The startling collapse of communism, not with a bang (except in Romania) but a whimper, presents the democratic world with a new array of challenges. For the United States, an age of military competition with the Soviet Union is coming to an end. In its place looms a new age of economic competition. The chief rival is no longer the communist foe that has preoccupied American policy for forty years. The chief rivals today are, ironically, the nations the United States, Britain, and the Soviet Union defeated in the Second World War -- Japan and Germany -- now the most dynamic and thrusting economic powers on the planet.
Our very passion to win the military competition may well have disabled us in the economic competition. Seventy per cent of federal research and development spending has gone to the military. The defense program has withdrawn American scientists, engineers and laboratories from productive work in the civilian economy. In the meantime, Japan and Germany, happily liberated from defense burdens, were free to develop the technologies that will rule the future.
In the longer run, the diversion of resources to an insatiable defense program has crippled investment in industrial modernization, in education, in infrastructure, in medical care, in housing, in clean air and water -- in all the elements that undergird a growing economy and a skilled and healthy labor force. Moreover, the run of unprecedented budget deficits has led to the fire sale of American assets to foreign investors and left the U.S. economy as never before at the mercy of decisions taken by foreigners.
Just as Russia-bashing was a major theme in the Cold War, so one sees the growing temptations of Japan-bashing and Germany-bashing in the age that lies ahead. Now the basic containment policy has been amply vindicated by the mellowing and/or break-up of the Soviet empire that George Kennan predicted forty years ago. Still, the distortion of containment in the 1950s into an obsessive and sometimes hysterical anticommunism became, as Kennan also noted, an awful source of error, folly, and criminality in American foreign policy. The demonization of Japan and Germany could easily become an equal source of trouble.
Japan-bashing and Germany-bashing constitute a formula for escaping our difficulties, not for solving them. The American problem is not Japan or Germany. The American problem is America, and the solution depends on our capacity to identify our dilemmas and to design remedies to overcome them. Let us not suppose that the failure of Russian communism means the success of American capitalism. The Philadelphia Inquirer had a splendid cartoon the other day: Uncle Sam perched on a ladder watching the communist world through binoculars and exclaiming "Imagine! Communism just self-destructing like that!" -- while behind his back are homeless people, dilapidated schools, soup lines, drug sales, and hold-ups.
Solving the American problem provides a special opportunity for liberals. The laissez-faire market beloved of conservatives cannot meet the challenge of national renovation. Indeed, the deregulated market is the cause of many of our troubles. The age of economic competition, like earlier times of economic crisis, calls for a renewal of affirmative government and therefore for liberal remedy.
And the new age will provide liberals with new political opportunities. Anticommunism has been the ligature holding the conservative coalition together. As the issue that united conservatives fades away, those incongruous allies -- establishmentarians, entrepreneurial hustlers, evangelical zealots, libertarians, global crusaders, isolationists, anti-abortionists, the gun lobby and so on -- will increasingly argue about the issues that divide them, and the coalition will begin to fall apart.
These developments -- the substantive need and the political impact -- should solidify the cyclical change that, if the rhythm of our politics holds, impends in the 1990s. History shows a fairly regular alternation in American politics between private gain and public good as the dominating motives of national policy. From this perspective the Reaganite private-interest 1980s were a reenactment of the Eisenhower 1950s, as the 1950s were a reenactment of the Harding-Coolidge-Hoover 1920s. As each conservative phase runs its course, the republic turns at 30-year intervals to public action -- Theodore Roosevelt ushering in the Progressive era in 1901, Franklin Roosevelt the New Deal in 1933, John Kennedy the New Frontier in 1961 -- until each liberal phase runs its course too.
