A recent Rolling Stone issue caught my eye because it gets to the heart of sharp divide in the Democratic party. Will we reclaim our mantle as the party of the people or will we allow ourselves to descend into irrelevance out fear and subservience to the self-proclaimed "Masters of the Universe?"
The following is an excerpt from a Rolling Stone Round Table discussion:
In 2008, Obama managed to win over both the financial sector and the progressive wing of the Democratic Party. Now he seems to have pissed off both ends of that coalition.
Hart: There’s a fascinating point from the exit polls that supports part of what Matt is saying. When you ask voters who is most to blame for the current economic crisis, 35 percent say it’s Wall Street bankers, 29 percent say it’s George W. Bush and 23 percent say it’s Barack Obama. However, among those who say it’s Wall Street bankers, 56 percent voted for the Republicans in this election. So go figure.
That said, I worry that if the president and the Democrats were to follow Matt’s advice, they would be appealing to the smallest segment of the electorate. Right now Obama has the support of 85 percent of Democrats. If you want to get America back to work, you don’t want to put the people who have the ability to invest on the other side of their fence.
Taibbi: So if we put people in jail for committing fraud during the mortgage bubble, we’re endangering our ability to win over the CEOs? Obama should have made sure that there are consequences for people who committed crimes. Instead, he pursued a policy of nonaction, and that left him vulnerable with ordinary people who wanted an explanation for why the economy went off the cliff.
Gergen: I don’t think his problem is he hasn’t put enough people in jail. I agree that when people commit fraud, they ought to spend some time in the slammer. But there’s a tendency in today’s Democratic Party to turn away from someone like Bob Rubin because of his time at Citigroup. I served with him during the Clinton administration, when the country added 22 million new jobs, and Bob Rubin was right at the center of that. He was an invaluable adviser to the president, and he is now arguing that one of the reasons this economy is not coming back is that the business community is sitting on money because of the hostility they feel coming from Washington.
Taibbi: I’m sorry, but Bob Rubin is exactly what I’m talking about. Under Clinton, he pushed this enormous remaking of the rules for Wall Street specifically so the Citigroup merger could go through, then he went to work for Citigroup and made $120 million over the next 10 years. He helped push through the Commodity Futures Modernization Act of 2000, which deregulated the derivatives market and created the mortgage bubble. Then Obama brings him back into the government during the transition and surrounds himself with people who are close to Bob Rubin. That’s exactly the wrong message to be sending to ordinary voters: that we’re bringing back this same crew of Wall Street-friendly guys who screwed up and got us in this mess in the first place.
Gergen: That sentiment is exactly what the business community objects to.
Taibbi: Fuck the business community!
Gergen: Fuck the business community? That’s what you said? That’s the very attitude the business community feels is coming from many Democrats in Washington, including some in the White House. There’s a good reason why they feel many Democrats are hostile — because they are.
Taibbi: It’s hard to see how this administration is hostile to business when the guy it turns to for economic advice is the same guy who pushed through a merger and then went right off and made $120 million from a decision that helped wreck the entire economy.
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Gergen is wrong on just about every possible measure. He's saying that lots of big businesses are hoarding their money as revenge: They intentionally want to hamstring our economy because they don't like liberals saying mean things about them. This, despite the fact that Obama has largely gone the Gergen route and done just about everything Wall Street could have wanted - maintaining the Wall Street bailout, nobody goes to jail, increasing federal spending, expanding the bailout to the auto sector, not raising personal taxes, not raising corporate taxes, and stacking his inner circle with people like Volker, Rubin, Summers and Geither.
The "sentiment" Gergen feels is so upsetting to Wall Street that they'd ruin the entire economy out of spite over hearing it uttered by a handful of democrats boils down to pointing out that deregulation was ultimately bad for business and bad for the American people. If he's right our problems are manifestly greater than any economic crisis. If the facts themselves about what happened to our nation and its economy over the past 10 years are so toxic that Wall Street would willfully kill our recovery over their mere utterance, we're totally screwed.
There is no policy on the table to throw CEOs, or lax regulators, or anybody else in prison over the crisis. Aside from the small number of liberal pundits, blogs, and largely powerless liberal congressional minority, there's no real push for any accountability at all - so what's the worry? That their pride would be wounded or something?
Of course there is no need to even do this. We can look back at those past 10 years again and see what happens when you have a pro-business Congress, Presidency and Supreme court. Business - as well as America - had its worst decade since the Great Depression. So all of the hand holding and positive rhetoric didn't inspire Wall Street to fix things. All it did was inspire Wall Street to start its next bubble.
Taibbi was angry because it seems like we've got the worst of both worlds - the "business community" is supposedly upset while liberals feel like their economic ideas are never going to really get tried, even when Democrats control all three branches of government.
When Gergen mentions how the business community is going to punish liberals for daring to even mention what they believe about policy, it reminds me of when Lieberman said he was going to vote against his own idea for health care, the Medicare buy-in, because he found out that liberal Congressman Anthony Weiner made a public speech saying he liked it. Anything liberals liked was obviously something bad to Lieberman, so he punished them and America for daring to praise his own idea.
This type of rhetoric does have a consequence - it trains the President's base to shut up and tune out. If stating their beliefs will just cause the powers that be in the establishment to punish the country, why bother? We can't pretend that we lost in 2010 because we were dispirited - if that was so, passion-inspiring Democrats Alan Greyson and Russ Feingold would have won re-election. But we can say that the Democratic messaging machine can't operate if those that turn the gears - liberal activists, journalists, bloggers, tv hosts, magazine editors, and more - constantly feel like advocating for their views is like bashing their heads against a brick wall.
Unless we can make our party Taibi's instead of Gergen's, voters will increasingly see fewer and fewer differences between us and the Republicans, and the liberal activists that make up the President's base will continue to give up on politics.