Populism

In itself, American populism is neither left nor right. Translated into economics, Jacksonian populism spells producerism. For generations, Jacksonian populists have believed that the hardworking majority of small producers is threatened from above and below by two classes of drones: unproductive capitalists and unproductive paupers. While government promotion of public goods like defense, infrastructure and utilities that benefit all citizens is acceptable, Jacksonomics is suspicious of crony capitalists who owe their fortunes to political connections (can you spell B-A-I-L-O-U-T?). And Jacksonian producerism naturally is haunted by the nightmare of a class of the idle poor, who are capable of working but instead live off the labors of others and lack an ownership stake in the community.

Reform movements have succeeded in the United States only when their programs resonated with populist and producerist values. Lincoln’s antislavery Republicans succeeded where the earlier Whigs had failed because the Republicans persuaded Jacksonian farmers that snobbish, parasitic Southern Democratic slave owners were a greater threat to white farmers and white workers in the Midwest than rich Republican bankers and industrialists in the Northeast. Lincoln’s Hamiltonian program of aid to railroads and national banking had to be sweetened with the offer of Western homesteads for yeoman farmers before former Jacksonian Democrats would join his coalition.

In the 20th century, the most popular and enduring legacies of the New Deal have been the programs compatible with small-d Jacksonian democracy — public spending on infrastructure like dams and electric grids and highways, the promotion of single-family home ownership, federal aid to education and Social Security and Medicare, two entitlements tied to individual work by means of the payroll tax. In contrast, welfare for the nonworking poor was always unpopular with most New Deal Democratic voters, who preferred public works programs like the WPA, CCC and CETA to relief payments for the poor and unemployed. Although he broke with the New Deal tradition in other ways, President Bill Clinton was true to its spirit when he collaborated with the Republicans in converting “welfare” from an unpopular federal entitlement to state-based workfare programs.

All too often in American politics the populist distinction between producers and parasites has been mapped onto the racial division between whites and nonwhites. But the Jacksonian republican concern about freeloaders is not, in itself, racist. And it has frequently manifested itself in anger at the freeloading rich as well as the freeloading poor. At the moment, populist anxieties about the nonworking poor or illegal immigrants receiving medical coverage are eclipsed by populist anger at federal bailouts for well-connected Wall Street bankers who pay themselves titanic bonuses for unproductive gambling with other people’s money.

Here, one might think, would be an opening for the center-left. And yet the Obama Democrats, unlike the Roosevelt Democrats, cannot take advantage of the popular backlash against Wall Street. Why?

One reason is that the attempt of the “New Democrats” like Clinton, Al Gore and Obama to win Wall Street campaign donations has been all too successful. As Clinton’s Treasury secretary, Robert Rubin helped complete the conversion of the Democrats from a party of unions and populists into a party of financial elites and college-educated professionals. Subsequently Obama raised more money from Wall Street than his Democratic primary rivals and John McCain. On becoming president, he turned over economic policymaking to Rubin’s protégé Larry Summers and others like Timothy Geithner from the Wall Street Democratic network.

The financial industry is now to the Obama Democrats what the AFL-CIO was to the Roosevelt-to-Johnson Democrats. It is touching to watch progressives lament that “their” president has the wrong advisors. “We trust the czar, we simply dislike his ministers.” Obama owed his meteoric rise from obscurity to the presidency not to any bold progressive ideas — he didn’t have any — but rather to a combination of his appealing life story with the big money that allowed him to abandon campaign finance limits. According to one Obama supporter I know, the Obama campaign pressured its Wall Street donors to make their contributions in the form of many small checks, in order to create the illusion that the campaign was more dependent on small contributors than it was in fact. Even now President Obama continues to raise money on Wall Street, while his administration says no to every progressive proposal for significant structural reform of the financial industry.

There remains the progressive wing of the Democratic Party, represented more in Congress than in Obama’s White House — and more in the House than in the Senate, a dully complacent millionaires’ club. Can congressional progressives compete with conservatives to channel popular outrage? Unfortunately, progressivism in the form in which it has evolved in the last generation does not resonate with populist producerism.

