Monday, October 21, 2013

Democrats Need to Go on The Offensive

Despite the travesty of the Republican led government shutdown the GOP is still controlling the debate in Washington.As George Packer writes in the New Yorker"These days, Republicans may be losing politically and resorting to increasingly anti-majoritarian means—gerrymandering, filibuster abuse, voter suppression, activist Supreme Court decisions, legislative terrorism—to nullify election results. But on economic-policy matters they are setting the terms. Senator Ted Cruz can be justly described as a demagogic fool, but lately he’s been on the offensive far more than the White House has. The deficit is in fairly precipitous decline, but job growth is anemic, and millions of Americans remain chronically unemployed. Democrats control the White House and the Senate, and last year they won a larger share of the national vote in the House than Republicans did. And yet the dominant argument in Washington is over spending cuts, not over ways to increase economic growth and address acute problems like inequality, poor schools, and infrastructure decay."As Larry Summers has stated recently in the Financial Times" budget deficits are now a second-order problem relative to more pressing issues facing the US economy. Projections that there is a major deficit problem are highly uncertain. And policies that indirectly address deficit issues by focusing on growth are sounder economically and more plausible politically than the long-term budget deals with which much of the policy community is obsessed. The latest Congressional Budget Office projection is that the federal deficit will fall to 2 per cent of GDP by 2015 and that a decade from now the debt-to-GDP ratio will be below its current level of 75 per cent. While the CBO projects that under current law the debt-to-GDP ratio will rise over the longer term, the rise is not large relative to the scale of the US economy. It would be offset by an increase in revenues or a decrease in spending of 0.8 per cent of GDP for the next 25 years and 1.7 per cent of GDP for the next 75 years."So why the disconnect between the political conversation that should be dominated by facts and not by Republican talking points?   A lack of White House leadership seems the best explanation.  As Maureen Dowd puts it well in yesterday's New York Times, this is a President who is too fond of being above the fray,"Obama’s default position is didactic disdain. He underuses the fear and charm cards. When he first saw the White House movie theater, he was surprised there were so many seats beyond what the first family would need. Bill Clinton, on the other hand, probably would have built a balcony and auctioned off seats, if he could have.As Valerie Jarrett told David Remnick in “The Bridge,” Obama’s “uncanny” abilities need to be properly engaged, or he disengages. “He’s been bored to death his whole life,” she said. “He’s just too talented to do what ordinary people do.”The worst part about the situation is that the White House will not allow other talented people do anything either.  Perhaps they are too caught up in the health care exchange failure but this cannot be the entire explanation. The President so controls the message that they will not allow other potential spokespeople, notably his Secretary of Labor to take center stage in the way that Robert Reich was allowed to do in the Clinton administration. The Democrats in Congress too seem in a cowering position as if they just want the Republicans to return to the old centrist party they once were and feel they might get rewarded for good behavior if they play on their turf.  If Obama is really serious about preserving jobs and growing the economy he should repeat over and over again that the deficit is not the issue, the problem is growth. He should be out front on this debate instead of gaming the next potential shutdown in January when Republicans will demand cuts in social programs and refuse to allow tax increases on billionaires. You cannot win when you don't engage.