Come this November President Obama and Democratic Party leaders will be calling their legislative achievements historic and unprecedented since New Deal days. In this regard they will call special attention to the health care reform law passed awhile back, and the financial reform that seems likely to be enacted in the next few weeks.
This isn’t a totally hollow boast. What these two measures actually represent, however, are not historical achievements that fundamentally altered a status quo, but modest improvements in systems that deperately needed really serious improvements at the expense of special interests.
There are some distinct parallels in the Obama-Democratic approach to health and financial reform challenges. In the health realm, before negotiations even began, Obama and Democrats in Congress abandoned the only thing that would have really worked to cover the 30 million Americans without health insurance while dramatically cutting costs — a single payer system of the kind used to fund health care in some other leading economies. With financial reform, the same sort of upfront abandonment was on view, this time discarding in advance reinstatement of Glass-Steagall, the legal separation of depository banks and securities trading entities, a law that had only been chucked aside in 1999.
Having given away real change without a fight, Obama and a Democratic Congress than proceeded to negotiate away the next best possibilities for health and financial reform. The former was creation of a government health insurer to keep private insurers honest via competition. This got axed from the final bill. With financial reform, a Senate-House conference committee is about to chuck the part of the reform measure that would keep banks that can claim federal bailouts from trading the derivatives that could generate such bailouts.
The claim you’ll hear from President Obama and Democrats in Congress in months to come will be that both the major reforms they brought about were the best ones possible given the power of special interests. Not so.
Inside Democratic Party circles there’s an astonishing inability (or unwillingness) to recognize the populist anger spreading throughout this country, the visceral rage against vested interests that so many Americans believe, quite rightly, are working against their own health and financial interests. In consequence, instead of tapping this populism to legislate a truly liberal agenda into law, Democratic leaders trim around the edges and watch helplessly as conservatives turn a potent populist wave to their own advantage.
Had the President and his party truly believed in the “change” they parroted during the last election season, there might have been some truly great, some truly historic legislation passed this year. As it is, the real change such timidity will likely produce is a very new congressional mix come this November.
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