For Dems, a bitter wake-up call is better than no wake-up call at all.

For many Democrats, the morning after Election Day last November was met less with excitement over the prospect of a new progressive era than the relief of knowing that the Trump presidency was going to come to an end. Joe Biden offered the prospect of building a political home for Democrats and independents, and a fair share of Republicans who could not stomach being part of the cult of Donald Trump and its stolen-election shibboleth. A few years of a quiet, calm presence in the White House, and a Congress that recognized the limitations that were inherent in a 50-50 Senate seemed within our grasp.

It didn’t seem like too much to ask for, but apparently it was. Before he left town last week for meetings in Europe with foreign leaders, Joe Biden announced the “framework” for a trimmed down $1.75 trillion spending plan. One might have hoped that he had the votes this time around. Of course, if he had the votes, he would not have announced a framework; he would have announced a deal. Instead, progressives sent him packing, declining to move forward with either of the two trillion-dollar-plus initiatives that were once touted as defining his presidency.

I never thought it was going to be easy. Last March, I shook my head in wonder as Alexandra Ocasio-Cortez made the talk show rounds, attacking her fellow Democrats for the timidity of their spending ambitions. Forget $3.5 trillion, or even $6 trillion, she argued. $10 trillion sounded about right to her. It was just a few years ago that a trillion dollars was a lot of money. No longer; apparently a trillion here and a trillion there no longer adds up to real money.

To be clear, my problem has never been the economics of the numbers Democrats have been throwing around. After all, these are ten-year numbers. $3.5 trillion is really $350 billion a year, and even $10 trillion simply suggests that the federal government might spend as much money each year supporting American families as we do on the military. As images of our unruly exit from Afghanistan suggested the waning of the American Century, and countries from the EU and Ukraine to Taiwan and Japan are questioning the reliability of U.S. security guarantees, it may be that the time has come to revisit the balance between the hundreds of billions of dollars we spend annually defending global alliances and energy supply lines, and domestic spending at home. Of course, that is not the debate we are having, though perhaps one of these days it will be.

It was never the Democrats' grasp of budget math that troubled me, but rather their facility with political math. Each time I heard Bernie Sanders proclaim that he had 80% of the Senate Democratic Caucus lined up behind his $6 trillion plan, I wondered what point he was trying to make. After all, 80% of 50 Senators is 40 votes, and 40 votes in the U.S. Senate is not even enough to sustain a filibuster, much less pass anything. All he was doing was telling the world that he didn’t have the votes to pass his plan, even as he was contributing to the perception among a fair share of Democrats, who believe that $6 trillion is an unfathomable sum of money, that Sanders and his allies have lost touch with reality. 

In the heady days before the November election, when visions of a 56-44 Senate majority danced in their heads, Democrat ambitions included ending the filibuster, packing the Supreme Court, restoring the Voting Rights Act, and funding a massive domestic program. After voters rendered their harsh verdict and gave Democrats just 6 wins among 14 competitive Senate races, Democrats – including Joe Biden, who of all people should have understood the implications of a 50-50 Senate – seemed determined to ignore the impact of the election on the viability of their spending plans. 

AOC spoke a simple truth early in 2020 when she observed that in any other country, she and Joe Biden would be in different political parties. But as appealing as a parliamentary system is beginning to look these days, progressives in Congress are stuck living within a system that gives them very little leverage over Senate centrists. Yet even as progressives have watched their spending dreams get whittled down from $10 trillion to $6 trillion to $3.5 trillion, and now to $1.75 trillion, House Progressive Caucus chair Pramila Jayapal continues to posture as though they are negotiating from strength. But other than sending Joe Biden off to Europe this week empty handed and sending Virginia voters to the polls on Tuesday increasingly concerned that Democrats in Congress are not up to the job, it is hard to understand what exactly Jayapal and her progressive colleagues imagine they are accomplishing beyond the steady deterioration of the credibility of the national Democratic Party. 

Progressives prefer to ignore polling data that suggests that much of the American electorate tends to be moderate and politically centrist. According to 2020 exit polls, the progressive left constituted just 11% of the electorate, while 16% identified as “very conservative” – a term that has apparently migrated from admiration for Edmund Burke and William F. Buckley to fanatical devotion to Donald Trump. The fact that 33% of voters placed themselves in the center in the exit poll, while fully 72% eschewed extreme labels on either side appear to be consistent with Gallup poll numbers on political affiliation among the electorate, which have suggested for years that while the Democratic Party has tended to hold a slight edge over Republicans, the largest share of the public – roughly 40-45% – identify as Independent. 

