27 June, 2022


Will Obama Be Bolder Now?

By Kumar David


Prof. Kumar David

Obama’s failed first term can be a stern nurse :Will Obama be bolder now?

Obama won, and his victory speech was soaring rhetoric, again; on the morrow it was back to the hard grind again for America. Whoever won, the next four years was going to be much the same. The space for manoeuvre in the thick of a ruinous economic global and American downturn, a depression that will drag on for years more, is very limited. The foreign policy scene is equally tight and what either can achieve, and more likely not achieve, is not very different. Economic policy differences can be whittled down to minor point scoring; but more on that anon.

On foreign policy you have to be a nanotechnologist to detect minute differences in nuance between the campaigns. Romney said he would do the same as Obama in respect of Iran’s nuclear programme and Pakistan’s relationship with Islamists, just been tougher. This is nothing more than that a Republican must appear rougher, tougher, uglier and more redneck. There was a time, the John Foster Dulles era, when America was indeed bully of the world and imperialist nurturing dictators in every quarter. Those days are gone; now it’s a multi-polar world and Romney knew it.  America has to play by rules set by others including China,Russia and the oil rich Arabs.

In setting the relationship between America and China, the most important determinant of the Twenty-first Century global scene, the subjective predilections of the two candidates matter not even at the margins. The fundamental variables such as China’s political evolution, economic balances between the protagonists, and global and regional strategic and military poise, are too big to be shifted by placeholders even as powerful as the president of the United States. We are in the most objectively determined period in world history since the end of the Second World War.

Economy: Irrelevance of the candidates

Obama could not tell the people the truth about the economy during his first term. It is very likely that in the first two years neither he nor his economic advisors, non-Marxists of course, understood what they were up against; a calamity rooted in the very DNA of the system; not a recession or another turn of the business cycle, but a prolonged new depression. Already it is four year’s old and not yet half way through. Its passage will entail more businesses closures and impose more hardship on the 99%. No longer is it Cassandras like me, it’s the IMF and its ilk that see long hard days ahead for global and American capitalism. Certainly now this is clear to Obama and his team, but how could he have told the people that during his first term? How tell them the very system is buggered and hard days and years lie ahead and still hope to win elections?

The Federal Reserve Bank’s response has been to print cartloads of money and call it Quantitative Easing (QE). Actually it is bastard Keynesianism; bastard because instead of kick-starting production and infrastructure to spur demand and employment you siphon dollars into moribund financial enterprises and toxic bonds bubbling up prices of equities and assets. It worsens wealth and income inequality and prepares the ground for another bust. The new cash sloshes around in a liquidity trap as if in a sticky sump; investment falters. QE has merely raised asset prices, thereby increasing the gap between workers and asset-owing class, without increasing productive capacity, that is, it has increased paper wealth, not real wealth.

In Europe (Britain,Spain,Greece,Portugal and Italy) they are going in exactly the opposite direction. Austerity, belt-tightening to starve the population till surplus value is propped up to a rate adequate to stimulate limp capitalism into tumescence is not working either. Economies still stagnate, debts rise, unemployment is stubborn and general strikes become a way of life in Europe.

The point of all this is this; whatever Obama did, it would not have mattered, the US economy would have remained on life-support last four years and will remain so for another four. Tweedledum instead of Tweedledee, Romney instead of Obama, the crisis of American capitalism is not subjective; the torture cannot be short-circuited. What really were the economic policy differences during the campaign anyway? Romney said he would repeal Obama’s healthcare legislation; but he wouldn’t, just face saving amendments. He said he wouldn’t raise taxes but under the whiplash of rising debt and deficit he would have done otherwise. Romney would have had no choice but to conform to the monetary policy that the Fed has consistently implemented since late 2007.

A democratic plutocracy

In describing America as a plutocracy I am not pointing to the larger question of obscene inequalities in wealth and income across society. The Occupy Movement has revelled in the statistics of the 1%, the 10%, the 99% and the 90% which are now as well known as the Lord’s Prayer. True, democracy is not unqualified egalitarianism, I grant that. But it cannot be democracy if the aberration in inequalities of power, and in the distribution of wealth and income, are obscene. This manifests itself in a concrete way in the just concluded presidential elections.

