Up From 1994

Since Franklin Roosevelt, the central liberal credo has been the use of government to benefit ordinary people. That premise is now battered--fiscally, politically, ideologically. In 1994, swing voters rejected both the concept and the party of government. The 1994 midterm election is not yet the epochal realignment that prefigures a new governing coalition and a new dominant party. But if Democrats sleep through the wake-up call and Republicans win the White House in 1996, realignment will be complete.

Thus the stakes could not be higher for Bill Clinton, and for liberals. Clinton must decide how to use his pulpit: when to conciliate and when to fight; what to jettison and what to defend; where to offer bipartisanship and where to draw partisan distinctions; what mechanisms to signal alliance with disaffected voters, absent the capacity to legislate; how to regain ground in the near term and also build strategically for the long term.

Clinton also will have to struggle to regain the affections of his own base. Richard Rothstein argues elsewhere in this issue that liberals have been too quick to abandon the president and that their faint, grudging support increased his isolation and vulnerability. Even so, the perception is now widespread that Clinton is damaged goods. If Clinton offers an uncertain trumpet, or a simple tack to the right, he will lose what remains of his liberal backing. We need to ask not just what Clinton should do, but what we should do.

At the same time, calamity can be overstated. A closer reading of voting statistics suggests that the congressional prospects for 1996 are not too bad. Despite the legislative outcome, roughly half the electorate voted for Democrats--this was not the tidal shift suggested in the early commentaries. Dozens of House seats were decided by fewer than 2,000 votes. A majority of voters with incomes under $50,000 voted for Democrats, though they turned out in lower numbers. In the Senate, the 1996 electoral arithmetic will be the inverse of 1994, with only 15 Democratic seats up, but 18 Republican ones. More statehouses and legislatures are institutionally in Republican hands, but the electorate is still narrowly divided, fluid, more "de-aligned" than realigned. It would only compound the conservative sense of smug, self-confident triumph if liberals took 1994 as a categorical repudiation of everything we believe and much that Americans value.

American voters are still schizophrenic in their public philosophy. Polls continue to show, as they have for 40 years, that voters are more liberal operationally than ideologically. They don't like the idea of government, or the taxes required to pay for it, but they value its benefits. Only a minority has the extreme anti-government view that is now Republican philosophy. But the Democrats' conundrum is that the operational part of our mixed political economy is harder to achieve.

For a generation, Democrats governed as the normal majority party because the economics and the politics of activist government could complement each other. Affirmative government delivered tangible, valued benefits--Social Security, Medicare, FHA loans, the GI bill, the interstate highway program, college aid. The very idea of government enjoyed prestige. Government cured the Depression, won World War II, organized the containment of communism, and sponsored far-flung public endeavors given legitimacy by the Cold War. Appreciative voters reciprocated. In the equation of benefit and cost, it was a good bargain.

It was also a possible bargain. The economy was mostly national, dominated by large, stable industries. On both counts, the economy was amenable to regulation and stabilization. All of this contributed to security and opportunity. Democrats were custodians of a social contract that worked, with affirmative government at its center. Having won the loyalties of voters via their pocketbooks, Democrats could spend political capital advancing riskier liberal causes such as minority rights, redistribution to the poor, and civil liberties.

And it was a viable bargain distributively. Taxes on working families remained surprisingly low until the 1970s. But then Social Security costs increased; the tax code became less progressive. What has changed is not the share of GNP channeled through government but the distribution of taxes and benefits. Young families are taxed at a much higher tax rate, while corporations and the wealthy have lower rates. A rising share of benefits go disproportionately to the elderly.

Almost every aspect of the old formula has now been negated by events. Economic growth has slowed and ordinary people are not sharing in it. Even people making ends meet feel breathless and insecure. Working families pay more of the total tax load and get back less. The icons of the era are individual and entrepreneurial, not civic and solidaristic. Fiscally, the politics of chronic deficit denies Democrats and liberals the ability to deliver concrete benefits to core constituencies. In electoral politics, money continues to drive out participation, intensifying disaffection with politics as well as with government. Meanwhile, a fractious politics of group rights and demands is stronger than ever. The core coalition, of organized minorities and single-cause liberals, is highly mobilized and often ungrateful for what it perceives as half-hearted support from the president--yet this core falls far short of an electoral majority.

Nineteen ninety-four was a rude awakening but no sudden quake. The New Deal coalition began seriously cracking 30 years ago, under the twin strains of war and race. Republicans became the normal presidential party, but Democrats kept their hold on Congress largely because of inertial loyalties and because they could continue to serve key constituencies that remained (weakly) Democratic. Congressional realignment was also delayed by Watergate, which produced both a (weak) Democratic president and a generation of Democratic congressmen who stood for procedural reform. In three distinct, reinforcing senses, dealignment and gridlock have been the norm for a political generation. The two parties have shared power, vetoing each other's grand designs, disconnecting voters from the polity, and failing to solve looming national problems.

