Looking for votes in all the wrong places

February 4, 2009

The Republicans' criticisms of fiscal stimulus legislation are based on their opposition to any government program that isn't ultimately aimed at putting money in the pockets of the rich. So, asks Alan Maass, why is Barack Obama reaching out to them?

THEY GOT blown out in the last two elections. From control of both houses of Congress and the White House, they now control none of the above. They nearly put their party's leadership body in the hands of a man who sees nothing wrong with a song called "Barack the Magic Negro." And the closest thing they have to a national spokesperson is talk radio jackass Rush Limbaugh.

So why are the Republicans dominating the mainstream debate about the top issue in U.S. politics: economic stimulus legislation. And why--why, why, why?--is the Obama administration letting them?

Two weeks after Washington was packed with millions of people celebrating the inauguration of Obama and the beginning of a new era with Democrats in charge, the Republicans--incredibly--have momentum on their side in national politics.

Yesterday, a second appointment to Obama's Cabinet collapsed in scandal: Tom Daschle, the former leader of the Democrats in the Senate and one of the earliest backers of Obama's presidential campaign among the party establishment, withdrew his name after revelations that he failed to pay $146,000 in taxes, most of it on perks he got from a corporate benefactor. The revelations were a major embarrassment for an administration that promised to hold officials to higher standards of conduct.

Republican Sen. Lindsey Graham meets with President Barack Obama
Republican Sen. Lindsey Graham meets with President Barack Obama (Alex Wong | CNP)

The ethically challenged Republicans--though up to their necks in scandal themselves throughout eight years of George Bush--had a field day.

But when they weren't smirking about Daschle, Republicans were filling the airwaves with complaints about the nearly $900 billion economic stimulus package and lectures about the need for more tax cuts for business as the solution to the crisis.

And the mainstream media and the Obama administration let them get away with it.

Now, after a House vote in which every single Republican opposed the stimulus package, the Senate has taken up the proposal, and a group of Republicans and conservative Democrats are reshaping important parts of the legislation to their liking.

IT'S ALL taking place with Obama's blessing. Since before taking office, Obama has been vowing to cooperate with Republicans in the spirit of "bipartisanship." "I've done extraordinary outreach, I think, to Republicans, because they had some good ideas," Obama said about the stimulus bill. "And I want to make sure that those ideas are incorporated."

Actually, "those ideas" already were incorporated. The administration's own proposal was unexpectedly weighted toward tax breaks--accounting for more than a third of the total, even though economists warn that government spending, rather than tax credits, is much more effective in spurring economic activity.

All this has given up the political advantage to the Republicans. "If achieving bipartisanship takes priority over the actual content of policy, Republicans are handed a powerful weapon," wrote Washington Post columnist E.J. Dionne.

For one thing, the Republicans have been successful in defining the stimulus legislation on their terms. Mainstream media accounts now regularly repeat the GOP talking point that the proposal is "a pork-stuffed monstrosity," in the words of an ABC News report.

The Republicans are using a tried-and-true tactic in opposing big spending measures--focus in on a handful of provisions that can be mocked (mostly, though not always, with justification) as absurd boondoggles, and then smear the whole bill as a waste of money. Meanwhile, the much larger sums devoted to priorities Republicans approve of--like tax breaks--go unexamined.

Some congressional Democrats have pointed out the Republicans' selective opposition to pork, but Obama and his administration haven't. On the contrary, they're encouraging the bipartisan team of senators to trim "things that are not relevant to putting people back to work right now," Obama said.

This dynamic has had an effect on public opinion. Obama's approval rating remains high, and so does support for some form of stimulus legislation to pass Congress quickly. But support for the legislation as it stands has dropped to 38 percent--with nearly as large a group favoring "major changes" to the Democrats' proposal before it passes.

THE OBAMA administration's appeals to bipartisanship aren't just a political tactic that backfired.

There has always been a gap between Obama's rhetorical promise of change and the actual policies he favors, which belong squarely in the mainstream of the Democratic Party.

The new administration's economics team is filled with veterans of the Clinton administration, who in the 1990s championed the pro-free market agenda known as neoliberalism, though usually with a "kinder and gentler" face on it than Republicans.

The depth of today's economic crisis may have forced these Clintonites to consider new options, "just as patients hear advice regarding diet and exercise differently after a heart attack," as Larry Summers, a Clinton-era Treasury Secretary and head of Obama's National Economic Council, wrote in the Financial Times. But they are also drawn to the old dogmas and prescriptions.

The administration's attitude toward stimulus legislation shows the signs of being pulled in these opposing directions.

The size of the measure has swelled as the depth of the crisis became apparent in recent months. But it still isn't big enough, according to many economists, to have the needed effect. And the prominence of the tax cuts shows not only Obama's willingness to placate Republicans, but his administration's commitment to the favored policy option under neoliberalism.

Unlike the Bush-era tax cuts whose main benefits went to the super-rich, the Obama administration's proposals are more likely to help working people--including a reduction in payroll taxes taken out of every employee's paycheck, though the effect will be less than people might guess.

But tax cuts in any form aren't as effective as government spending in stimulating the economy. That was proven again last year by the anemic effect of the tax rebate pushed through by the Bush administration--by all accounts, most people used their checks to pay off debts, or put the money in the bank.

This is even more true about the range of business tax cuts in the stimulus package. Companies faced with declining markets aren't likely to use the proceeds of tax breaks to invest if they don't have profitable investment opportunities. Meanwhile, the cuts starve the government of needed revenue.

The effects of government spending are much more reliable. For example, according to economists, every dollar added to the government food stamp program generates $1.73 in economic activity.

In other words, a tangible return. But these are precisely the kind of provisions in the stimulus package that Republicans are targeting as wasteful.

As Josh Marshall wrote on the liberal Talking Points Memo Web site:

[Obama] needs to make this argument, which he's not. Absent that, we can't be surprised, and the Democrats are not in much of a position to complain, if the vacuum is filled by a bunch of Republicans making statements that are either demonstrable nonsense or just lies...Without a clear argument about why this whole exercise is necessary, it's inevitable that the debate will be ground down to the inconsequential minutiae, which is the aim of its opponents.

Obama could use his huge popularity to appeal over the Republicans' heads and challenge their distortions. It's not like the GOP has a swelling base of popular support. A CNN/Opinion Research Corp. poll last month asked people who they wanted controlling Congress--and the Democrats led with a 56 percent to 31 percent advantage, an overwhelming gap.

Yet Obama keeps making concessions in the name of bipartisanship.

The stimulus legislation will pass Congress--sooner or later, in one form or another--and it will be greeted with enthusiasm by millions of people who fear where the economy is headed. But pay close attention to the tradeoffs when it does. As E.J. Dionne wrote:

Obama placed a heavy bet during his campaign on a promise to reform the heath care system. To the great consternation of conservatives, the House stimulus bill takes big steps toward broadening the number of Americans government would help to obtain health insurance. Will those provisions be protected in the final bill?

The president has spoken passionately about the inadequacy of our schools and the increasing difficulty young Americans are having in affording higher education. The House stimulus bill includes a lot of education money. Will students be thrown over the side in pursuit of a nebulous cross-party comity?

Whatever the final shape of the stimulus bill, Obama has already conceded much more than he needed to--and not merely because he pursued a mistaken political tactic of bipartisanship, but because he is much more of a moderate and conventional politician than his rhetoric led millions of supporters to believe. That will be an important lesson to remember for everyone who wants to build an alternative to the status quo in Washington.

Further Reading

From the archives