Obama: Mr 99%?

The US president needs to recognise the resentments that have sparked the 99% movement.

Just a bunch of "kids and kooks" or the early and messy stirrings of a deeper shift in US politics? That's the question pre-occupying US politicians and assorted commentators from left to right as the one month old occupation of Wall Street spreads to a growing number of cities.

They call themselves the "99 per cent" -- representing, they say, everyone apart from the super-rich and powerful. On the left the nacsent movement has been lionised by Naomi Klein as "the most important thing in the world" with self-conscious comparisons made to the recent uprisings in Tunisa and Egypt, as well as the "indignados" in Madrid and those on the streets in Athens. In contrast, high-brow centre-right commentators view it as inchoate, unimaginative, and amateurish: all slogan, no proposal. Grow up, put on a suit and do some hard policy work is their message.

Meanwhile the Tea Party, scornful though they are of the notion that government should do more to tackle the problems of the 99 per cent, take the protestors a bit more seriously even if they they don't like to say so. Until now Tea Party activists have enjoyed a near monopoloy on grass-roots energy and righteous anger, so they are eyeballing the new competition carefully. They've been prompted to spawn their own counter-movement "the 53 per cent", representing the interests as they see it of the half of the population who are federal tax payers. (Memo to Liberal Democrats seeking to remove ever more low-earners from the UK tax-system: working people who've been taken out of the tax-system are viewed as non-contributors by the populist right). Other voices lament the fact that the cultural chasm between the 99 per cent-ers and the Tea Party is so large that it will not permit common cause to be made on one or two specific issues where there is some populist shared ground.

But perhaps most interesting is that some important establishement and centrist voices are choosing not to dimiss the protestors, which they surely would have done only a few years ago. Hence the likes of the New York Times and the Financial Times have adopted sympathetic, if questioning, stances (indeed the FT even felt moved to invoke the spirit of The Diggers -- which surely must be a first -- in a recent op-ed).

This measured response is prompted in part by the increasingly widespread reconigtion of the scale of mainstream resentment at the explosive growth in rewards going to the richest 1per cent -- and this at a time of continued public outrage about the cost of the last bank bailout (as the next one moves into view). But it's also rooted in a new appreciation of what has been happening to the living standards of most of the other 99 per cent, and a deepening sense of anxiety about what could happen if these trends persist.

There is now indisputable evidence that the US economy isn't working for what are termed middle-class families. The income of the typical American family has seen only aneamic growth for a generation. But from 2000 - 2010 these these trends worsen: the median income of families with children in the US has fallen by more than 11per cent, with a fair chunk of that fall happening before the onset of the recession, though it has deepened since (indeed 11per cent will be an understatement as incomes fell again sharply in 2011). As the chart below shows, this has cut across all racial groups -- always an important factor in US politics -- though some far more than others, with African-American families seeing a staggering 18 per cent drop in their incomes.

 

[Source: US Census Bureau]

Until recently one of the main virtues of the US economy -- often held up in mitigation against these long-term wage trends -- has been its powerful record jobs. Yet employment levels have been crashing over recent years, which will act as a further drag on future wage growth. The "American jobs machine" hasn't just run out of steam; it has broken down.

These challenges leave the Obama administration with little choice but to run against the economic system that it oversees. The President now regularly opines about the bad deal that the middle-class are getting: "a lot of folks who are doing the right thing aren't rewarded and a lot of folks who aren't doing the right thing are rewarded". In another echo of our own politics, Vice President Joe Biden proclaims that "the bargain has been breached."

Yet for all this rhetorical effort the Democratic leadership is nonetheless torn between different strategies for responding to this new vibrancy on the left. On the one hand, the case against embracing the new currents animating US politics is deeply institutionalised: it's been a long time since the Democratic Party successfully mobilised populist political sentiment -- and there are strong grounds for questioning its willingness to do so now, a point Robert Reich has recently made. Moreover, Obama will clearly want to fight from the centre in 2012, doing everything he can to push the Republicans to the right. He is very unlikely to think that standing shoulder to shoulder with unruly street protestors will help this cause. And for all his tough talk about Wall Street, he will also be looking for his own big money donations.

Against this is the obvious appeal of finding a way of tapping into some raw political energy, rekindling idealism and identifying some plausible enemies -- all of which Obama needs -- and which together add up to some of the key driving forces in politics. Clearly this doesn't mean signing up to all the myriad ideas emerging from the 99 per cent movement, but it does mean recognising more directly the resentments and insecurities that have sparked this new force. If handled deftly this approach could also strike a chord with the anxious American middle-classes.

As all sides look to 2012 it is clear that the anger that has surged across US society, well beyond those occupying Wall Street or attending Tea Party meetings, is a highly unpredictable and potent force, especially for an incumbent President. If Obama fails to find a way of riding and successfully steering it, then it is set to turn against him.

Gavin Kelly is a former adviser to Downing Street and the Treasury. He tweets @GavinJKelly1.

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What's happened to the German left?

For a fourth successive election, the left seems to be failing to challenge the status quo.

When Germany goes to the polls this weekend, Angela Merkel is expected to win a fourth term in office. Merkel has maintained her commanding lead in the polls on 37 per cent, while her closest competitor, the Social Democratic Party (SPD) has been relegated to, at best, a possible coalition partner. 

The expectation that the status quo will continue has left commentators and politicians of all stripes asking: what has happened to the German left?

Lagging behind in the polls, with just 20 per cent of the country's voting intention, Martin Schulz’s SPD has slumped to its lowest level this year only days before the vote, according to the latest poll by Infratest dimap for ARD television.  

