Let's look again at the new populism through the lens provided by Robert Borosage in his recent attempt to tell us what it is about. He says:
The apostles of the new inequality have unrelenting sought to starve the public sector. President Reagan opened the offensive against domestic investments. Perhaps the hinge moment was in the final years of the Clinton administration when the budget went into surplus, and Clinton, the finest public educator of his time, pushed for paying down the national debt rather than making the case for public investment. He left the field open for George W. Bush to give the projected surpluses away in tax cuts skewed to the top end.
The hinge moment wasn't then. It was when he decided, either early in his first term, or even before he took office, to rely on deficit reduction coupled with low interest rates from Alan Greenspan, on the advice of Robert Rubin and Larry Summers, rather than on deficit spending on human capital investments as advocated by Robert Eisner and Robert Reich. Rubin's victory in the internal debates within the Administration was well-known at the time (1993), and set the deficit reduction course that played along with the Fed's bubbles to create the private sector debt-fueled “goldilocks” prosperity, and surpluses of his second term. By the time Clinton faced the choice Borosage refers to, the die had already been cast. It was very unlikely that Clinton would turn away from further Government austerity policy, and turn instead toward investments in infrastructure, public facilities and “human capital.”
But this is a side point, the real focus of this passage is the notion that the Clinton surpluses were good because they created an opportunity for public investment by using those surpluses. The trouble with this, is that it is a point purely about politics and communications which neglects the economic fact that the surpluses of the Clinton's term, as well as his deficit reduction policies, were bad for the US because they reduced or eliminated private sector surpluses causing a growth in private sector debt in Clinton's “goldilocks” economy. Read more about The New Populism Needs to Get This Straight
It's easy to recognize that after many years of trade deficits accompanying implementation of trade agreements beginning with NAFTA the US needs to change what it's doing. Many, including Robert Borosage of the Campaign for the American Future (CAF), advocate for balanced trade and they contrast that with the so-called “free trade” policies we have now. The case for balance trade policy is summarized by Borosage this way during his discussion of the policies favored by the New Populism:
Our global trade policies have been defined by and for multinational banks and companies. They have shipped good jobs abroad and driven wages down at home, while racking up unprecedented and unsustainable trade deficits. Those imbalances, as the International Monetary Fund and former Federal Reserve Chair Ben Bernanke have noted, contributed directly to blowing up the global economy.
The new populists demand balanced trade policies. . . .
So, we need “a balanced trade policy” meaning one that reduces trade deficits because it will support lower unemployment by keeping “good jobs” here, drive wages up rather than down, be more sustainable, and won't contribute to a collapse of the global economy. But, is that the only or the best way to get these outcomes? Read more about Who Needs a Balanced Trade Policy?
After reviewing the terrible state of our economy and the need to reconstruct it so that people can find work and a vibrant middle class can be rebuilt. Bob Borosage suggests that Congress go back to first principles. he briefly reviews the post- WWII history of employment legislation and says: Read more about Reality Check Plus
These last couple of days, I happened to see a couple of pieces by Robert Borosage. The first of these called “Kick the Old and Disabled to Show We're Serious About Deficits,” is about organizing and fighting back against the deficit terrorist movement to cut Social Security, and reported that Borosage's organization, the Campaign for America's Future, “has joined with 50 other organizations (and growing) representing 35 million Americans to form a coalition”, called “Strengthen Social Security.” He also refers to a panel on Social Security at Netroots Nation that will be “inviting the bloggers across the country to help fend off the assault on Social Security, and join the debate about priorities over the next years.” Then he ends with this: Read more about Past Time To Get Serious