To begin with, most of the moral fervor of the contemporary center-left has been diverted from the issue of fair rewards for labor to the environmental movement. In theory, environmentalism ought to fit the populist narrative of defending shared goods against special interests. Indeed, clean air and water legislation and public parks and wilderness areas are broadly popular with working-class Americans, not least hunters and fishers. But many environmentalists insist that global warming must be combated not only by low-CO2 energy technology but also by radical lifestyle changes like switching from industrial farming to small-scale organic agriculture and moving from car-based suburbs and exurbs to deliberately “densified” cities with mass transit. Whether environmentalists propose to engineer this utopian social transformation by tax incentives or coercive laws, the campaign triggers the populist nightmare of arrogant social elites trying to dictate where and how ordinary people should live.

Even if it had not been eclipsed by moralistic lifestyle environmentalism, contemporary economic progressivism would be crippled by its own priorities. New Deal liberalism was primarily about jobs and wages, with benefits as an afterthought. Post-New Deal progressivism is primarily about benefits, with jobs and wages as an afterthought. This inversion of priorities is underlined by the agenda of the Democrats since the last election — universal healthcare coverage first, jobs later.

It is only in the post-New Deal era that universal healthcare has become the Holy Grail of the American center-left, rather than, say, full employment or a living wage. Sure, Democrats from Truman to Johnson sought universal healthcare, and Medicare for the elderly was a down payment for that goal. But the main concern of the New Dealers was providing economic growth with full employment, on the theory that if the economy is growing and workers have the bargaining power to obtain their fair share of the new wealth in the form of wages, you don’t need a vastly bigger welfare state. Having forgotten the New Deal’s emphasis on high-wage work, all too many of today’s progressives seem to have internalized the right’s caricature of FDR-to-LBJ liberalism as being primarily about redistribution from the rich to the poor.

This shift in emphasis is connected with the shift in the social base of the Democratic Party from the working class to an alliance of the wealthy, parts of the professional class and the poor. And progressive redistributionism also reflects the plutocratic social structure of the big cities that are now the Democratic base. Unlike the egalitarian farmer-labor liberalism that drew on the populist values of the small town and the immigrant neighborhood, metropolitan liberalism tends to define center-left politics not as self-help on the part of citizens but rather as charity for the disadvantaged carried out by affluent altruists. Tonight the fundraiser for endangered species; tomorrow the gala charity auction for poor children.

At a recent event in Washington, I was surprised when a Democratic senator said, “The major threat facing America today is the class divide.” The speaker was Jim Webb of Virginia, the self-conscious heir to Scots-Irish Jacksonian populism. He went on to attack the inhumane treatment of prisoners in American jails and the avoidance of military service by the American elite.

Populists like Webb are rare in today’s Democratic Party, while the Republicans, for all their folksy rhetoric, offer nothing but the economic program of their Wall Street Journal/Club for Growth wing. If mass unemployment and slow growth persist for years, some sort of third-party, “Middle American” populist movement in 2012 seems possible. (Lou Dobbs: tanned, rested and ready?)

Could a new wave of populist independents be steered into the Democratic Party? Alas, that seems unlikely, if Democrats are viewed as the compromised, establishmentarian governing party. Moreover, the Republican Party benefited from the last two populist upheavals. Richard Nixon built the generation-long hegemony of the Republicans on the anger of George Wallace voters, and, following the campaign of Ross Perot in 1992, Newt Gingrich captured anti-system reformism to build a Republican congressional majority for most of the period between 1994 and 2006.

In each case, liberals and progressives indiscriminately rejected the populist voters. The Wallace voters, most of whom were New Deal Democrats, were dismissed by most liberals as though they were motivated by nothing but opposition to racial integration. In 1992 the New Republic published an idiotic cover with Perot dressed as Mussolini, implying that he and his supporters were crypto-fascists. Today ridicule of the bombastic Sarah Palin shades all too easily into loathing for the lower middle class.

It would be much easier for the Republicans to rebuild the conservative-populist coalition that dominated American politics from 1968 to 2006 than it would be for the Democrats to rebuild the kind of liberal-populist coalition of the New Deal era from 1932 to 1968. Will the Democrats be marginalized a third time rather than empowered by anti-system populism? In the next few election cycles we may find out.

