“Obama has ruined the Democratic Party”

Matt Stoller, writing in Salon, looks to history for examples of losses comparable to those the Democratic Party suffered in its 2010 “wipeout.” He says that the absence of a serious discussion of how to replace Obama on the 2012 ticket shows how weak the Democratic Party has become.

Obama has ruined the Democratic Party. The 2010 wipeout was an electoral catastrophe so bad you’d have to go back to 1894 to find comparable losses. From 2008 to 2010, according to Gallup, the fastest growing demographic party label was former Democrat. Obama took over the party in 2008 with 36 percent of Americans considering themselves Democrats. Within just two years, that number had dropped to 31 percent, which tied a 22-year low.

Of course, there are many rationalizations for Obama to remain the nominee. He’s faced difficult opposition. He’s passed major legislation. His presidency is historic. The economy is hard to resuscitate. But all such rationalizations evade the party’s responsibilities to actually choose the nominee best suited to win votes. If Obama looks unlikely to get enough votes to win, he should not get the nomination.

If would be one thing if Obama were failing because he was too close to party orthodoxy. Yet his failures have come precisely because Obama has not listened to Democratic Party voters. He continued idiotic wars, bailed out banks, ignored luminaries like Paul Krugman, and generally did whatever he could to repudiate the New Deal. The Democratic Party should be the party of pay raises and homes, but under Obama it has become the party of pay cuts and foreclosures. Getting rid of Obama as the head of the party is the first step in reverting to form.

Stoller then goes on to explain how money has come to dominate the nominating process since the primary was first implemented in the Democratic Party over forty years ago “as a response to party insiders having too much influence.” Consequently, it is now impossible to consider mounting a primary challenge without the support of some brave party insiders. But, he says, there is a precedent in history for such a challenge:

So what can party leaders do? History offers one model. In 1892, the Democratic Party nominated Grover Cleveland, and with sweeping majorities in both houses, Democrats had control of the federal government for the first time since before the Civil War. Then a financial crisis, plus Cleveland’s stubborn allegiance to banking interests, turned his presidency into a catastrophe for Democrats.

When taking state candidates into account, the 1894 midterm elections were comparable to the 2010 wipeout; Cleveland was disliked so ardently that party leaders pushed him out of running for reelection. Instead the Democrats nominated William Jennings Bryan, who introduced many populist themes into the party and began the ideological transformation that would culminate with the election of Franklin Roosevelt in 1932.

If Stoller is right, and 1896 is a model for our current predicament, then this fact should also serve to remind us what a deep hole progressives are in, and what a long process it might be (decades?) to dig ourselves out. Maybe that’s the timescale on which we should base our planning and our expectations.

This is all rather grim.

In the meantime, Obama seems to be out ahead of the Republicans in his attack on such founding principles of the Democratic Party as Social Security and Medicare.

Consider Obama’s push to raise the Medicare eligibility age (which we may hear more about from him in his speech next week). Obama is obviously listening to health care industry officials. So, how does raising the Medicare eligibility age increase industry profits?

Matt Yglesias explains:

The reasons are somewhat complicated, but also profoundly simple. The health care industry charges one price to Medicare, a different higher price to insurance companies, and a third much-higher price to individuals. The smaller your purchasing pool, the higher the price that industry can charge. Consequently, shifting marginal people out of Medicare is lucrative for the health care industry. By the exact same token, if you’re interested in reducing health care costs, what you want to do is listen to executives of health care companies and then go do the reverse. Rather than raising the Medicare eligibility age, we ought to be lowering it. That would require new tax revenue, but the amount of new taxes it would cost would be lower than the reduction in private health care spending. Alternatively, and semi-equivalently, we could embrace a Medicare “buy-in” or add a public option with Medicare-linked payment rates to the coming health care exchange. Both domestically and internationally, it’s clearly the case that the way to reduce health care costs is to adopt more statist payment systems. UK health care is cheaper than Canadian health care is cheaper than American health care. In America, Medicare is cheaper than private insurance.

So, raising the Medicare eligibility age will not lower health care costs. It will actually increase these costs, but remove them from the federal government’s balance sheet and onto the budgets (and backs) of old people.

This will really hit us in the pocketbook.

With Democrats like Obama, Republicans have become completely superfluous.

Maybe that’s what President Obama is counting on us to believe.

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