Progressives on the left and conservatives on the right – who tend to constitute the activists in each party – have long preferred to assume that unaligned voters, and in particular those who choose not to vote year after year, view the world as they do. For years, conservatives – back when that word had meaning – looked at the 45% or so of the electorate who don’t vote in presidential elections and imagined the lion’s share to be like-minded, small government folks, just waiting in the weeds for a Barry Goldwater or Pat Buchanan to run on faithful conservative principles, pledging to get government off their backs. Progressives have viewed the electorate in much the same way, except that for them, those who fail to show up on Election Day are the beleaguered masses yearning for a government that stands up for them and provides a sweeping support system to help them build a better life. 

This perspective is reflected in the conviction of Congressional progressives that their proposed massive infusion of new government programs will uplift American families and transform the politics of the nation – including bringing working class voters back into the Democrat fold. Those voters turned out for Obama’s promise of hope and change, progressives are quick to point out; he just failed to deliver the goods. Whether or not Bernie’s $6 trillion or AOC’s $10 trillion would transform the politics of the nation, however, is going to remain a theoretical proposition, as it was never going to happen in a 50-50 Senate – as Bernie Sanders’ own vote count attested. Joe Manchin – tiring no doubt of the tactics of Democratic activists who seemed to think that running ads attacking him in his home state would force him to accede to their demands – wryly suggested last month that if progressives want to achieve their goals, the essential first step is “to elect more liberals.”

The urgency of the moment that has consumed progressives – the conviction that everything must be done right now, regardless of the realities of a 50-50 Senate – appears to reflect a fear that 50-50 may be as good as it is going to get. “Demographics as destiny,” the view that has been widely embraced among Democrats that demographic trends are necessarily going to turn the nation blue  has given way to a fatalistic sense that Republicans hold structural advantages in the makeup of the Senate and Electoral College – rooted in the Apportionment Clause of the Constitution – that are going to be difficult to overcome. 

Ruy Teixeira, co-author of The Emerging Democratic Majority, the 2002 book that gave rise to the demographics-as-destiny thesis, suggested in a recent essay entitled “Demography is Not Destiny” that the real problem the Democratic Party faces is one of its own making. A Senior Fellow at the progressive Center for American Progress, he criticized the party for centering its politics around its growing share of highly educated voters, even as it has turned its back on white working class voters that remain essential to its political future. 

Barack Obama’s data guru David Shor has expressed a similar concern, though his focus was on the alienation of working class voters of all racial and ethic groups. “We’ve ended up in a situation where white liberals are more left wing than Black and Hispanic Democrats on pretty much every issue: taxes, health care, policing and even on racial issues or various measures of ‘racial resentment….So as white liberals increasingly define the party’s image and messaging, that’s going to turn off nonwhite conservative Democrats and push them against us.”

Teixeira, though, suggests that Shor’s prescription – “Do a lot of polling to figure out which of their views are popular and which are not popular, and then they should talk about the popular stuff and shut up about the unpopular stuff” – is naive, at best, as changing course would require that Democrats step back from “militant identity politics” that have become central to progressive politics. “This has resulted in branding the party as focused on, or at least distracted by, issues of little relevance to most voters’ lives. Worse, the focus has led many working-class voters to believe that, unless they subscribe to this emerging worldview and are willing to speak its language, they will be condemned as reactionary, intolerant, and racist by those who purport to represent their interests.” 

Tuesday’s election in Virginia looms to be a bitter wake-up call for Democrats. A recent Washington Post poll suggests that the race is a toss-up, despite Democrats having a 6-7 point edge in voter identification among the Virginia electorate. The difference appears to be the 18-point edge that Republican Glenn Youngkin has built over Democrat Terry McAuliffe among Independents, up from 8 points a month earlier. 

Should McAuliffe lose, many will be quick to point to Youngkin’s effective use of the latest GOP dog whistle surrounding the teaching of a Toni Morrison book in a Loudoun County classroom. Yet, in a race that has had significant national visibility from the outset, it will be hard not to point a finger of blame at the abject failure of Congressional Democrats to understand the constraints of the political hand they were dealt, and do their job with some degree of humility rather than hubris.