Between 1980 and 2008, inclusive, there have been eight presidential elections.  The Republicans have nominated five presidential candidates — Ronald Reagan, George Herbert Walker Bush, Bob Dole, George W. Bush and John McCain.  During the same time, the Democrats have nominated seven presidential candidates — Jimmy Carter, Walter Mondale, Michael Dukakis, Bill Clinton, Al Gore, John Kerry and Barack Obama.

The middle-class Republican candidates — Reagan and Dole — have been outnumbered by the candidates born into the social elite — the two Bushes and McCain.  George Herbert Walker Bush’s father, and George W.’s grandfather, Prescott Bush, was a wealthy Connecticut senator, whose own father, Samuel Prescott Bush, was a rich steel and railroad company executive.  John McCain’s father and grandfather were both four-star admirals.

Among Democratic presidential nominees in the same era, only Kerry — related to the wealthy Forbes, Winthrop and Dudley families of the Northeast — could claim anything like the pedigree of the Bushes.  If it takes three generations to make a gentleman, or even two, Al Gore doesn’t qualify as upper class.  His father, who preceded him as a senator from Tennessee, came from a modest background and received his law degree from the Nashville YMCA Night School of Law.  The other Democratic nominees in the 1980-2008 period came from middle-class backgrounds, like Barack Obama, the son of two college professors.  Bill Clinton was born into the lower middle class.

The plot thickens further, when Republican denunciations of government as tyranny are contrasted with the multi-generational commitment to public service on the part of Republican presidential candidates.  Samuel Prescott Bush, who served in the government during World War I, founded a dynasty that has produced a Connecticut senator, Prescott Bush; a Texas congressman and president, George Herbert Walker Bush; a Texas governor and president, George W. Bush; and a Florida governor, Jeb Bush.  John McCain, as we have seen, is the heir to a family tradition of military service.  Mitt Romney, the former governor of Massachusetts, is the son of George Romney, who was governor of Michigan.

So much for pork-rind populism.

The mystery deepens even further.  In the 19th century, the Republican Party was founded by Abraham Lincoln and others, devoted to the Henry Clay’s idea of the “self-made man.”  But in spite of conservative rhetoric about small business, today’s Republican economic orthodoxy does not promote the interests of entrepreneurs or industrial capitalism.  Instead, it promotes the economic interests of rentiers — families with inherited wealth and Wall Street investors — the kind of people who make money in their sleep, in the words of the 19th-century classical liberal economist J.S. Mill, who despised them.

The GOP crusade to abolish the estate tax — the “death tax” — does nothing for American business in general, even as it chiefly benefits the trust fund babies of a few super-rich families.  A lower tax rate for capital gains than for earned income means that the idle rich, and the hedge fund managers who manage their assets and are taxed at the capital gains rate, pay a much lower tax rate on their income than the majority of Americans who depend on wages or professional fees for a living.  Self-made entrepreneurs?  Hardly.

Nor does Republicanomics serve the interests of captains of industry.  If the Republican economic plan were drafted by CEOs of American-based companies that actually make things, rather than rearrange money, it would not necessarily please liberals but it would bear little resemblance to the rentier-friendly plans pushed by the Wall Street right.  The emphasis would be on a permanent R&D tax credit, lower corporate taxes, depreciation allowances, public infrastructure investment, policies to lower the costs of energy and other inputs, dollar devaluation and other policies to promote the inshoring of production in America.  Genuine captains of industry would not assign priority to estate tax relief and low capital gains taxes for the benefit of the trust fund set like the Bushes and Romneys.

The conclusion is inescapable.  The Republican Party is not really a pro-business party at all.  It is a pro-hereditary wealth party.  Its platform serves the interests of those few Americans who are born into wealth and seek to preserve their fortunes, not those who start new companies or invent new technologies.  Naturally, therefore, the party’s presidential candidates are chosen nowadays from among the pedigreed, hereditary social elite who are the chief beneficiaries of its policies.

How is it, then, that the party of old money has succeeded in winning the vote of the white working class since Nixon and Reagan?  To understand how this could occur, we need only look at American history.

