"We have systematically diminished the role and the responsibility of our government, land we have watched our market become imbalanced," said either Senator Hillary Clinton or Senator Barack Obama. I just believe strongly that we are in great need of a total overhaul."
"It's been government research and investment that made the railways possible and the Internet possible," said the other. "It's been the creation of a massive middle class, through decent wages and benefits and public schools that allowed us all to prosper."
The first statement is Hillary Clinton's. The second came from Barack Obama. But either could be tucked away in the other's speech without anyone raising an eyebrow.
Step back, just for an instant, and appreciate the moment. The two candidates left vying for the Democratic Party's nomination are not running from government or quietly weaving a pale thread of populism around rhetoric meant to reassure whinnying bond markets. They are saying, forthrightly, that government is not the problem, unchecked corporate capitalism is.
Not since 1992, when James Carville took his magic marker to the war room's whiteboard to immortalize, "It's the economy, stupid," have we seen an election conducted amid an economy in such screaming distress. Unemployment is rising, and the stock market is, well, falling is too kind a word; it's more drilling a hole to the center of the earth. New data out of the National Association of Realtors suggests that, over the course of 2007, a full $4 trillion in housing wealth was wiped out.
This is particularly grim news, as housing wealth has been the engine of our economy over the past couple of years. Americans have patriotically sustained our growth by overspending on houses, then riskily refinancing those houses in order to overspend on everything else. But with banks acting as their eager enablers, Americans took out too much credit, and many found themselves unable to pay it back. They lost their homes, and with them, their main source of wealth, and with that, their ability to consume, and thus their ability to pay back the banks that loaned to them in the first place. And so down go the banks, and with the banks, the credit market, and with the credit market, the stock market, and on and on, rippling--or, more accurately, ripping--straight through the vast and complicated market atop which American power rests. This is why the Federal Reserve has tossed aside its normal, deliberative processes and is cutting rates like some frenzied horror-film slasher.
The situation is dire enough that the Bush administration, apparently fearing a Marie Antoinette moment, has actually gotten behind a stimulus package, albeit one that shortchanges food stamps and unemployment benefits. But beyond the substantive shortcomings of the stimulus, the very fact of its existence unsettles. The sight of George W. Bush embracing John Maynard Keynes is enough to suggest that the economic end times may be at hand.
THIS IS THE CONTEXT in which the campaign for the presidency is taking place. In South Carolina, a full 52 percent of Democratic primary voters said the economy was their most important issue. Health care, an intertwined concern, clicked in with 25 percent. Iraq commanded a mere 19 percent.
If the campaign is largely about the economy, it has not, however, featured much of an argument over the economy. Rather, we've seen a dramatic convergence in the domestic policies of the Democrats running for president.
It wasn't ever thus. In 1992, Bob Kerrey was touting aversion of single-payer health care, Bill Clinton a hybrid of single-payer and managed care, and Paul Tsongas a type of managed care. The distance between the various candidates was immense. In 2004, none of the major campaigns had universal healthcare plans, and except for Gephardt's, none even came close. This year, Clinton and Obama have released functionally similar proposals. …