Everyone says high unemployment is the defining issue. And everything about this issue is as mainstream as apple pie. Yet, every day America’s political discourse moves further to the extremes.
High unemployment provides fuel for radical politics. But, it will not be solved by radical actions. The challenge is as old as the business cycle: create more jobs—jobs in a capitalist consumer economy, jobs that will emerge as confidence about the future grows. It is not a new-age issue that demands a new consensus. And the means of creating jobs in a financially strained economy are well known and mainstream as well.
Obama’s $447 billion dollar stimulus package can be tweaked, but it can’t be said that it’s off center.
Its payroll tax breaks and capital spending measures avoid further economic contraction and are fully paid for by a one-time income tax increase on the most affluent. They are only singled out because they can best afford to pay a little more.
The new revenues will not be enough to expand big government, ameliorate income disparities, or avoid entitlement reforms. They are intended to recruit, not soak the rich. Indeed, if they are introduced in combination with bipartisan proposals for tax reform, the temporary surtax on the highest incomes could, in fact, further encourage the most affluent to invest even more heavily in the growth of the American private sector.
Nevertheless, the buzz around Obama’s latest stimulus package and his speeches out of Washington is that he’s trying to be a polarizer too. After sitting in the stands for twenty years of escalating partisan acrimony, Obama’s is finally coming onto the field to fight—to join the class war.
Even the conscience-struck conscience of conservatism, David Brooks echoes the theme:
“If Obama were a Republican, he could win with this sort of strategy: Repeat your party’s most orthodox positions and then rip your opponent to shreds. Republicans can win a contest between an orthodox Republican and an orthodox Democrat because they have the trust in government issue on their side.
“Democrats do not have that luxury. The party of government cannot win an orthodox vs. orthodox campaign when 15 percent of Americans trust government.
“Yet this is the course the Obama campaign has chosen. He’s campaigning these days as the populist fighter, the scourge of the privileged class.”
It’s just too handy to put Obama off to the side as the Republican base drives Republican presidential aspirants further and further to the far right.
Despite the Birthers and hard feels on Wall Street, the fact remains that the Obama administration has spent almost all its political capital restoring the private sector, when it was down. While the US government operates without a triple-A credit rating, the S & P 500 corporations clocks up their 9th quarter of double-digit profits.
Obama, however, needn’t submit to the idea that only 15% of Americans trust their government. The public isn’t so distrustful that it’s ready to walk away from public health, social security, market regulation, and a strong defense. It remains to be seen whether they’ll agree that it safe to pocket another round of across-the-board tax cuts and buy gold—just in case the federal government goes broke.