In the 19th century the Jacksonian coalition, then identified with the Democrats beginning with Andrew Jackson, was, like the Republican Party today, based on an alliance of white Southerners and Southwesterners with working-class whites in the North.  Like today’s neo-Jacksonian Republicans, the original Jacksonians posed as the champions of the common man, denouncing government tyranny and privilege.

But Jacksonian common-man rhetoric was a camouflage for the interests of the most parasitic rentier elite in American history: the Southern slaveowners, including Andrew Jackson himself.  The rentiers of the plantation South were allied with Northern crony capitalists — businessmen and bankers who sought to loot the public domain by means of what today would be called “privatization.”  That is why the Jackson administration destroyed the Bank of the United States, a quasi-public agency that was the largest corporation in the country, and distributed its financial assets to “pet banks” allied with Jackson and his cronies.  The modern equivalent would be the privatization of Social Security and Medicare and the diversion of their vast revenues into private hands, which, of course, is the centerpiece of the Republican economic agenda for America.

Old or new, Jacksonianism has always combined the pretense of egalitarian rebellion against privilege with the reality of domination by upper-class rentiers and crony capitalists.  In the 21st century as in the 19th, the Jacksonian oligarchs divert the attention of their yeoman followers from what is going on by means of military jingoism (Jackson bellowed at France, today’s Republicans threaten Iran).  Central to the Jacksonian tradition is the exploitation of paranoid fears of federal tyranny, combined with dark undercurrents of racism (witness Ron Paul’s recent denunciation of the Civil Rights Act and the blacks-on-welfare trope cynically deployed by Gingrich and Santorum).

Can the Jacksonian trick of enlisting the white working class in the service of hereditary wealth and crony capitalism work again?  Why not?  It has worked before.

The changes that do take place are often the opposite of those that majorities of Americans want. Most Americans want Social Security to be strengthened and American manufacturing protected. But the conversation among elites inside the Beltway-New York bubble is about cutting Social Security and more one-sided “free trade” deals with mercantilist nations that, unlike the U.S., protect and promote their domestic industries.

Many Americans have come to the conclusion that nobody represents them in Washington anymore. They are right.

This situation is not the result of a sinister conspiracy by a single, unitary, all-powerful and diabolical elite. The origins of the disconnect are structural. The mass membership organizations that once represented ordinary Americans at the state and national level have been replaced by elite organizations that raise their money from a small number of billionaires rather than hundreds of thousands or millions of dues-paying members.

Compare the United States of 1950 with the United States of 2010. In 1950, many regular Americans belonged to the political parties, which were still federations of city, county and state parties. A third of the private sector workforce belonged to private sector unions, which were also organized as federations.

Mass membership organizations were important in the nonprofit sector as well. Local chapters of organizations like the United Way were part of state and national federations.

In the last half-century, as scholars like Robert Putnam have shown, these civic armies have more or less collapsed and have been replaced by small, elite organizations that specialize in raising money from a shrinking number of Americans who monopolize a growing share of the gains from national economic growth. This is as true on the political left as on the political right.

The national parties have long since ceased to be healthy mass membership federations. The national and state parties have been reduced to shells. Most Democratic and Republican politicians are independent entrepreneurs, raising as much money as they can on their own. Like the bank robber Willie Sutton, they go to where the money is. It is more efficient to get a few big checks from billionaires and industry lobbies than lots of little donations.

The parties don’t even bother to recruit non-plutocratic members anymore. I have been contacted by the Democratic Party precisely once in my life. Twenty years ago I received an invitation to buy a seat at a fundraiser for $1,500. Clearly the invitation was a mistake, and I have never received any direct mail or phone calls from the Democratic Party again. I have never received any solicitations from the Republican Party, either. Clearly I don’t make enough money to be of interest to the two parties.

The unions, like the parties, were once mass membership organizations that transmitted the demands of ordinary Americans upward to national elites. No longer. Government and business working together since Reagan have crushed organized labor in the U.S. Fewer than 10 percent of private-sector workers belong to unions. Most union members are public-sector employees, who make easy targets for the faux populists of the right.