There is nothing mystical about the thirty-year cycle. Thirty years is the span of a generation. People tend to be formed politically by the ideals dominant in the years when they first come to political consciousness. Young people who grew up when Theodore Roosevelt and Woodrow Wilson were setting the nation's sights -- Franklin Roosevelt, Eleanor Roosevelt, Harry Truman -- reaffirmed the goals of their youth thirty years after in the New Deal and the Fair Deal. Young people who grew up when FDR was inspiring the country -- John Kennedy, Lyndon Johnson, Hubert Humphrey, Robert Kennedy -- brought the New Deal up to date thirty years after in the New Frontier and the Great Society. In the same manner John Kennedy touched and formed a political generation in the 1960s. If the rhythm holds, that generation's time will arrive in the 1990s.
These are cycles of opportunity, not cycles of necessity. They do not dictate the future. Liberalism will not reach home by a base on balls. As the national mood swings back and forth, new leaders arise and confront new possibilities. What the leaders make of these possibilities depends on their own ideas, capacities, skills, visions. A passive Coolidge will make one thing of a conservative era; an accommodating Eisenhower another; an ideological Reagan still something different. FDR did one kind of thing with the 1930s. Had Giuseppe Zangara succeeded in killing him in Miami before the inauguration in 1933, John Garner would have done very different things with the 1930s. The coming phase of the cycle offers no more than an opportunity for new departures. What we will do with it is up to us.
Is the cycle in fact turning? The astute conservative analyst Kevin Phillips recently noted that a new liberal phase is emerging not only in the United States but in the six other leading industrial democracies. "The result so far," Kevin Phillips writes, "has been the West's first international political cycle. There has been an unprecedented conservative coloration on the last ten years of politics and policy-making in the world's principal economies. But the next megacycle ... could easily be more to the center-left as a reaction to the conservative excesses of the '80s."
Louis Harris's polls bear out the Phillips curve. Americans, the polls report, now want a more activist government by two to one. When asked about specific issues -- protection of the environment, helping the homeless, fighting drug addiction, providing affordable housing, ending racial discrimination -- the pro-government majorities range from 73 to 92 percent. After the November 1989 election, Harris found "a political shift in the wind against anti-government Republican conservatism equivalent to that against pro-government Democratic liberalism during the late 1970s and 1980s."
Further evidence that the tide is turning lies, paradoxically, in George Bush's invocation of a kinder, gentler America. The new President's inaugural rejection of materialism and greed, his call on Americans to fulfill themselves by serving others, his declarations of concern for education and the environment and public ethics and homeless children, his retreat from hard Reaganite rhetoric on civil rights, the Reagan Doctrine, savings-and-loan deregulation, Star Wars, Contra aid, and gun control, his budget director's attack on instant gratification and "now-nowism," his administration's expansion of regulation in automobile safety, job safety, environmental protection, and other fields: all these departures from true-blue Reaganism represent a shrewd response to the impending change in the national mood.
The President's strategy is to proclaim a fervent commitment to liberal goals and then to add that it is just such a gosh darn shame that the national government can't do much to achieve these goals. This strategy has worked well enough so far, but it is bound to wear thin. The Bush administration increasingly reminds one of the old Chinese saying: "There is a lot of noise on the stairs, but no one enters the room."
The gap between expectations raised and results attained will become increasingly painful. Consider the effort to push off on the states the costs of national programs like the drug war and Medicaid. "Washington has gone from revenue sharing to revenue bleeding," Governor Blanchard of Michigan has observed -- "a sentiment," The Wall Street Journal assured us (in its news columns), "increasingly voiced by governors of both parties and many shades of ideology."
It is time for liberals to expose the presidential strategy of announcing objectives and denying the means for their accomplishment. "President Bush has done all he can with speeches," Governor Cuomo said in California last October. "Now he has to produce resources that will deliver on his promises or concede to the nation that he is still an unconverted conservative who has simply tried to earn himself some cheap grace by reciting a little Democratic poetry"
Yet for the moment, because of the caution, the diffidence, and the perhaps exaggerated sense of statesmanlike obligation on the part of the Democrats, the President is preempting the cyclical change. When on inauguration day Mr. Bush replaced the portrait of Calvin Coolidge that Ronald Reagan had hung in the cabinet room with a portrait of Theodore Roosevelt, it was a warning that liberals might well heed. If George Bush could really transform himself into Teddy Roosevelt (in domestic policy as well as in Panama), the Democrats might be in serious trouble.
