax the rich, spare the poor, remember the young.”
He wants to raise taxes at the top, including closing some of the loopholes that have enriched the plutocrats; help the poor, with measures like increasing the minimum wage; and increase opportunity for the young, with early childhood education.
Put these measures together with healthcare reform, recall the current American aversion to taxes and the country’s sorry fiscal state, and this amounts to a rather muscular attack on income inequality.
That’s where the pity comes in. Within the constraints of American politics and the American economy, Obama is addressing the issue he cares about most with a lot of energy. The tragedy is that the problem is still getting worse.
Wall Street has surged to pre-crisis highs, even as median incomes stagnate. At the very, very top, incomes are higher, and wealth is greater, than ever before. But for the 99 percent, unemployment remains crippling, and perhaps even more worryingly, the jobs that are coming back aren’t as good as the jobs they are replacing.
As Annie Lowrey of the New York Times has pointed out, the National Employment Law Project did a study last year that showed lower-wage occupations were 21 percent of recession losses, but 58 percent of recovery growth. Meanwhile, mid-wage jobs were 60 percent of recession losses – but only 22 percent of recovery growth.
The problem is not, as the left sometimes complains, that Obama doesn’t care or that he isn’t trying hard enough. It is that the issue he has long been focused on has become more deeply entrenched and harder to fix over the past three decades. A diagnosis isn’t enough; doing something about it requires transformational leadership and a transformational agenda. Liberals need their own Margaret Thatcher, and they haven’t found her yet.