It was the Reagan presidency and the politics of permanent deficit that set in motion the tidal wave of 1994, because they finally denied Democrats the means to serve broad constituencies via the old formula. Though Democrats could (barely) elect a minority president in 1992, the political epitaph of the 103rd Congress can be summed up in three brief words: they didn't deliver. Candidate Bill Clinton had been just enough of a populist to get elected; his campaign signaled cultural moderation and articulated the pocketbook frustrations of ordinary people. But in office he seemed a cultural liberal who failed to produce on economics.

Legislation was indeed enacted, but the high-profile achievements were either abstract products valued by economic elites--deficit reduction, NAFTA--or brave but politically risky products such as gay rights. Other legislation was necessarily token. More expansive projects such as health reform were blocked by fiscal limits, interest group vetoes, and Republican filibusters. The substantially trumped-up Whitewater scandal, the woes of old Democratic bulls like Dan Rostenkowski, the scent of sexual impropriety, and a picture of presidential vacillation all combined to suggest that Clinton and the Democrats represented everything about government that voters resented. The party of change became the party of the status quo. Republicans, as the party of anti-government, behaved with consummate cynicism, but enjoyed an almost total free ride.

In 1994, swing voters, ambivalent about government for decades, finally concluded that if government could not produce, then why pay taxes?--a view depressingly congruent with Republican philosophy.

Sooner or later, of course, the Republicans were destined to take control of the House of Representatives. It is unnatural in a democracy for one party to hold sway for more than 40 years. Given that the Democrats' hold on the House was partly inertial, that it depended on the remnants of a one-party South that took a generation to die off, given that 30 or 40 of their number voted more like Republicans anyway, and given that power really does corrupt, Democrats could not expect to be the congressional majority in perpetuity. A rotted congressional party was waiting to be knocked over by a good stiff breeze, and 1994 produced a hurricane. But 1994 may not have been such a bad year for the inevitable to occur. A de jure Republican majority bearing some responsibility is probably better than a narrow, de facto, Democratic one unable to produce.


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There is one silver lining. If pocketbook frustrations are behind much of the voter backlash, none of what ails voters in 1994 is likely to get much better by 1996. If the shift of voter affections was resounding, it was tentative. Swing voters are giving the Republicans a try, but the same angry populism could easily turn against the Republican Congress later.

Thus, the challenge for liberals is both tactical and strategic. For the long term, what kind of affirmative program is thinkable? What are our first principles? How can the party's dormant base be revived? For the near term, how can Republicans and conservatives be made to take responsibility for a philosophy and a program likely to defer solutions and to worsen voter frustrations?

Clinton must play the difficult hand history has dealt him almost flawlessly. These tactical considerations should be guided by one strategic message: The Republican program and philosophy won't repair civic life, or improve the economic lot of ordinary people. The Democratic program, given a real working majority, might.

This fight can be fought on several fronts:

Be a Teacher. The Republicans are committed to a Contract with America that is a fiscal and economic fraud. Far from embracing elements of it, Clinton needs to play the teacher. If the contract passes, it will increase the economic squeeze on working families. As Reaganomics proved, you can't cut taxes, defend benefits, and balance the budget at the same time. Democrats should expose the cynicism and hypocrisy, as well as the wrongheaded economics.

To take one example, there will be overwhelming pressure for a tax cut. If there is to be one, this is a fine opportunity to underscore vividly who speaks for whom. The Democrats should champion tax relief for working families, and fight hard for it; let the Republicans press for capital gains cuts for the rich. Win or lose, the fight is usefully clarifying.

The balanced budget amendment to the Constitution will be another sore temptation for Democrats. It was barely blocked in the last Congress. The amendment would paralyze government for the foreseeable future. Well into the next century, government's main task would be raising taxes and cutting benefits that citizens value. Activist government would be stymied indefinitely. During recessions, government would be precluded from borrowing to prime the pump.

If the amendment does get the necessary two-thirds vote in both houses of Congress, Democrats should mount a grassroots effort to block the amendment in statehouses across America. The Constitution requires an amendment to be passed by three-quarters of the states. Democrats control 18 state legislatures, and at least one house in 12 more, as well as 18 governorships. State legislatures are the right place to mount a defense because states are where liberals need to rebuild and because states will bear the brunt of the political and fiscal cost if the amendment passes. Washington would balance its own books by reducing or eliminating aid to states and cities, leaving governors and legislators with the painful choice of raising taxes or cutting services.

Clinton is at his best in the role of teacher. He warms to town meetings and kindred events where he can engage with public issues as they affect ordinary people. He needs to use such forums to make crystal clear why the Republican philosophy will not fix the economy or cure what ails voters.

