neoliberalism – The Progressive Democrat

The Democrats’ Davos ideology won’t win back the midwest

The party has harmed millions of their own former constituents. If they change course, they can reverse their losses

‘The wreckage that you see every day as you tour this part of the country is the utterly predictable fruit of the Democratic party’s neoliberal turn.’ Photograph: Barry Lewis/Corbis via Getty Images

By Thomas Frank

The tragedy of the 2016 election is connected closely, at least for me, to the larger tragedy of the industrial midwest. It was in the ruined industrial city of Cleveland that the Republican Party came together in convention last July, and it was the deindustrialized, addiction-harrowed precincts of Ohio, Pennsylvania, Michigan, and Wisconsin that switched sides in November and delivered Donald Trump to the Oval Office.

I am a midwesterner too, and I like to think I share the values and outlook of that part of the country. I have spent many of the last 15 years trying to understand my region’s gradual drift to the political right. And I have spent the last three weeks driving around the deindustrialized midwest, visiting 13 different cities to talk about the appeal of Donald Trump and what ails the Democratic Party. I met labor leaders and progressive politicians; average people and rank-and-file union members; senior citizens and Millennials; sages and cranks.

And what I am here to say is that the midwest is not an exotic place. It isn’t a benighted region of unknowable people and mysterious urges. It isn’t backward or hopelessly superstitious or hostile to learning. It is solid, familiar, ordinary America, and Democrats can have no excuse for not seeing the wave of heartland rage that swamped them last November.

The wreckage that you see every day as you tour this part of the country is the utterly predictable fruit of the Democratic party’s neoliberal turn. Every time our liberal leaders signed off on some lousy trade deal, figuring that working-class people had “nowhere else to go,” they were making what happened last November a little more likely.

What we need is for the Democratic party and its media enablers to alter course. It’s not enough to hear people’s voices and feel their pain; the party actually needs to change. They need to understand that the enlightened Davos ideology they have embraced over the years has done material harm to millions of their own former constituents. The Democrats need to offer something different next time. And then they need to deliver.

The Guardian

The interesting thing that happened when Kansas cut taxes and California hiked them

imrs.php — Presidential candidate Bernie Sanders poses for a photograph with workers… (Photo by Matt McClain/The Washington Post)

In 2012, voters in California approved a measure to raise taxes on millionaires, bringing their top state income tax rate to 13.3 percent, the highest in the nation. Conservative economists predicted calamity, or at least a big slowdown in growth. Also that year, the governor of Kansas signed a series of changes to the state’s tax code, including reducing income and sales tax rates. Conservative economists predicted a boom.

Neither of those predictions came true. Not right away — California grew just fine in the year the tax hikes took effect — and especially not in the medium term, as new economic data showed this week.

Now, correlation does not, as they say, equal causation, and two examples are but a small sample. But the divergent experiences of California and Kansas run counter to a popular view, particularly among conservative economists, that tax cuts tend to supercharge growth and tax increases chill it.

California’s economy grew by 4.1 percent in 2015, according to new numbers from the Bureau of Economic Analysis, tying it with Oregon for the fastest state growth of the year. That was up from 3.1 percent growth for the Golden State in 2014, which was near the top of the national pack.

The Kansas economy, on the other hand, grew 0.2 percent in 2015. That’s down from 1.2 percent in 2014, and below neighboring states such as Nebraska (2.1 percent) and Missouri (1.2 percent). Kansas ended the year with two consecutive quarters of negative growth — a shrinking economy. By a common definition of the term, the state entered 2016 in recession.

The Washington Post

Bernie Sanders Will Make the Economy Great Again

Liberal critics like Paul Krugman argue that Sanders’s economic platform is unrealistic. They are dead wrong.

Bernie Sanders attends a rally in Upper Senate Park with striking workers to call for a minimum wage of $15 per hour, November 10, 2015. (Tom Williams / CQ Roll Call via AP Images)

By Robert Pollin

Does Bernie Sanders’s economic program amount to pie-in-the-sky nonsense? The short answer is no. All of his major proposals are grounded in solid economic reasoning and evidence.

But that hasn’t stopped a major swath of leading liberal economists and commentators to insist otherwise. Paul Krugman has led these attacks from his New York Times perch, charging repeatedly that Sanders makes “outlandish economic claims,” embraces “deep voodoo” economics, is “not ready for prime time,” and so forth. A recent Washington Post article by columnist Steven Pearlstein cites several other liberal economists criticizing Sanders’s support for Scandinavian-style social democratic policies, concluding that his program “promises all the good parts of the Scandinavian model without any of the bad parts.”

Sanders’s economic agenda certainly represents a dramatic departure from what has come out of mainstream Democratic Party circles for a generation, to say nothing, of course, of the Republicans. The key elements of Sanders’s program include a “Medicare-for-all” single-payer healthcare system; an increase in the federal minimum wage from $7.25 to $15 an hour; free tuition at public colleges and universities, to be financed by taxing Wall Street transactions; opposition to trade agreements like the North American Free Trade Agreement (NAFTA) that have weakened the wage-bargaining power of US workers; large-scale public investments to build a clean-energy economy and rebuild the crumbling US infrastructure; and strong Wall Street regulations to promote productive investments and job creation over casino capitalism.

By contrast, the Democratic Party under Bill Clinton embraced an only moderately less aggressive pro-business agenda than the Republicans. Clintonomics featured Wall Street deregulation, NAFTA, and only tepid support for policies benefitting working people and the poor. This is how, over the full eight years of the Clinton presidency, average wages ended up being 2 percent lower than the average under Ronald Reagan and George H.W. Bush and nearly 10 percent less than under Jimmy Carter’s “years of malaise.”

The Nation