The year of living dangerously

Barack Obama called for a new politics, but during his first year in office his reforming agenda has

"On this day, we come to proclaim an end to the petty grievances and false promises, the recriminations and worn-out dogmas that for far too long have strangled our politics," the new president said on a cold January 2009 day on the National Mall. "We remain a young nation, but in the words of Scripture, the time has come to set aside childish things."

A few weeks later, congressional Republicans seized on a sliver of the Democrats' economic stimulus package, money to re-sod that same Mall, and, declaring it wasteful, cited it as a reason for unanimously opposing the bill in the House of Representatives. Six months after that, in August, a Republican senator told voters they "had every right to fear" that Democratic health-care legislation would "pull the plug on Grandma". Last month, Senate Republicans demanded that clerks read aloud a 383-page amendment so as to slow the already glacial progress of the health-care bill. Then Dick Cheney and other Republicans seized on the failed attack on a Detroit-bound jet as proof that the president was soft on terrorism.

Such is the resistance that Barack Obama has met with as he has set out to transform Washington and the country along with it. It is not unusual these days for the keepers of the conventional wisdom to survey the fraught political landscape and ask, "What happened to the hope?" But this is a misdiagnosis of the young administration's tribulations. For one thing, there is a risk of reading too much into the national gloom: people would be a lot more hopeful if unemployment were not at 10 per cent. Such talk also misremembers the Obama campaign as a revival tour full of airy exhortations. But "hope" and "change" had been the T-shirt slogans, the marketing tags. The stump speeches that set the trail on fire were in fact remarkably even-keeled affairs.

That was what made them so unusual - thousands would sit transfixed as the tall, skinny man on stage held forth in discursive tones, giving way to the stirring peroration only in the final moments. And the prevailing message was hardly blithe optimism, but a call for the country to get serious again, to be thoughtful and grown-up enough to accomplish the big things that had been left undone for too long.

That is the goal which has proved so damned elusive. Nearing his first anniversary, Obama can point to the rescue of the economy; reconciliation with the world, with important decisions on Guantanamo, Afghanistan and climate change that, despite concessions to grim realities, signal a new approach; and, as appears likely, the passage of comprehensive health-care reform, the great white whale that American liberals have spent decades pursuing. But with his more abstract goal of transforming the nation's political culture still so distant, the achievements have not fused into the reformist rejuvenation and common purpose that he conjured on the campaign trail.

Health care is the prime example. Obama decided to take on that brutally daunting issue right out of the gate partly for its own sake - there are 45 million Americans without health insurance and costs are soaring to where health care consumes 17 per cent of the economy. But he also undertook it to show that it could be done, as the first big step in realising his vision of a more capable form of politics.

What a rebuff, then, to have the endeavour plunge into a swamp of intemperance and cynical misinformation. The Democratic proposals were deliberately incremental - instead of replacing the private insurance industry with a government-run insurance system, as many liberals have sought for years, they sought primarily to make it more affordable for people to buy private insurance.

Yet they might as well have called for full nationalisation. Republican congressmen, after years of arguing for reductions in Medicare, the programme for the retired, started warning seniors already ill-disposed to Obama about his proposed trims to the programme to help pay for health coverage expansion - even as the GOP also railed against the threat of "government-run health care" for the rest of the population. Sarah Palin declared that "Obama's death panels" would ration care. Taking these cues, voters turned out en masse for congressmen's meetings during the summer break, with TV cameras in pursuit. "Keep your government hands off my Medicare!" shouted one man in South Carolina, with keen irony.

The outburst was going against everything Obama had believed to be possible in the country he'd been elected to lead. He tried to restore order in a speech to Congress in September: "When any government measure, no matter how carefully crafted or beneficial, is subject to scorn; when any efforts to help people in need are attacked as un-American; when facts and reason are thrown overboard and only timidity passes for wisdom, and we can no longer even engage in a civil conversation with each other over the things that truly matter . . . at that point we don't merely lose our capacity to solve big challenges. We lose something essential about ourselves." Hadn't the campaign shown it could be done, that people could . . . elevate? Yes, but that was the campaign, when he thrived by ignoring the daily bushfires and focusing on what lay ahead, and when his equanimity served as a contrast with his opponents. Now there was no clear goal or foil.

But the rough going was about more than the hard transition from the trail to the office. It has been Obama's bad luck that, as much as his temperament seemed suited for the campaign of 2008, it was uniquely tested by the America of 2009. The candidate who had promised a new era of civility and unity arrived in the White House just when the opposition party was in the middle of a profound identity crisis that was allowing the least accommodation-minded to take the lead.

Though diminished, the Republican cohort in Congress is more truculent and ideologically pure than ever. In the House, there are zero
Republicans among the 21 members from New England, the erstwhile bastion of moderate Republicanism, and only one out of 177 Republicans voted for the health-care bill in November. In the Senate, the only Republican showing any sign of supporting it was Maine's Olympia Snowe, but by December even she was backing away. And the problem went beyond winning GOP votes. Obama's conciliatory approach was not centrism - while he would love big bipartisan deals, what he was really after was a new collegial era of mutual respect and intellectually honest debate. And it was in the matter of tone and comity that the failure was most evident, never more so than when he reached the part of his health-care speech to Congress where he pledged that subsidies would not cover illegal immigrants and a House Republican shouted out: "You lie!"