The deficit, subject of more misplaced obsession, is projected to increase over the next 10 years, from its present 2.4 percent of GDP back to 3.6 percent. But more than 100 percent of that increase is projected inflation in Medicare and Medicaid. If those two outlays were held to their present share of GDP, the deficit would continue falling. So budget reform boils down to health reform. Clinton needs to get that story out. He needs to oppose simple-minded deficit hysteria, and make the case for substantive reforms instead.

Be a Chief Executive. Under our system, the president is the chief executive, not the chief legislator. Conventionally, of course, presidents are measured by the legislation they enact--Roosevelt's first hundred days, Johnson's Great Society, Reagan's tax cuts and military buildup. But progressive legislation in this Congress is simply not in the cards.

What the president does have is enormous administrative latitude, both to make policy and to manage the government better. Vice President Gore's National Performance Review is not a one-shot public relations stunt, but an ongoing enterprise. Democrats ought to run the government better, because they believe in it more. This can have several distinct payoffs. First, it can save money. One little publicized Clinton administration initiative is procurement reform. Government buys billions worth of goods and services, much of it inefficiently. As Ralph Nader and colleagues have argued in these pages, government procurement reforms can also make policy. Environmental standards in government procurement, for example, are the policy equal of new legislation, even though they can be done by regulation.

Making policy by regulation will be harder given a hostile majority in Congress. But Reagan managed it. Here again, Clinton needs to pick fights that usefully clarify that he is on the side of ordinary people, win or lose. For example, one trend adding to the economic insecurity of ordinary people is the shift to temporary and part-time work. Here, the Labor Department has enormous administrative latitude under ERISA, OSHA, and the Fair Labor Standards Act, to discourage employers from re-defining full-time, permanent jobs as part-time temporary ones.

Much of what the government does involves collecting data, keeping records, paying benefits. As government record-keeping is efficiently automated, the payoffs in cost-savings and consumer satisfaction are potentially immense. With a vice president who is a technology buff, the Clinton administration ought to be at the cutting edge of bringing government into the information age.

A dollar liberated by efficiency gains buys just as much as a dollar borrowed or taxed; it is all government has when borrowing or taxing are foreclosed. This part of the "New Democrat" agenda makes sense. It also steals the Republicans' clothes that are worth stealing. The press is conditioned to view legislation (or its blockage) as a front-page story, and public management as a non-story. But that can be changed. Some stories of making government work better are actually interesting.

Offer a High Road of Bipartisanship. In our own times, divided government has meant blockage. A generation ago, divided government actually produced consensus and legislative compromise. The zenith of that era, it pains me to say, was the presidency of Richard Nixon, who was viciously illiberal on many fronts but also fancied himself something of a progressive conservative on social legislation. With Democratic majorities in both houses, the Nixon era saw legislative progress on environmental legislation, expansions of Social Security, OSHA, and the like. Nixon even flirted with universal health insurance and a guaranteed annual income.

The Republican party, of course, is far more conservative today, but there are still areas of bipartisan overlap. Some Republican legislators do recognize that there is a health crisis. Some are concerned about the effects of defense cuts on their local econo- mies. Some favor lobbying and campaign finance reform. Some even favor preventive anticrime measures. Taken out of the context of a bitter midterm election, some constructive compromises could command bipartisan support. In areas where there is a real prospect of success, it won't hurt for Clinton to invite Republican leaders into the strategizing. But in signing compromise legislation, Clinton needs to be crystal clear about how much more he might have done with a working progressive majority.

But Be a Fighter, Too. To submerge partisan difference into an essentially conservative consensus--reduce the deficit, cut public spending, deregulate, privatize, marketize--moots the rationale for a Democratic party. A lot of the Republican program is nonsense. At this writing, it is energizing to hear Alice Rivlin, David Bonior, and others, say so.

Even as he compromises on some measures, Clinton needs to constantly remind people why they sometimes vote for Democrats, and to revive the party's workaday base. By doing so, he will also revive the polity. Clinton was elected as a force for change, a champion of working families. Republicans can pose as the former, but not the latter. At best, they can appeal to working families' fears of crime, of racial minorities, of taxes. The 1994 election underscored that deep demands for change are still out there. Clinton can put forth some far-reaching proposals that won't be enacted in this Congress, just to make clear where he stands, and to build for next time.

One key failure of the 1994 campaign was the Democratic party's feeble and belated effort to motivate the party's base. Voter registration, mobilization, and get-out-the-vote took a back seat to fundraising and using the party as a lobby for White House legislative goals. After several years of effort, Congress finally enacted the motor-voter bill. Democrats hardly used it. As we move into the gravitational field of 1996, it remains the case that wage-earning people vote for Democrats (sometimes) because they think Democrats stand for economic opportunity and security for ordinary people, and Republicans don't. Clinton needs to reclaim that mantle for the party and for himself.

