Ev Ehrlich's Everyday Economics

The Future Lies Ahead

There’s a thin – and sometimes imaginary – line between giving your view – a view based on a lifetime of evolving judgment, thoughtful reflection, and sober experience – and being a big-mouthed Herkimer who does his Steve Allen reads the Daily News impression and today I’m going to straddle it.

There are opinions I don’t share(the Second Amendment gives you the right to own an assault weapon, the corporate and personal income tax should be separate systems), and then there are matters about which I generally don’t want to hear opinions.  And one of the latter is “what the President ought to say.”  I cringe when I hear somebody start a conversation  out that way – “You know, the President ought to get up and say…”, or even worse, “Why doesn’t the President just say…?”, usually followed by something about how the Congressional Republicans ought to be hanged like horse thieves (if I can say that without violating the New Civility).  A bus buddy of mine, whom I won’t identify by name insofar as I have, by implication, just disparaged him, is a master at this craft –he’s been architecting the President’s message from Day One from behind his newspaper in the mornings.

My tolerance for this kind of armchair messaging is low because people have the same misunderstanding about being President that they do, for example, about being a baseball player.  It just lookstoo easy – ballplayers seem to hang around a lot (often chewing stuff) and fail to get on base two out of three times.  Same thing with being President – you just stand there and say stuff, isn’t that it?  The idea that speaking is the 10 percent of the iceberg of being President that you can see, or that the President is obliged to speak in a very precise, disciplined way – as opposed to saying things that are satisfying to say – doesn’t seem to enter into this kind of advice.  Nor does the idea that what you’re saying has to resonate with an intricate plan for how to lead the country, how to control the terms of the political debate, and the priorities for action you have at the moment.  So much of the “President should say this” we get has elements of how he should accuse his opponents of being liars, dolts, doodyheads, or something similar, but worse.

Today, I prove myself no better.  Because next Tuesday is the first day of the rest of the President’s life, his State of the Union address, and like Bill Clinton, who declared that “the era of big government is over”  in 1995, President Obama gets one clean shot at reframing the post-shellacking debate. 

So, however irksome the question, it’s time to start thinking about what he ought to say next week.  To frame the question, let’s review.  The President’s programs have had one big success – they averted an economic disaster akin to the Depression.  Aside from some peripheral carping from both the far left and right, that’s more or less accepted.  He’s done some other things, as well.  One is a reregulation of the health insurance industry (mischaracterized as health care reform) that has some costs and benefits but that is neither the “job killer” its enemies claim nor the “big fucking deal” for which the Vice-President congratulated the President – if it was really that big a deal, then why is health care still linked to your job, and why do we still have a health care system that takes up twice the share of GDP that other countries spend to get the same result, and a ticking Medicare/Medicaid fiscal time bomb?  A second accomplishment of some note would be Dodd-Frank, which is to commended for taking a balanced approach to regulating capital markets (largely by incorporating the “Volcker Rule”), even if the law relies on the future effort of regulators to decide on the particulars.  I don’t want to sound dismissive, particularly given the agony of getting that much done, but that’s where we’re at.

But the ground has now shifted, and in ways other than the mid-term election.  The bill for avoiding an economic disaster is now coming due.  Granted, the entirety, or even the majority, of the fiscal mess isn’t of Obama’s making – The 2001 tax cuts – a response to a “long-term surplus” that proved a falsehood as damaging as “weapons of mass destruction” – and the Iraq War get some credit, but if we’re going to lay out who’s responsible for the fiscal deficit, we’re going to find more culprits than the final scene in Murder on the Oriental Express – (spoiler alert!) everyone did it.  Imposing austerity is not an attractive backdrop for a Presidency, but there’s no avoiding it – if the President fails to square up to the problem, he cedes the center to his opponents.  The question facing him, and his opponents, is this: what principles or rules will guide us through the retrenchment that we all know is coming?  His opponents have an answer: Leviathan Government that threatens our liberty, and so on.   Their answer – slay the beast.   It’s catchy and you can dance to it.

This is the President’s challenge, and opportunity.  Politics is about the future, and specifically, why the future is going to be better.  If you can’t explain why the future is going to be better, then find another line of work.   The vivid example of this was the 1996 election – President Clinton talked about a “bridge to the 21^st century” (for the life of me, I still have no idea what the hell that meant, it’s almost felonious metaphor abuse) while Bob Dole talked about how he remembered a better time in the past.  It was over before it began.  Even when Don’t Tread On Me types express their reverence for a distant, idealized national origin story, they’re talking about where they want to go.  For better and worse, Americans aren’t that interested in what just happened – they elected Obama because (in my view) they were sick to death of his predecessor or anything that reminded them of him.  But once Obama became President, they were uninterested in hearing about his predecessor.

The President’s good fortune is that, to date, he was embodiedthe future more than articulated a view of it.  He often speaks, I am told, about being a “transformative” President, but I can’t imagine that any President wants to be anything else.  But reading the President’s books, listening to him, watching him these past two years, the transformation he seeks seems to be about behavior and attitude – it comes from the meticulousness with which he’s conducted himself all his life and it’s about how we all need to be more thoughtful, considerate, and reasonable.  He was Civil before it was cool.

So on the question of “what does the future look like?,” the President has kept his powder dry.  That’s the great opportunity the State of the Union provides – we have a chance to hear the President’s view of the future in terms other than the usual, bipartisan platitudes about how great our country and its people are.  And we have a chance to hear it in the context of hard choices about retrenchment.

It won’t be about taxes – the President has already won on that score.  His compromise with Congressional Republicans, to my thinking, was the sharpest moment in his tenure.  It made a variety of good changes – keeping the estate tax on life support, a two-year partial respite on regressive Social Security taxes – and while it preserved the top rates of the Bush cuts, it kicked the issue of “should the rich pay more?” squarely into the 2012 election cycle.  I’m not saying the public will rise from their seats and speak as one to tax the rich (and, their subset, the dead rich), but if the President can’t win that argument in a national election, he should (and will!) go home and write more books.

Instead, the vision has to go to what kinds of spending should we cut and what should we protect.  And here is the opportunity to grab the future with both hands and hold on to it for dear life.  The message is we have to favor the future over the present.

Cuts to Social Security, and restructurings of Medicare, along with cuts in a variety of other programs – some highway cost-sharing grants, commodity support programs, defense (perhaps following Secretary Gates’ recommendations) -- are long overdue.  But the baby that will go out with the bathwater is spending that constitutes rational investment in the future.  It includes an improved approach to building infrastructure, support for research and development (particularly in areas with social contexts, such as environmental preservation or health), (again, carefully devised) education and training incentives, expansion of the broadband Internet across the “digital divide,” and other programs.  It’s an argument that the President needs to make not just to guide the retrenchment process, but to get past the “all spending by the Leviathan is evil” view that will hold the center ground until he explains to the contrary. 

There’s an element of wishful thinking in this.  I doubt there’s an economist drawing breath today who would disagree with the premise that (leaving aside some definitional issues) we should favor investment over consumption in the federal budget.  But the idea that we should favor the future over the present has currency that it never did before: as a cornerstone of the President’s identity; as a rule for thinking about retrenchment; and as a defense against the blanket anti-statist view of the President’s opponents.  There’s a reason why the classic parody of a platitudinous speech starts with the future lies ahead.  That’s because it does.  The President will explain to us next week how it’s all going to work.