“This election is activating large parts of the American psyche,” observes Nicholas Lemann in a seminal portrait of Mitt Romney in a recent New Yorker. He notes that the voters, after the financial crisis and other disillusionments, are longing for “a big fix, a new social compact.”
These hard-to-articulate, unconscious yearnings are making this a fascinating election, in large part for its openness to extremism on the GOP side, its mood swings, and its highly changeable candidates like Romney. (Who knew he was that other Mormon, Jon Huntsman, all along?) There are big elephants in the room, rarely named but deeply felt. Some of them even roam in our state politics.
Let me introduce two of these elephants.
The first is a sense that we are moving from the long postwar boom to a difficult new order. Robert Samuelson captures this well in his description of a “giveaway politics” that is now shifting to “takeaway politics.” This is the American version of the European collapse of the welfare state.
In the era of giveaway politics, Samuelson writes, speaking of 1960-2010, federal spending on “payments to individuals” (entitlements, food stamps, medical care) rose from 26 percent to 66 percent, of the budget and yet the tax burden, as a percent of GDP, only rose from 17.8 percent to 18.5 percent. This free lunch was made possible by factors that no longer apply: strong economic growth, plenty of young people paying taxes to support old folks, and a drop of military spending from 52 percent to today’s 20 percent of federal outlays.
That produced a spoiled electorate, as well as carefree politicians who loved doling out the goodies. Those habits will be hard to break.
And today? A stalled business sector. Extremely high public debt (now 70 percent of the economy, up from 40 percent four years ago), baby boomers retiring and shifting the income demographics, and little remaining opportunity to shift more dollars from defense spending. Politicians now must take away benefits.
This has produced, writes Robert Merry in The National Interest ($), an era of transformational politics, replacing a crumbling Old Order. Its elements: a reversion to an earlier, Jeffersonian/Jacksonian tradition of distrusting large federal government and its cronyism; disillusionment with FDR-style constituency groups that have a permanent stake in government programs; and a sense of paralysis in a government that “can’t seem to get at the problems of our time because too many entrenched interests possess the power to prevent it.”
Understandably, politicians don’t want to run on a candid platform of austerity and castor oil. Romney shifts attention away from painful “takeaways” to the libertarian joys of an untrammeled economy. Obama dwells on the moral satisfactions of a communal vision, in which “citizenship” sustains for a few more years the old vision of enlarged government, and taxing the wealthy keeps giveaway politics rolling along. (At the state level, it is the rainbow of revived economic growth that recharges the treasury in Olympia, with only a few painful cuts needed.)
The second elephant in today’s politics is the emergence of the new American economy, one based not on large manufacturing organizations like George Romney’s American Motors, but on the financialized economy where Mitt Romney’s Bain Capital flourishes. One could sense this “new man” stepping forward with a scary confidence in the first presidential debate. The boardroom bully of “creative destruction” rudely waved aside the crumbling old order personified by the baffled Jim Lehrer.
Lemann’s account of Romney's rise traces this transformation to a 1970s version of the seismic shift in American culture in the 1960s. In both cases, a younger, impatient group of people transformed the older more traditional group. In the 1960s, the revolt was about politics, culture, dress, identity politics and music. In the 1970s, the insurrection was about ways of doing business. Instead of the traditions of prudence, stability and duty to employees and community, we developed a sector that moved vast assets around at great speed and risk, on a global stage. Seattle’s Boeing and defense economy buffered us from such stark change.
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