Mass membership charities, too, seem to have gone the way of the dinosaurs. Do any children still collect money for UNICEF on Halloween? The siphoning of more and more national wealth to ever fewer people makes that kind of approach anachronistic. Why bother with a March of Dimes-style campaign, when you could get the same amount from one check by Bill Gates or Warren Buffett?

The nonprofit advocacy sector is bigger than ever, but it is chiefly funded by rich individuals in a few coastal cities as well as large donor foundations. Progressives complain that the Tea Party movement is an “astroturf” movement — that is, a simulacrum of a genuine grass-roots movement. But practically all progressive environmental or social campaigns are astroturf movements, too. They may do work in Albuquerque or Oshkosh, but if their money is coming from New York or San Francisco or Los Angeles rather than from local membership dues, they are pure astroturf.

We should not idealize the mass membership movements of the past. The old party machines were notoriously corrupt. Unions were often racist and in league with organized crime. And local civic organizations were often snobbish and clique-ridden.

The point is that the existence of these mass membership organizations, along with dues-paying charitable organizations, served as transmission belts bringing demands and values up from ordinary people in local communities to politicians and policymakers at the state and local level. These institutions complemented elections and made electoral democracy work.

If you keep elections but get rid of mass membership organizations, then democracy breaks down, as it has in the U.S. Contemporary American politicians interact with ordinary Americans only at the polls. The politicians do not need the money of ordinary people, as it is easier to raise large sums from rich people and lobbies. And between elections, the advocacy groups of the left and right that meet with politicians and their staffs are usually funded by the rich and large foundations, rather than dues-paying members.

In this new institutional environment, it is only natural that more and more elected officials should pay attention to the rich few who pay for their campaigns and for the advocacy groups that present them with proposals and platforms. Campaigning for office becomes an exercise in telling ordinary voters of the left, right or center what they want to hear and then ignoring them until the next campaign.

Having lost the old mass membership organizations that once represented them in state and national politics, alienated Americans in recent years have found leaders among preachers and media demagogues. This explains why the influence of African-American preachers like Jesse Jackson and Al Sharpton and white evangelical preachers like Pat Robertson and Jerry Falwell rose in the 1980s and 1990s, even as religious belief in the U.S. population steadily declined. The churches were, and are, the last mass membership organizations in the U.S. And politicized local congregations have taken it upon themselves to get their members to the polls — a function once performed by local party machines who ensured that the party faithful would vote “early and often.”

The renaissance of the churches in politics, however, appears to be over, perhaps because regular church attendance is dropping, even among Americans who claim religious beliefs. The preachers are being replaced by media figures. The grandchildren of the Americans of 1950, who took their cues from local politicians or local union officials or civic leaders, now look for guidance to Glenn Beck or Jon Stewart. But the flash mobs that Beck and Stewart produced on the Mall in Washington are no substitute for member-based organizations. Politicians have no incentive to pay any attention to one-off media events that replace sustained campaigns.

If this analysis is correct, then the crisis of American politics is not a matter of finding this or that philosopher-king to run for office. In the present environment of organizational weakness and plutocratic power, it is not clear that leaders as great as Lincoln or Franklin Roosevelt would be able to get things done.

If America is to be rescued, the American people must be mobilized. But in today’s America, the money is mobilized and the people are not.

The different ethno-regional bases of the two parties explain their different attitudes toward populism and statism. The Republican Party’s combination of hostility to the federal government with the rhetoric of populism is a revival of the Jacksonian synthesis of the 1820s and 1830s. From the perspective of Jacksonian Democrats or neo-Jacksonian Republicans, anti-statist populism is a rational strategy.

The Jacksonian Democrats of the 19th century, like the neo-Jacksonian Republicans of the 21st century, have believed, not without reason, that wealthy, educated Northeastern elites will always dominate a powerful federal government and sacrifice the interests of the Northern white working class and white Southerners and Westerners. This fear on the part of Jacksonians, past and present, produces a combination of folksy populism with support for state and local governments, which are less likely to be captured by metropolitan elites who look down on Irish and Italian Catholics in the North and the Scots-Irish in the South.

