Two Paths from Fear: Punish or Build

The narrative choices faced by the Obama Administration in confronting the Great Recession were nicely outlined yesterday in the editorial pages of the New York Times. Columnist Frank Rich offered a blistering critique of the Administration for ceding populist outrage to the right by failing to go after Wall Street executives responsible for the financial crash with investigations and stiff punishments, going so far as to say that "the Obama administration seems not to have a prosecutorial gene" (read his column). Having chosen to focus on the future rather than the past, Obama has left the Tea Party to reap the passions of an outraged American public.

Rich's editorial colleague Tom Friedman voices a different kind of disappointment. Obama's focus on the future, and his talk of investing in rebuilding America, has turned out to be just talk. The billions spent on stimulus turned out to include only tinkering on the edges of a massive need for reinvestment.

In the past two weeks, I’ve taken the Amtrak Acela to the Philadelphia and New York stations. In both places there were signs on the train platforms boasting that new construction work there was being paid for by “the American Recovery and Reinvestment Act of 2009,” that is, the $787 billion stimulus. And what was that work? New “lighting” — so now you can see even better just how disgustingly decayed, undersized and outdated are the rail platforms and infrastructure in two of our biggest cities.

(read Friedman's column)

The critiques suggest an Obama Presidency caught in between its reluctance to embrace the old politics of governing through crime, and its inability to launch a new politics of infrastructure. After his health care defeat in 1994, Bill Clinton made himself into the Prosecutor-in-Chief, supporting harsh and punitive laws on crime, immigration, and welfare. Clinton was relected, but he accomplished little of importance for the nation. Since the 2008 campaign I have been impressed with Obama's commitment to avoiding a politics based on demonizing. He could have framed Wall Street leaders as felons and sought to build legitimacy by sending as many of them to prison as possible and he might be more popular now if he had. It may be that he was simply too cosy with Wall Street (which did send him a lot of campaign support in 2008) but I prefer to believe Obama rejects a politics that converts fear into anger by demonizing an enemy and than seeking to punish it. Everything about President Obama's style as a speaker and a leader, cuts against his effectiveness as a prosecutorial President. The bigger question is why Obama did not try to lead the kind of infrastructure rebuilding politics he promised during the campaign.

Ironically, both the politics of punishment and the politics of building draw on fear which is the essential source of energy in liberal governance. Think of the way FDR drew on fear of the Great Depression and fear of European fascism to create the New Deal and US involvement in the World War II. Obama has not lacked for similar threats against which to mobilize America. Both the financial crisis and last summer's Gulf oil spill provided powerful examples of the threat posed by decades of underinvestment in infrastructure and under-regulation of corporate greed. Without demonizing either Wall Street or oil companies, Obama could have used the Oval office to make a sustained campaign for rebuilding American infrastructure and regulatory capacity.

It is not too late for both. A stronger Republican hold on congress will make new legislation impossible, but it will frame a stark choice between a government that actively seeks to protect ordinary Americans and one that leaves them to their fates. The Republican effort to repeal the health care reform and the privatize social security will pose this choice starkly come January. Stay tuned...