Even if McAuliffe squeaks by, the notion that Democrats are shedding support nationally among independents is a big, big problem. But even a bitter wake-up call will be better than none at all. Right now, both political parties are animated by activists in their ranks, while the largest share of the electorate is looking on in dismay. 

ORIGINALLY POSTED TO GRAFFITI BY DAVID PAUL ON SUNDAY, OCTOBER 31, 2021.

Follow David Paul on Twitter @dpaul. He is working on a book, with a working title of "FedExit! To Save Our Democracy, It’s Time to Let Alabama Be Alabama and Set California Free."

Artwork by Joe Dworetzky.  Follow him on Twitter @joedworetzky or Instagram at @joefaces. 

Debt ceiling hypocrisy.

That ritual of political hypocrisy is upon us: the time has come when Congress must raise the debt ceiling. 

There is little new in the political brinksmanship we have already seen, and it will reach a crescendo as the October 18th deadline looms. Time and again, we watch the same politicians who were only too willing to help amass trillions upon trillions of dollars of red ink, grandstanding as they point the finger at anyone but themselves when the debt ceiling vote rolls around. And each time, as we saw last week, the Secretary of the Treasury and Chairman of the Federal Reserve Bank dutifully march down to the Capitol, pound the table, and admonish members of Congress to put their partisan differences aside, and do as duty calls, lest financial calamity befall us all. Skyrocketing unemployment. An economy plunged into recession. Savings lost, lives destroyed.

Mitch McConnell is having none of it. A brilliant political tactician who may well go down in history as one of the prime movers in the destruction of the American Experiment, McConnell sees everything through the lens of political advantage. For this one brief moment, he appears to be luxuriating in being in the minority, as he can leave the debt ceiling problem in Chuck Shumer’s lap, even as he looks to squeeze some tactical advantage for Republicans when the Senate is once again up for grabs next year. 

McConnell has been down this path fourteen times over the past two decades and knows how this movie ends. He has declared he will have no part of the debt ceiling vote, and – unlike Democrat leaders Shumer and Pelosi – his members will follow him in lockstep. Not a single Republican Senator – not even Ohio’s Rob Portman or Missouri’s Roy Blount, erstwhile “moderates” on the eve of retirement, who one might have hoped would behave like grownups before they ride off into the sunset – has given any indication they will budge on the matter. Yet there is no risk of financial calamity, as he knows that when push comes to shove, Democrats will never allow a default on their watch.

No one should be surprised, of course. Republicans, who normalized massive deficits during the Reagan Revolution, reliably get on their high horses when the time comes to raise the debt limit whenever a Democrat sits in the oval office, and this time is no different. The debt ceiling is itself a contrivance in the purest sense, as when the time comes when the debt ceiling has to be raised, the acts of fiscal profligacy that necessitated raising it have long passed. If politicians, whether in Congress or the White House, oppose deficit spending and the issuance of debt that derives from it, they might consider introducing balanced budgets in the first place. But that would force them to actually do the heavy lifting of governing – balancing priorities of taxing and spending that Article 1 of the Constitution suggests they were elected to do.

Since Ronald Reagan changed the rules of the game, one GOP president after another has done their level best to push the public debt ever higher, even as they claimed to be fiscal conservatives. Indeed, the record shows – as much as Republicans bristle when confronted with the actual data – that the GOP has consistently outperformed Democrats when it comes to piling up the red ink. Reagan and George H.W. Bush gave new meaning to the word profligacy – in terms of the budgets they introduced, lest one try to shift the blame to Congressional Democrats during that era – while Donald Trump outdid them all, piling up a record $8 trillion in new debt in a single term in office. Fiscal conservatism, once the hallmark of Republicanism, has long been reduced to little more than a rhetorical device. Refusing to raise the debt ceiling after decades of pumping out red ink is not the hallmark of prudence, but rather performative theatre of the most cynical sort, a truncheon with which to bludgeon Democrats before the GOP faithful. 

Even as President Biden lashed out at Mitch McConnell this week for his debt ceiling gamesmanship, and refused to guarantee that the nation would not head over the fiscal cliff that looms just two weeks away, the markets evinced little concern that a default on U.S. debt and the ensuing financial calamity predicted by Treasury Secretary Janet Yellen constitute a material risk. Even after a 5% pull-back over the past month, the S&P 500 remains up 25% over the past year, while long-term bond markets have been similarly sanguine.  