In 1994, as aging southern Democrats continued to retire or die off, the trend continued of conservative Republicans replacing moderately conservative Democrats in the South. Running as center-right Democrats didn't save candidates like Jim Cooper, the man who spent much of 1994 undercutting the Clinton health initiative. If Democrats are to win even some seats in culturally conservative regions where there is little progressive infrastructure, they will do it by running as economic progressives, offering something to wage earners otherwise vulnerable to the rough justice of raw capitalism. The deeper forces constraining economic opportunity and civic vitality will not be resolved in the next Congress. But if they are clear about what they stand for, Clinton and the Democrats can position themselves to fight another day.

The 1994 election either presages a Republican realignment, or a period when a justifiably surly and fickle electorate is still up for grabs. Which will it be? The forces suggesting realignment include these:

  • Fiscal blockage makes it harder to do anything tangible for the base Democratic constituency other than to cut their taxes. Sym- bolic politics and pilot programs won't help much. A politics of scarcity will increase Democratic fractiousness.
  • The South is likely to become more Republican as time goes on. The creation of racially gerrymandered districts only accelerated the trend, and backfired on both Democrats and blacks. A two-party South emphatically requires biracial coalitions on pocketbook issues.
  • White male support for Democrats may continue to erode. Many white men resent affirmative action. Southern white men are among the most culturally conservative of sometime Democrats. Traditionally male blue-collar jobs that paid a living wage are disappearing.
  • Term limits, as a substitute for reform of the money-and-politics nexus, would only intensify the polity's Republican and conservative tilt. Democrats in Congress depended too heavily on incumbency. By using incumbency to raise special interest money, they were both pushed to the right and spared the need to mobilize the party's dormant base. But a political system in which all seats come open every few years and in which candidates can spend unlimited money portends more Michael Huffingtons and more Democrats who adopt economic positions at odds with their natural base in order to be financially competitive.
  • Unless he does nearly everything right, Clinton could prove a personal liability for Democrats. Congressional Republicans can now conduct Whitewater fishing expeditions. If Clinton is personally discredited, either by Whitewater or by the perception of vacillation, his own unpopularity could supercharge the conservative trend.

On the other side of the balance sheet, the new Republican congressional majority cannot expect a free ride from the voters either.

  • Gingrich and Dole will increasingly get bad press. Neither man is likely to wear well. Despite their insurgent pose, both are up to their ears in special interest money. Both have a nasty streak. Gingrich is culturally far to the right of the country. The press will find plenty to criticize about the new incumbents.
  • Nothing the Republicans do will change the underlying economic insecurity of the average man and woman. Because of the same deficit logic that paralyzes, any tax relief the Republicans deliver will be token. Even draconian anti-crime measures are unlikely to change the reality on the street. If the mood continues to be sour, there will be a backlash against the GOP.
  • There are profound contradictions in the conservative world view and in the voter embrace of it. The party that celebrates the open global economy is also the party of California's anti-immigrant Proposition 187. People who are fearful of job loss and downward mobility resulting from greater economic turbulence voted for the party of laissez faire. People who wanted tax relief and deficit reduction voted for proponents of a Contract with America that will make both goals harder to achieve. The party of personal liberty wants prayer in school and state regulation of women's reproduction.
  • The smaller congressional Democratic delegation is likely to be a more coherent and effective one. The election thinned the ranks of the party's DLC wing, and the party that remains is likely to be clearer about what it stands for.

Democrats and liberals can wrest the working middle class away from its unnatural liaison with ultraconservatives only if they are clear about what they themselves believe and have the courage of their convictions. Clinton has a choice of two governing scenarios. One begins to rebuild the party base; the other offers a pale version of the Republican program. But slightly more moderate versions of welfare crackdown, or modified school prayer, or retrenchment on gay rights, or longer prison sentences, won't reclaim voter affections. If Democrats fail to restore allegiances based on pocketbook affiliation, they will be swamped by social issues.

Clinton's choice of where to block and where to compromise will also influence the stories that both parties are able to tell two years from now. When the lot of the average person is not improved, the right will doubtless insist that Clinton is to blame for having blocked its program. Clinton needs to be constantly stressing why the Republican Contract will do little for the average person. The worst temptation is to let the shell shock of defeat lead Democrats to accept 1994 as a Republican mandate, and to presume that their task is to become more like the Republicans.

The new political era contains the risk not just of partisan blockage but of deeper social and economic stalemate. At stake is not just who will govern but whether the civic and social fabric will hold. A failed Republican program of laissez faire will intensify the poisonous mix of downward mobility and racial resentment. It will fuel the politics of voter backlash and plain demagoguery. Even worse than realignment, we may see a politics of permanent fury. To discern a liberal high road that can offer both authentic remedies and effective politics is no easy task.

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