By Guest Author John F. Wasik
[Thomas Jefferson’s campaign writers called incumbent President John Adams a “hideous hermaphroditical character.” According to his Democratic opponents, Rutherford B. Hayes, Republican candidate in the 1876 election, shot his mother after getting drunk. As these examples from Harper’s journalist Ken Silverstein show, sometimes outrageous name-calling and accusations are nothing new in US politics. John F. Wasik’s new book, “The Audacity of Help: Obama’s Economic Plan and the Remaking of America” (Bloomberg Press), goes behind sensational labels to understand Obama’s political thinking and policy goals and how they could shape the future of the United States.]
Socialist. Communist. Hitler. Racist. The Joker. Has any president in recent memory been called so many names so quickly in his tenure?
It took a second term for George W. Bush, Bill Clinton and Richard Nixon to achieve pariah status among their detractors. President Obama is getting the primary-schoolyard name-calling treatment in his first eight months.
Yet I predict President Obama will defy all of these malicious and ridiculously undeserved labels to achieve something few maligned chief executives have been able to accomplish: He will establish social capitalism as a new guiding political philosophy for the world’s largest economy.
If Obama succeeds–and I believe he will–he may be able to diffuse the tired old monikers of liberal, socialist and centrist. Put those stickers in a drawer. They don’t precisely describe Barack Obama.
As I discovered in researching my book, President Obama has espoused a hybrid political philosophy. As a student of history, I’d say he’s closer to Teddy Roosevelt than Franklin Delano Roosevelt. Yet he’s got a “Green Deal” working instead of a “Square” or “New” Deal.
Like Teddy and Franklin Roosevelt, President Obama is keenly aware of history and is a man of his times. Unlike his Square and New Deal predecessors, though, Obama has professed no desire to break up corporations or take them to court–even when you can make a strong argument for reducing the size of the largest financial service companies.
Inheriting the worst debacle since the Great Depression, Obama has chosen the path of a social capitalist. He has laid the groundwork for government being a responsible steward. Not interested in nationalizing anything, he wants to bolster banks to make them healthy then move onto other national priorities.
As part of his Green Deal philosophy, clearly economic growth is more important than controlling boardrooms and executive compensation. This is his University of Chicago intellectual background speaking.
President Obama told CNBC that he has a “strong inclination” against a second stimulus package, although he’s hoping that the first stimulus plan can spur private-sector jobs in roadbuilding, green energy, broadband, electrical grid modernization, high-speed rail, medical research and thousands of other projects throughout the country. Some of those promises have come to fruition, but a long-range plan on infrastructure repair and development is necessary if we’re going to compete with China and the rest of the global economy.
If anything, the Obama stimulus and budget plans have provided significant but not overly generous seed money for all of these areas in the hope that private industry will replace the nearly 7 million jobs lost since the recession began in December, 2007. As such, in terms of sheer dollars, the Obama Administration (particularly the Department of Energy) has become the largest venture capital entity in the country.
If Obama were a true socialist, he would have broken up the strangleholds that major insurers have in most state and local markets in health insurance and reduced the size of the largest banks – or taken them over. Even his financial services reform proposal pretty much leaves powerful insurance companies alone, even though their abuses in health-insurance claims, annuity and securities sales have been profligate.
Refocusing on the economy, Obama is hewing close to his blueprint for financial reforms to save capitalism from itself.
Keep in mind that other than the disappearance of Bear Stearns, Lehman Brothers, Merrill Lynch, Countrywide Financial, Washington Mutual, Wachovia Securities and dozens of smaller banks, little has changed on Wall Street.
The biggest banks got bigger (Bank of America, Wells Fargo, et al). The government has veer from the “too big to fail” philosophy, which means we could have another global meltdown again. Nevertheless, Wall Street likes the deregulated status quo and is lobbying intensely to kill financial reform.
“I don’t think they’re going to succeed in killing it,” Obama said bravely of his effort to push through financial reforms. “I’m going to stop them from killing it.”
Yet Obama’s social capitalism will prevail because wiser global financial forces will demand it. We’ve already seen the devastation of unfettered free-market capitalism. Just look at the 1870s, 1890s, 1929–41, 1974, 1999–2002 and the disaster last year. The next global iceberg collision will make 1930 look like a Disney musical.
While I’m not sure booms, busts, and bubbles can be managed, we can certainly devise better warning systems and investor safeguards. No matter what you call Obama, here’s his most boiled-down mantra: Protect the weak from the ravages of greed. In the words of T.R, “bully” to that.
The John Adams and Martin Van Buren examples are from “Useful amateurs:
How the smearing of Barack Obama got crowd-sourced” by Ken Silverstein, Harper’s, November 2008.