How should liberals take advantage of the turning tide? We might well start by getting off the defensive about liberalism itself. While George Bush calls for a kinder, gentler America, a small but noisy faction in the Democratic Party would have Democrats call for a meaner, rougher America: big defense budgets, aid to the Contras, more Grenadas and more Panamas, and so on.
These Reaganite Democrats also join with the right-wingers in trying to identify liberalism with the hippie radicalism of the 1960s. Of course, the attack on reason and celebration of violence that streaked the later part of that decade was the antithesis of liberalism. The SDS and the Weathermen notoriously hated liberals and denounced them as the mortal enemy. It is a little hard now to blame liberals for the follies of the illiberal left.
Liberals have been unduly acquiescent in face of this barrage -- disastrously so in the 1988 presidential campaign. Polls show FDR, Truman, and Kennedy to be the three most popular Presidents of the century -- all liberals. Why was this not a tradition to be claimed -- and proclaimed? To allow the foes of liberalism to define liberalism is political nonsense. To allow liberalism to be blamed for everything bad that happened to the republic from 1961 till Ronald Reagan rode his white horse into Washington in 1981 is historical nonsense.
In fact, there has not been a liberal administration in Washington since the Great Society sank into the Vietnam quagmire in 1966. Nixon a liberal? Ford a liberal? Carter, the most conservative Democratic President since Grover Cleveland and almost as diligent a critic of affirmative government as Reagan himself, a liberal? Someone must be kidding. For better or for worse, conservative government is accountable for the present state of the nation.
And, despite surface appearances, the republic is in grave trouble. We will be paying the bills of Reaganism for generations to come. There are first the bills rendered by the singular incompetence and crookedness of an administration populated by ideologues and hustlers and committed to doctrinaire deregulation -- $200 billion or more to bail out the savings-and-loan associations; $200 billion to clean up the environmental threats emanating from our nuclear plants; $100 billion to clean up toxic waste dumps; more billions to bail out the farm credit system and to root out the fraud in the Federal Deposit Insurance Corporation; heaven alone knows how many billions in the Housing and Urban Development scandals and the Pentagon procurement scandals.
To President Bush's credit he has moved to deal with some of these scandals, especially in FMD. But why have the Democrats failed to drive home the lessons of Reaganism? The parade of scandals in both public and private sectors is the predictable result of national leadership that gave the pursuit of self-interest moral priority and sabotaged the machinery of regulation in the public interest. Why have not the Democrats convinced the voters of the inevitable consequences when mindless deregulation is combined with boundless greed?
One hates to think that it may be because too many Democrats have been feeding out of the same troughs. Can the party of Roosevelt, Truman, and Kennedy now be selling itself to the developers, the saving-and-loan thieves, the timber barons, and the LBO artists? And too many Democrats also acquiesce in the budgetary shell game taking place in Washington today -- the removal of embarrassing expenses from the budget, the use of the Social Security reserve to reduce the deficit, and the other sleight-of-hand tricks designed to fool Americans into thinking that our government's fiscal condition is healthier than it is.
In the long run the structural bills of Reaganism will cost the republic even more than the scandals. The Reagan years brought about the transformation of the United States from the world's largest creditor into the world's largest debtor. These years have resulted in declining American competitiveness in world markets, in the sale of American assets to foreign purchasers to finance a domestic spending spree, and in the consequent increase in economic vulnerability and decay of world influence because, as Senator Moynihan has well said, "It is an iron law of history that power passes from debtor to creditor." At home we have seen the crumbling of our educational system, the slowdown on racial justice, the spreading obsolescence of our national infrastructure, the shortfalls in housing, the profit-driven assaults on our environment, the profit-driven undermining of consumer protection, the yawning gaps in health care, the widening income gap between rich and poor.