Investors have many good reasons to be concerned about the state of the world; it is just that Congress’s ritual games of brinksmanship are nowhere near the top of the list. First and foremost, there is China to worry about. Forty years ago, China President Deng Xiaoping launched the transformation of the Chinese economy. It was an action that transformed the world, as it opened China up to world trade and led, in turn, to: China’s membership in the World Trade Organization; previously unimaginable declines in the percentage of the world population living in extreme poverty; the evisceration of the American middle class; political unrest and depression across the American heartland; and the rise of Donald Trump. China grew more prosperous. Much of America grew less prosperous. And in both countries income and wealth inequality exploded.

Over the past few months, China President Xi Jingping has changed course. Readers of the financial press know that he has implemented a dramatic crackdown on China’s largest corporations and wealthiest elites. He has moved the country away from its growth-at-all-cost policies toward the prioritization of “common prosperity.” Those changes, in turn, threaten to upend the rules of global trade and investment, and have contributed to stock market volatility over the past few months.

While some might imagine that the cascading evaporation of democracy in America before our eyes – The Economist magazine recently downgraded the United States from Full Democracy to Flawed Democracy in its Global Democracy Index – would have unsettled global markets, the real driver of volatility over the past month or two appears to have been the Xi Jingping’s determination to veer away from Deng's capitalist road and put a bit of Mao back in his step. 

And along with turmoil in the world’s second largest economy, there are plenty of other concerns for investors to focus on, before considering whether the debt ceiling is a real problem. There are continuing disruptions to global supply chains. Soaring global energy prices and supply shortages. There are fears of inflation and fears of deflation, and impacts on stock valuations. There are rising tensions in the South China Sea and the Straits of Taiwan and doubts about America’s commitments across the globe. Against that backdrop, Washington’s quasi-annual debt ceiling dance barely registers. 

Somehow, investors seem able to look past most anything these days. As long as global interest rates remain near their historic lows, everything else seems to be discounted as just more noise in the social media soap opera of everyday life. The GOP at war with democracy. The Democratic Party at war with itself. The Maoist Restoration in China. The pandemic of the unvaccinated. And the possibility of a US debt default. It is all just grist for the mill, and things just roll along.

Until they don’t. Over the past few decades, each time the debt ceiling had to be raised and the ritual game of brinksmanship started, a voice whispered in the back of my mind, “What if things are actually different this time? What if this time they really don’t get it done?” And each time, of course, that voice recedes when members of Congress, often with just hours to go, belly up to the bar and behave like grownups. The debt ceiling is raised. Default is averted. Financial calamity waits until the next time around. 

But what if things actually are different this time, and the unthinkable actually happens? Isn’t everything actually different this time around? Few imagined Donald Trump would get elected, but he did. Few could believe that a majority of Republicans in Congress would vote against the peaceful transfer of power, but they did. Have we really ever seen this degree of dysfunction? Things could be different this time, for the simple reason that things are different this time.

Perhaps, if Mitch McConnell stays the course, content that he has the strategic advantage, Democrats will call his bluff and decide not to play the grownups all by themselves, as he fully expects them to do. If the progressives and moderates in Congress are willing to go to the mattresses battling each other, perhaps this time, instead of doing as McConnell expects them to do, what he is counting on them to do, they will instead make common cause and call his bluff. 

Then, on or around the stroke of midnight on October 17th, announcing that Mitch McConnell has forced their hand, they will change the rules of the game. They can pass legislation not raising the debt ceiling, but instead confirming Janet Yellen’s ability, as Secretary of the Treasury, to mint five $1 trillion coins as the law allows. It is a tactic that has long been whispered about, and for which legislation is already on the books. It would change the rules of the game, and end the charade of the debt ceiling forever.

ORIGINALLY POSTED TO GRAFFITI BY DAVID PAUL ON SUNDAY, OCTOBER 4, 2021.

Follow David Paul on Twitter @dpaul. He is working on a book, with a working title of "FedExit! To Save Our Democracy, It’s Time to Let Alabama Be Alabama and Set California Free."

Artwork by Joe Dworetzky.  Follow him on Twitter @joedworetzky or Instagram at @joefaces.