The strategy of today’s Democratic base is equally rational, given its core constituencies. The post-’60s coalition of minorities that forms the Democratic base naturally favors a strong federal government to protect the civil rights of its members from the bigotry of local racial and religious majorities.

But the same logic that leads the Democratic base to favor a strong central government leads it to oppose the kind of nationalism and populism that, in other democracies, as well as in the United States of Abraham Lincoln and Franklin Roosevelt, have been invoked to justify strong, activist national government. Jews, blacks and Latinos, as well as other pro-Democratic minorities like gays and lesbians and secularists, fear that the populism of the white Christian majority, if unleashed, would quickly become xenophobic, intolerant and oppressive. Even an inclusive, non-racist, liberal “melting pot” nationalism is viewed as a threat by those members of minority groups who don’t want their groups to melt away because of intermarriage or assimilation.

This strategic logic explains the apparent paradox that many of the same progressives who call continually for strengthening the central government of the American nation-state also denounce populism and nationalism in America. The interests of the Democratic voter base, rather than philosophical consistency, explain why the same Democrats who favor universal, national social insurance policies also support non-universal civil rights policies like affirmative action and minority redistricting.

Ever since the present party system took shape three decades ago, there have been ephemeral movements that do not fit into the modern Republican pattern of anti-statist populism and the modern Democratic pattern of anti-populist statism. In different ways, Ross Perot and Lou Dobbs represented a third alternative — the combination of populism with a more statist approach to economics. The reward of these mavericks was to be denounced by Republicans for being too statist and to be viewed with suspicion by Democrats because of their populism.

Indeed, the two parties agree that any combination of populism and statism other than their own two patented variants is “fascism.” It is acceptable to be against big government and for big business, or to be against big business and for big government. But consistent populists who oppose both big business and big government are potential Hitlers, according to anti-populist statists on the left and anti-statist populists on the right.

The reactions of both parties to the Great Recession can be explained in part by the strategic calculations of their respective ethnic and regional constituencies. Consider the debate over infrastructure. Progressive Keynesians are quite right that massive public spending is necessary to compensate for reduced private consumption — and that investment in infrastructure would be among the best uses of otherwise idle funds. Most progressive Democrats insist on inter-city high-speed rail as the centerpiece of their infrastructure plans, even though costly, highly subsidized passenger rail would be at the bottom of any rational list of transportation priorities, compared to repairing and expanding the nation’s highways, bridges, freight rail network and inland waterways and modernizing the electric grid.

The chief beneficiaries of high-speed rail would be urban real estate interests, big city governments and the elite members of the disproportionately urban Democratic base who could afford the expensive tickets. There would be little or no benefit to the white working class in Northern suburbs or sprawling Sun Belt cities. It is small wonder, therefore, that today’s neo-Jacksonians reject high-speed rail as vehemently as the original Jacksonians rejected ambitious federal programs of “internal improvements” in the 1830s. Nor is it coincidence that Republicans prefer the present system of highway funding, dominated by members of Congress from small-population states in the hinterland, and tend to oppose the idea of an infrastructure bank that might be staffed by members of the Atlantic seaboard elite.

Then there is the debate over healthcare. Because their base includes the black and Latino working poor, who are disproportionately likely to be uninsured, the Democrats naturally made universal coverage the basis of their approach to healthcare, rather than cost containment, which was a secondary consideration. However, most members of the white working class and middle class have coverage through their employers. Their main concern is with the rising costs of drugs, hospital stays and doctors’ visits. It was therefore relatively easy for conservative Republican strategists to portray Democratic healthcare reform as a plot to raise taxes and cut healthcare spending for white working-class and middle-class Americans in order to subsidize poor black and brown outsiders, including illegal immigrants.

In this year’s midterm elections, Democrats who favor greater federal government activism but are wary of invoking what they view as a potentially dangerous and xenophobic populism are going to lose congressional seats and possibly one or both houses of Congress to Republicans who, in true Jacksonian fashion, combine unapologetic populism with hostility to a federal government that they view as being dominated by racial, regional and religious outsiders. At some point the present party system will give way to another pattern. But in the near future, conservatives who celebrate the people and oppose the central state will be found in one party, and progressives who favor the federal government but fear the dark side of populism will be found in the other.