Worsening the polarisation was the economic crisis. The financial collapse required Obama to take action in areas that were not part of his agenda, but which provided more than enough evidence to many that social democracy (if not something worse) was breaching the gates. He completed the bank bailouts, rescued the auto companies, and signed the $787bn stimulus package. No matter that the first two had been set in motion by George W Bush. When the White House then moved on to what it really wanted to do - set up market-based systems to limit carbon emissions and expand health insurance - the other side (and some in the nervous middle) declared that it had already done enough governing for the year, thank you. I spoke with one senior White House official who was untroubled, saying it meant only that Obama would have to make health-care reform deficit-neutral. This seemed rather Panglossian. More credible was another adviser who told one of my colleagues that it was the actions the White House was forced to take that fed the belief that government is taking over everything. "These were things we had no interest in doing," the adviser said. "That's the irony."

By autumn, some hazarded another explanation for the vituperative resistance. Noting that the shouting congressman was from South Carolina, birthplace of the Confederacy, the New York Times's Maureen Dowd wrote that, "fair or not", she heard "an unspoken word in the air: You lie, boy!" and concluded: "Some people just can't believe a black man is president and will never accept it." Jimmy Carter declared that an "overwhelming portion of the intensely demonstrated animosity . . . is based on the fact that he is a black man".

Carter was roundly scolded, but there had been signs of recalcitrance in the land - election-day results showing a long band of territory running through Appalachia and the Upper South and into east Texas where John McCain outperformed George W Bush's 2004 numbers, despite McCain's poor overall showing; the July poll showing that a majority in the Southern states, a far greater share than in other regions, was not convinced that the president was a citizen of the United States.

By the end of 2009, the most overheated opposition had expended itself. But as Obama's job approval ratings dropped to below 50 per cent, it was plain that he was facing a bigger problem with the broad middle. Also worrisome were softening numbers within Obama's base, demoralised as it was by compromises on health care and the decision to send an additional 30,000 troops to Afghanistan. Obama had made it clear when on the campaign trail that he would refocus the nation's efforts in Afghanistan, but many had taken this plank merely as a rhetorical feint to make more politically palatable his vow to end the Iraq war, to show he was only opposed to the "dumb" war. Once in office, and confronted with the miserable menu of options, he decided, with evident misgivings, that this campaign pledge would be upheld. This was the Obama approach in its purest form - he spent weeks deliberating, putting sober rationalism fully to the test - yet it was deployed on an issue that was going to win him little favour with his supporters and at most grudging approval from the other side. The final decision was all Obama-style nuance - he would send the troops, but start to bring them home in 2011; he would escalate to end the war. The critics called this muddled incoherence. Yet he offered more duality in his Niebuhrian Nobel speech a few weeks later in Oslo, where he told those who had selected him for a peace prize that "evil does exist in the world" and spoke of the "two seemingly irreconcilable truths - that war is sometimes necessary, and war is at some level an expression of human folly".

In this moment of political anxiety, many of the "Obama should" prescriptions pouring in carry a whiff of panic that the president with the long view surely scoffs at. It is possible that the passage of health-care reform will provide a boost, if only out of the public's relief that the issue, with its endless gridlock, will be off the airwaves as the focus turns to a new jobs bill, financial reform, deficit control, climate change and schools. An uptick in employment could change the mood. And the obsession with Obama's performance overlooks the difficulties that structural realities arrayed against him. It is hard to overstate the impact of the Senate's expansion of its extra-constitutional custom of filibusters, to the point where 60 votes are now required for even routine votes - ten more votes than a majority, and a number that requires the Democrats to corral everyone in their camp, including the vice-presidential nominee-turned-mercurial "independent", Joe Lieberman.

That said, the White House could improve on its handling of the legislature. Obama may be hampered by his Burkean respect for institutions. A little less deference for Congress would have allowed him to take a stronger hand in crafting the stimulus bill: helpful as economists say it has been, it has been tarred a political loser because it was seen as a product of the unpopular Congress. It would also have made him more willing to challenge the Senate's dysfunction by, for instance, threatening to force through the health-care bill with a procedural tactic that would require only a simple majority. Washington mandarins might have fainted at such a move, but it would have given Rahm Emanuel, Obama's pugilistic chief of staff, more leverage over conservative Democrats who have given the White House such fits.

Above all, the message needs some work. It is apparent now that there was a link missing from the campaign rhetoric - there was Obama's call for a "new politics" and then there was the list of policy goals. And the latter were presented as mere common sense, unfettered to any political argument beyond the proposition that balance needed to be restored to an off-kilter economy. This was highly effective on the trail - rarely had a Democrat made a liberal agenda sound so mainstream, much as Ronald Reagan had with conservatism. And it was not necessarily sneaky - liberals would argue that a call for thoughtful and decent politics equates with progressive policies. But the absence of a more explicit political case for his agenda helps explain why so many voters profess themselves surprised by the steps Obama has taken.