The new administration refuses to recognize these structural problems. Its grand economic initiative is the reduction of the capital gains tax. This proposal is a textbook example of what Richard Darman called "now-nowism." Capital gains reduction would encourage the rich to speculate today, might briefly increase tax revenues tomorrow -- and would surely deepen our troubles next week.
As for the Democratic conservatives, they are hardly more inclined than the administration to confront the structural challenges. Their basic argument is that the liberal approach is politically disastrous. The desirable location in politics, they contend, is the middle of the road. Their political hero should be that seventeenth century English politician known as Halifax the Trimmer.
I doubt that a more misleading political maxim has emerged in our time than this one about the supreme virtue of the middle of the road. Consider the most successful American political leaders of the century -- Theodore Roosevelt, Woodrow Wilson, Franklin Roosevelt, Harry Truman, John Kennedy, Ronald Reagan; or, if you want to go abroad, consider Margaret Thatcher. These leaders were not middle-of-the-roaders. They were not trimmers. They were what Mrs. Thatcher calls "conviction politicians" -- leaders with deeply-held beliefs that they stood by and fought for in bad times as well as good -- the kind of leaders liberalism deserves today.
But getting off the defensive can only be the beginning. The harder part is to get our ideas straight. We must recall what politics in a democracy is all about. We are often told that politics is about power, and that is of course true. More recently, it is said that politics in the age of the mass media is about image; I fear there is something in that too. But in a democracy politics is about something more than the struggle for power or the manipulation of image. It is above all about the search for remedy. No amount of power and public relations will avail if, at the end of the day, policies do not work.
As Bryce put it so well a century ago in The American Commonwealth, "In a country so full of change and movement as America, new questions are always coming up, and must be answered. New troubles surround government, and a way must be found to escape from them; new diseases attack the nation, and have to be cured. The duty of a great party is ... to find answers and remedies."
The liberal answers of the past were not infallible. Affirmative government sometimes tried to do too much. Regulations became intrusive and burdensome. Government programs miscarried. And the public interest, liberals must understand, is something more than, and very often different from, the sum of the interests of organized groups in our society.
The specific experience of the liberal past will be of only limited benefit in finding remedies for the future. The particular policies liberal Presidents advocated in other times were addressed to the particular problems of those times. New problems demand new remedies. Still, the spirit behind past policies abides and refreshes. The task that confronts us today is to apply the creativity of liberalism to the structural problems that are setting us on the course of national decline.
The republic is in a bad state of disrepair. The national needs cry out: investment in research and development, industrial modernization and other means of increasing productivity; investment in education for a high-technology age; investment in the rehabilitation of our collapsing bridges and dams and roadways and waterways; investment in the protection of this once green planet against toxic wastes, acid rain, the depletion of the ozone layer, the greenhouse effect, and other environmental scourges; investment in the struggle for racial justice, in the rescue of our cities and in the redemption of the underclass; investment in the war against crime and the war against drugs (and I might say parenthetically that there is no incompatibility between social liberalism and tough law enforcement: recall Robert Kennedy or consider Robert Morgenthau in New York City today). The market will solve none of these problems. The case for affirmative government is overpowering. Imperious circumstances, in short, demand liberal solutions.
But President Reagan discovered what had eluded his conservative predecessors: a means of blocking the enlargement of social programs. By contriving unprecedented budget deficits, he has denied liberalism flexible use of social spending for a while to come. The end of the Cold War will presumably bring the famous "peace dividend," but it is not at all clear how much of this will be available for public investment. Both deficit reduction and reconversion to a civilian economy with provision for retraining and relocation will assert prior claims. And the Reagan-Bush "read my lips" crusade against new taxation (apart of course from further tax reduction for the rich) gravely obstructs the necessary mobilization of resources.
Here, too, faint-hearted Democrats have joined -- some have led -- the attack on a truly progressive income tax, the basic reform sponsored in another age by that famous radical Cordell Hull. In supporting the tax law of 1986, as Kevin Phillips has well said, Democrats were trapped "into accepting themes and realities scarcely imaginable for the party of Roosevelt and Truman." In voting to reduce the top individual tax rate to 28 percent, "Democrats not only betrayed their political traditions, they signed away credibility."