Even the prospect of a left-wing alternative to a Merkel-led coalition appears to have become unpalatable to the electorate. An alliance between the SPD, die Grünen (the Greens) and the socialist party die Linke (the Left) would not reach the threshold needed to form a government.

One explanation for the German left's lack of impact is the success Merkel has had in stifling her opposition by moving closer to the centre ground. Over the last four years, she has ruled a grand coalition known as GroKo (Große Koalition) with the centre-left SPD, leaving many of its voters believing their party was no longer any different to the chancellor's conservative Christian Democratic Union (CDU).

Rolf Henning, 34, has been a member of the SPD since 2004. Campaigning in Pankow, a diverse area of eastern Berlin which has traditionally voted on the left, he told the New Statesman that although the coalition had enabled the SPD to push its social agenda, the party did not receive any credit for it.  

“It is now hard to motivate people to vote for the SPD because people think it will not make any difference. If we were to enter a coalition again with Merkel and the CDU then our support base will drain even further,” he said.  

Another grand coalition between the CDU and the SPD is very much on the cards, as Merkel is unlikely to win an outright majority. But while the arrangement has seemingly worked out well for the chancellor, its benefits for the SPD seem rather less certain.

“The political strength of the left is an illusion," says Gero Neugebauer, a political analyst and a former senior researcher at the Freie Universität Berlin, "The SPD did a good job in the coalition to push issues of social policy and family policies, but Ms Merkel took the credit for a lot of it. People saw the car and the chauffer rather than paying attention to the engine."

In 2015, under pressure from the SPD, the Merkel administration introduced a minimum wage in Germany, a benchmark for many in the party which yet did little to gloss over the SPD’s image. On the contrary, Merkel’s election campaign sought to win over disillusioned SPD voters.

According to Neugebauer, the left-wing parties have failed to work together to form a real alternative coalition to the Merkel administration. He warns that Germany’s left-wing camp has become “an illusion” with “virtual power”.

For a short-lived moment the election of Martin Schulz, the former president of the EU Parliament, to head the SPD, brought hope to the idea of a left-wing coalition. 

Stefan Liebich, a member of parliament for die Linke representing the Pankow district, says the SPD initially rose in the polls because people thought there could be an alternative coalition to Merkel. "But then the SPD made a lot of mistakes and they were wrongly told they would lose support if they worked with us," he adds.

"Now nobody believes a left-wing coalition could ever happen because the SPD is so low in the polls.” 

Before Schulz took over the SPD, few believed that after four years in the coalition government the party had a good chance in the upcoming election. “But Schulz arrived and said ‘I will be chancellor’ and it was like a phoenix rising from the ashes,” says Neugebauer.

Schulz revived the social-democratic tradition and spoke about social justice, but the delay of his election programme left many wondering whether he would be able to walk the walk – and his popularity started to fall.

“Compared to Merkel, he became less credible and less trustworthy,” says Neugebauer.  

The SPD are, of course, not the only left-wing party running. Back in Pankow, Caroline, a lawyer and a long-time SPD voter said she was considering voting for the more left-wing die Linke because she did not want to give her ballot to Schulz.

“There is something about him, he is not straightforward and he is too much like the CDU," she continues. "As the head of the EU Parliament, Schulz was good but I don’t think he has what it takes to tackle issues in Germany."

For Ulrike Queissner, also a Pankow resident, the SPD’s lurch to the centre convinced her to vote for die Linke: “The SPD has become mainstream and part of the establishment. It has become too close to the CDU and has no strong position anymore.”

Stable at about 8 per cent in the polls, die Linke is still trailing the extreme-right Alternative fur Deutschland (AfD), which is anticipated to win between 8 and 11 per cent of votes. This means it would enter the German parliament, the Bundestag, for the first time, becoming its third biggest party.

At the core of die Linke’s manifesto is the redistribution of wealth, a peaceful foreign policy and measures to stamp out the remaining social rift between east and west Germany.  

The party strives to challenge Merkel’s feel-good slogans by putting the spotlight on the discrepancies between rich and poor, and east and west.

 “When we look around to Portugal, Spain, Italy, and maybe even to the UK, we seem happy," says Liebich. "We don’t have an exit [from the EU] debate or a high unemployment rate. And yet, there is a part of Germany that sees that things are not going so well."

And for some of die Linke’s eastern electorate, immigration is at the top of the list of grievances, putting pressure on a party which has always defended an open door-policy – something Liebich acknowledges.

“In Berlin a majority of voters say they are open to people who need help, but in the eastern states, where we have a high unemployment rate and a lot of people who are not used to living with people of other cultures, there is a lot of anger."

That will add to concerns that large numbers of silent AfD supporters could create a surprise in the traditionally left-wing area of east Germany, where the far-right party is capitalising on the anti-immigration sentiment. The left seems to be squeezed between Merkel’s move to the centre ground and the AfD’s growing populist threat.

For Neugebauer the prospect of AfD members in parliament should force left-wing parties to sharpen their political lines, and form a consensus bloc against the rising extreme-right. The silver lining lies in the hope that all three left-wing parties – die Linke, die Grünen and die SPD – find themselves together in the opposition.

“Then, there would be an opportunity to start a conversation about what the parties have in common and start working together," he says. "It would be a chance for the German left to find itself again and create a vision for co-operation.” 

And yet, commentators still anticipate that at least some part of the left will end up working with Merkel, either through a grand coalition with the SPD or a three-way “Jamaica coalition”, with the pro-business FDP and the Greens. For the German left the time for cooperation, and a shot at taking charge of Germany's future, may still be some years away.