Tuesday, January 20, 2009

Divergent Fiscal Philosophies

Bob Kuttner is concerned that Obama may buy into the conservative argument for 'gutting' Social Security and Medicare. This storyline has been pushed by Robert Rubin's Hamilton Project and the Concord Coalition for a while, and has received a recent boost by the newly formed Peter G. Peterson Foundation and the Peterson-Pew Commission on Budget Reform. Kuttner convincingly counters that this is essentially an ideological and not a fiscal debate.

Kuttner concludes:
So, just how will President Obama define fiscal responsibility, who will he choose to showcase, and to what end? It will be interesting to see whether his fiscal summit features people like Pete Peterson, David Walker, and Robert Rubin, and lends credence to their story--or whether he also gives the floor to their critics.

You can understand why, as matter of fiscal tactics, Obama would need to signal that it is possible and necessary to rely on large deficits in 2009 and 2010 to avert a recession, and then to get serious about fiscal discipline over the next decade once the economy has returned to decent growth. He needs to argue this to reassure the Blue Dogs in his own party, to win over some Republicans, and to get support of opinion leaders for his recovery strategy.

But there is more than one road to fiscal discipline. One entails gutting the few program that have survived the rightwing assault on social insurance. The other involves filling in the appalling gaps in social insurance and achieving fiscal balance by restoring the principle of taxation based on the ability to pay.

Once again, our new leader, who has inspired so much hope and who so wants to be a post-ideological president, needs to grasp that these are deeply ideological questions. To pretend otherwise is to allow the conservative version of the story to govern by default.

This is an excellent point, for these are fundamental strategic decisions about the future of this country, not just tactics. And questions of political strategy are always inescapably ideological,
because they are about what kind of world we are living in and about what kind of world we would like to live in.

You cannot not have an ideology in the sense of a worldview (Weltanschauung) and preferences. You can be 'post-ideological' as little as you can be 'post-partisan.' You might as well claim that you are 'post-political,' which would be even more nonsensical. Politics is precisely about positioning yourself, in term so how you see things and whether or not you would like to change them, and if so, how, and why this way and not that way? So how will Obama position himself, given how he has positioned himself? Where you stand very much depends upon where you sit.

The core insight of pragmatism is that since we cannot know for certain how the world 'really' is and could be, we should describe it in a way that furthers our values, interests, and preferences. Truth is what is better for us to believe in. Needless to say, it is obvious that the goals pursued by different types of progressives are irreconcilably divergent.

Of course, ideology is the most powerful when it is not perceived as such, but instead is passed off as 'common sense pragmatism', as it were, as simply a question of what works and what doesn't, without asking the primordial political question of who benefits and who loses? Is this what Obama is up to with all his rhetoric about pragmatism?

There is reason to be concerned, for Obama very deliberately placed all Rubinites in key economic positions: Summers, Geithner, and Orszag.

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