First, a candidate for the presidency or Senate or Governorship must of necessity be very rich, maybe a millionaire. Romney and Obama busted over $1 billion on television advertising. The blast of TV advertising simply reduced the public to a state of shock and awe. The impact was on the conscious mind and it was subliminal. This is not democracy, the exercise of choice by the people; this is driving voters to the ballot box with their reflexes conditioned like the Lysenko’s puppies! The $1 billion, the power of plutocrats, has brought the American electorate to the status of television zombies.

The second way in which American plutocracy is concretised at election time is the sources from which finances must be raised. These monies do not come from the widow’s mite and the student’s dollar, no the main contributors are big businesses; corporations, Wall Street and the wealthy. The total spent by both sides in the campaign was over $2.5 billion. Big money extracts its pound of flesh afterwards, from presidents in hock to donors. The conservative dominated US Supreme Court made this circus worse by a recent ruling that lifted the cap on contributions provided the money is not fed directly to the candidate, but to parallel “independent” entities to use at their discretion. The conduct of the Obama and Romney campaigns exposed the reality, it showed up the charade; the Courts nice distinctions amounted to opening the back door for big money to run riot. The truth about American democracy is that money talks very loud.

A third aspect of American plutocracy is Congress; both Senate and House of Representatives are stuffed with incumbents beholden to wealthy business interests and special interest groups. About 90% of Senators are re-elected term after term and some have been sitting members for decades, this allows powerful interest groups to hold veto powers over economic policies and to dictate fiscal and taxation policy.

These considerations do not vitiate the case that America is a democracy in the sense that voting, speech and the media are free. What they do imply is that the relationship between democracy and plutocracy is more complex than meets the eye. There is no denying that stuff that matters to ordinary people generate passion and motivate the swing of votes; jobs, housing, education and the size of government. The election very much illustrated democracy in motion and I will not for a moment belittle it. Even the white racist backlash against Obama, though ugly, is an expression of people’s will. How can we living in glass houses in this country throw stones; will a Muslim or a Tamil ever become president of Sri Lanka?

However, American democracy is a process that unfolds within constraints limiting spaces in very significant ways. Money matters in elections in every democracy, far more in the US than say in Europe. But there is something special about the way it happens in the US. In say Lanka,India,Asia and many parts of the world, money paves the road to corrupt electoral practices and influences choices in constituencies. However, in Americaa plutocracy of 1% has created an ethos in which presidential and senatorial contenders have their options confined within class and political spaces as though it was just the way the world was made.

The individual

Notwithstanding these remarks it would be absurd to insist that it makes no difference who won the presidency. Though I have said that both candidates will have to perform on the same stage with the same scenery, it is not to say that they will dance the same tango or croon indistinguishable arias. I have some thoughts about how Obama’s second term will differ from the first and I would like to share them with readers.

The one lesson that Obama has to learn is that he needs to be a lot more assertive and since he no longer needs to be concerned about re-election the way is open for more political risk taking. It remains to be seen how much bolder Obama will be in his second term. Will the timidity of the first term be a stern nurse?

Unfortunately I need to straight away pour cold water. The Democrats retained a slim majority in the Senate but in the House of Representatives the Republicans retained their stranglehold majority. There is little a president can do on fiscal matters without a Congressional compromise. The motto of the previous Republican majority was “we will oppose anything that Obama proposes”. Will it be any different in the next four years? That will depend on a much more resolute and vocal intervention of the public. That Obama held on to 51% of the popular vote despite the grimmest economic crisis since the Great Depression and the most repulsive campaign attacks, is proof that half of America understands that this crisis is systemic and beyond the capacity of anyone to mend with the wave of a magic wand. If people are beginning to see that something is quite deeply wrong with the system itself, that’s a big step forward.

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    The “second office” in the government is “honorable and easy”;

    the first is but a “splendid misery” and

    no man will ever carry out of the

    Presidency the reputation which carried him into it.-Thomas Jefferson

    Fortunately he can walk on his own shadow ;)

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