The no-new-taxes pledge threatens to condemn us to something like impotence. We can't aid Eastern Europe very much; we can't repair our infrastructure; we can't protect our environment; we can't help our cities -- because we refuse to mobilize the resources available in what is still probably the richest country in the world. As Felix Rohatyn said recently, "The unfortunate legacy of Ronald Reagan is firstly his brilliant success at convincing the people of this country that they're overtaxed with a top rate of 28 percent, which is ludicrous, and secondly the notion that government is the enemy. You can't function in an advanced industrial society with these two notions."
Worse, legislators are convinced that to advocate a tax increase is political suicide, so we can't even have a national debate on the question. There is little more important today than the creation of an atmosphere in which it is possible to discuss higher taxes for the purposes of national renovation. After all, as justice Holmes said, "Taxes are what we pay for civilized society."
But, even with increased revenues, there remain hard questions to which no one presently knows the answers. How much of an obstacle should budget deficits really be to social programs? Most economists think the deficit is a danger; but some, like Robert Eisner and Robert Heilbroner, argue that the danger is overrated. How much federal money can be liberated by a shift in current priorities? If we can find $200 billion to rescue the savings-and-loan industry, why can't we find a fifth of that amount for education or for the war against drugs?
How do we go about increasing productivity in the American economy? How do we stop the deindustrialization of America without falling into beggar-thy-neighbor policies of economic protectionism? How to bring education and employment into inner-city ghettoes? How many homeless people are there and what can we do about them? There are many other such questions -- some of which will never be answered by analysis but only by experiment.
The liberal revival requires not only fresh experiment but unified action. The liberal movement has shown a recent tendency to splinter into a variety of single issue caucuses. No doubt the issues are virtuous, and the desire to give every group a voice is virtuous too. But it is a mistake to insist on any single issue as the sole test of political acceptability. Liberals must resist sectarian veto-groups. Liberalism must recapture its earlier meaning as primarily concerned with the expansion and redistribution of political and economic opportunity and not appear as a catch-all for a miscellany of cultural and ideological demands. Liberal leaders must regain a commanding national vision of the problems and prospects of the republic.
Liberals might well renew the idea of a "concert of interests" so compellingly advanced by Franklin Roosevelt half a century ago. The alternative to the concert of interests, FDR said, would be "to go from group to group in the country, promising temporary and oftentimes inexpedient things." He did not believe that you could achieve liberal objectives if liberals pursued special agendas at the expense of common goals. "Each unit," he said, "...must think of itself as part of a greater whole; one piece in a large design." Nor, in defining that large design, can liberals forget that America remains a basically middle-class society and that even most of those who do not qualify economically for the middle class are moved by middle-class aspirations.
The new age of economic competition makes it more necessary than ever to begin the task of national renovation, to regain American competitiveness in world markets, and to recover influence in world affairs. Our foreign policy in this new age should be neither global interventionism as proposed by Charles Krauthammer nor neo-isolationism as proposed by Pat Buchanan. The liberal position should remain that of responsible internationalism based on sober assessment of American interests.
Right-wing Democrats as well as Republicans allege that liberalism implies indifference to the security of the republic. Those who levy such charges have short historical memories. It was liberals like FDR, Harry Hopkins, Henry Morgenthau, and Harold Ickes who led the fight against conservative opposition to build up our Army and Navy and to mobilize our economy in the years before Pearl Harbor. It was liberals like Harry Truman, Dean Acheson, Averell Harriman, George Kerman, and Clark Clifford who led the fight against conservative opposition for the Truman Doctrine and the Marshall Plan and the restraint of Stalinist expansion in the years after the war. Liberals today are just as prepared as these eminent predecessors to use military force in defense of vital American interests.