What makes it all hang together - the need for broader health coverage, for action on climate change, for tighter financial regulations? Obama ventured a unifying theme in April with a big speech about building a "new foundation" for lasting growth, and in the health-care speech to Congress in early September, he strongly articulated government's role - the "belief that in this country, hard work and responsibility should be rewarded by some measure of security and fair play . . . an acknowledgement that sometimes government has to step in to help deliver on that promise".

But that case has not been as sustained or forceful as it could be. Some Democrats argue for a more forthright populist narrative - a persuasive explanation of how much power the moneyed interests have acquired and of the societal ill this has wrought, and of how the Obama agenda is rectifying that. This could have built momentum for more aggressive measures - tougher regulation of Wall Street, better provisions for affordable coverage in the health-care bill, a bigger stimulus package, which the White House has since conceded its economists believed necessary. But these Democrats worry Obama is being held back by advisers who come with strong Wall Street ties and who fear populism would sell poorly both in the markets and to some moderates. Perhaps, but it could also co-opt some of the ire that is instead fuelling the opposition - voters might be less upset about "big government" if they saw the unemployment rate dropping because of a bigger stimulus, and bankers being held more to account, and health care becoming more affordable. Effective policies make for good politics, no matter the ideological origins.

There are variations on these suggestions. What they share is a recognition that something ineffable from the campaign is missing. In 2008, Obama called on the country to do the big thing but never had to articulate fully what that was, because the call had an implicit short-term goal: his improbable election. One year in, a country that was swept up by that project, with all its insurgent fervour and unquestionable grandeur, needs a new mission. For all the difficulties of 2009, the president knows how to make such a case - by being serious, grounded and unchildish, and appealing to the same native intelligence that responded so well to his overtures not so long ago at all.

Alec MacGillis is a correspondent for the Washington Post

This article first appeared in the 11 January 2010 issue of the New Statesman, Obama: the year of living dangerously

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How can Britain become a nation of homeowners?

David Cameron must unlock the spirit of his postwar predecessors to get the housing market back on track. 

In the 1955 election, Anthony Eden described turning Britain into a “property-owning democracy” as his – and by extension, the Conservative Party’s – overarching mission.

60 years later, what’s changed? Then, as now, an Old Etonian sits in Downing Street. Then, as now, Labour are badly riven between left and right, with their last stay in government widely believed – by their activists at least – to have been a disappointment. Then as now, few commentators seriously believe the Tories will be out of power any time soon.

But as for a property-owning democracy? That’s going less well.

When Eden won in 1955, around a third of people owned their own homes. By the time the Conservative government gave way to Harold Wilson in 1964, 42 per cent of households were owner-occupiers.

That kicked off a long period – from the mid-50s right until the fall of the Berlin Wall – in which home ownership increased, before staying roughly flat at 70 per cent of the population from 1991 to 2001.

But over the course of the next decade, for the first time in over a hundred years, the proportion of owner-occupiers went to into reverse. Just 64 percent of households were owner-occupier in 2011. No-one seriously believes that number will have gone anywhere other than down by the time of the next census in 2021. Most troublingly, in London – which, for the most part, gives us a fairly accurate idea of what the demographics of Britain as a whole will be in 30 years’ time – more than half of households are now renters.

What’s gone wrong?

In short, property prices have shot out of reach of increasing numbers of people. The British housing market increasingly gets a failing grade at “Social Contract 101”: could someone, without a backstop of parental or family capital, entering the workforce today, working full-time, seriously hope to retire in 50 years in their own home with their mortgage paid off?

It’s useful to compare and contrast the policy levers of those two Old Etonians, Eden and Cameron. Cameron, so far, has favoured demand-side solutions: Help to Buy and the new Help to Buy ISA.

To take the second, newer of those two policy innovations first: the Help to Buy ISA. Does it work?

Well, if you are a pre-existing saver – you can’t use the Help to Buy ISA for another tax year. And you have to stop putting money into any existing ISAs. So anyone putting a little aside at the moment – not going to feel the benefit of a Help to Buy ISA.

And anyone solely reliant on a Help to Buy ISA – the most you can benefit from, if you are single, it is an extra three grand from the government. This is not going to shift any houses any time soon.

What it is is a bung for the only working-age demographic to have done well out of the Coalition: dual-earner couples with no children earning above average income.

What about Help to Buy itself? At the margins, Help to Buy is helping some people achieve completions – while driving up the big disincentive to home ownership in the shape of prices – and creating sub-prime style risks for the taxpayer in future.

Eden, in contrast, preferred supply-side policies: his government, like every peacetime government from Baldwin until Thatcher’s it was a housebuilding government.

Why are house prices so high? Because there aren’t enough of them. The sector is over-regulated, underprovided, there isn’t enough housing either for social lets or for buyers. And until today’s Conservatives rediscover the spirit of Eden, that is unlikely to change.

I was at a Conservative party fringe (I was on the far left, both in terms of seating and politics).This is what I said, minus the ums, the ahs, and the moment my screensaver kicked in.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.