But two points should be emphasized. The first is that, while liberals believe in the firm defense of vital American interests, they are skeptical of ideological crusades that involve the United States in grandiose dreams and futile wars beyond our zones of vital interest. That is why liberals came to oppose the needless and fruitless American intervention in Vietnam. And they are skeptical of bullying intervention in the internal affairs of small countries that are no conceivable threat to the security of the United States. That is why liberals opposed the Reagan administration's policy toward Nicaragua and Panama.
The second point is that liberals have always opposed and exposed waste and fraud in the defense industry. They do not take the military seriously as judges in their own case. Harry Truman became President of the United States because of the great work of the Truman Committee in uncovering graft and waste in military spending. A liberal administration would not tolerate those swollen budgets that do less for national defense than for crooked defense contractors and their crooked coconspirators in the Pentagon.
Above all, liberalism proposes to seize the opportunities for peace. I write as a Cold War liberal -- and an unrepentant one at that. I saw nothing in common between liberalism and Stalinism either as to means or as to ends. The Cold War expressed an authentic opposition between two profoundly antagonistic philosophies of government and life.
But the Cold War as we have known it is over. The internal contradictions of communism have turned out to be far more destructive than the internal contradictions of capitalism. Democracy has won the political argument. The market has won the economic argument. It is time to move on.
Unfortunately, in the course of the 1950s the Cold War was institutionalized in both superpowers. In the United States agencies like the Pentagon and the CIA developed a bureaucratic stake in the Cold War. Their power, prestige, and budgets depended on the Cold War. Government officials invested their careers in the Cold War. And today agencies and officials retain a heavy vested interest in the prolongation of the Cold War. It is the story of their lives. They fear uncharted seas. As Lawrence Eagleburger, the Deputy Secretary of State, put it the other day, "For all its risks and uncertainties, the Cold War was characterized by a remarkably stable and predictable set of relations among the great powers."
Remarkably stable? That is hardly the way one saw it at the time. My memory is rather one of scary crisis after scary crisis. I cannot bring myself to regret the end of the Cold War. Of course new perplexities lie ahead; they always do. But that is the nature of life. And the great danger now is that nostalgia for those good old days of the Cold War may prevent our government from rising to the historic occasion, from giving generous aid to the countries of Eastern Europe, and from working out with the most reasonable regime in Soviet history arms control agreements that will institutionalize the end of the Cold War. We stand at a turning point in history, and we must not kick it away.
There is no need to be defensive about liberalism. For the events convulsing the communist world today magnificently vindicate the liberal faith. When Franklin Roosevelt became President at the depths of the Great Depression, many saw only two choices: the laissez-faire alternative -- political freedom combined with economic collapse; or the totalitarian alternative -- economic security (it was supposed) combined with political tyranny. Against this grim either/or choice Roosevelt offered a third possibility: a mixed system that gives the state the power to expand economic and social opportunity without giving it the power to suppress political opposition and civil freedom.
This was the New Deal -- the rules of the economic game redefined to replace the dog-eat-dog market by the socially responsible market. And the market currently sought by countries groping their way out of communism is not at all the laissez-faire market -- the market that gave us sweatshops, child labor, pollution, unemployment, class war and the Great Depression. They want the New Deal social market -- the market that, while retaining private ownership and the price mechanism, humanizes capitalism, rescues it from its own contradictions, and refutes Marx's apocalyptic prophecies.
History has tested and vindicated liberal principles throughout this cruel century. But liberal principles are not self-executing. The labor of democracy is unending. The challenge to American liberal democracy in the coming age of economic competition is acute. The United States, despite civil wars, world wars and depressions, has had something of a free ride through history. But our time of immunity is running out.
As Woodrow Wilson put it a century ago, "America is now sauntering through her resources and through the mazes of her politics with easy nonchalance; but presently there will come a time when she will be surprised to find herself grown old, -- a country crowded, strained, perplexed,-when she will be obliged ... to pull herself together, adopt a new regimen of life, husband her resources, concentrate her strength, steady her methods, sober her views, restrict her vagaries, trust her best, not her average, members. That will be the time of change."
The time of change foreseen by Woodrow Wilson is now upon us.
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