beckyromero · 36-40, FVIP
A few points.
Reagan was elected with Republicans taking over control of the U.S. Senate (and held it for six of his eights years). And there was still a good enough number of conservative Democrats in the House that went along with parts of Reagan's economic policies.
Bush 41, however, had to deal with Democrat majories in both the Senate and the House. And the economic downturn in 1992, and the challenge from Pat Buchanan, evaporated his 91% approval rating at the end of the Gulf War.
Then enter H. Ross Perot.
Others will disagree, but I am convinced that had Perot not entered the presidential race, Bush would have won re-election. Yes, I know of the exit poll questions supposedly being split on the Bush or Clinton choice among Perot voters. ( see, for example: https://split-ticket.org/2023/04/01/examining-ross-perots-impact-on-the-1992-presidential-election/ )
But what those exit polls don't tell you is that with Perot forcused almost all his energy on attacking Bush; all the negative attention was on President Bush. Had Perot not ran, Clinton would have faced far more scruntiny. Many of those Perot voters were influenced by all the attacks on Bush. Would a slim majority of them still have favored Clinton had Perot not ran? I do not believe so.
As to when the radicalization of American politics, when the growing divergence began to occur, I would point to 1994.
That's when the Republicans gained control of the House for the first time since Eisenhower's presidency. The grabbed the Senate, too, and defeated two of the most popular Democrat governors in two of the nation's biggest states: New York's Mario Cuomo and Texas' Anne Richards. Speaker Tom Foley (D-WA) lost his re-election bid for his House seat. And Newt Gingrich would be the new Speaker of the House.
Furthermore, as we've seen since 2016, it was a different type of Republican that was being elected. Radical is certaintly the word. But the Democrats share much of the blame for their own losses. They didn't take the possibility if losing the House seriously. The failed to realized that Clinton's victory in 1992 was not a mandate. And Clinton himself failed to take advantage of passing popular legislation while the Dems controlled Congress (just like Obama, 2009-2011). And failed to nominate someone who could have helped reshape the Supreme Court: Mario Cuomo. Democrats in the state legislatures, either thru elected officials or voter-approved initiatives keep cutting their own throats with term limit laws and handing over redistricting to "citizen commissions" whereas Republicans in Red States continued to play hard ball.
Then Democrats lost about 1,000 Congressional, state legislative seats and governorships from 2008 until Obama left office in 2016. And who did they lose them to? Republicans who were generally more radical than those elected in 1994.
Democrats have a leadership problem in Congress, especially in the Senate. That is evident by the W-L record. But the seeds leadings to many of those losses were planted in the state legislatures. Democrats should have gerrymandered House seats in California and New York like Republicans have done in Florida and Texas. Instead, they chose unilateral disarament.
Reagan was elected with Republicans taking over control of the U.S. Senate (and held it for six of his eights years). And there was still a good enough number of conservative Democrats in the House that went along with parts of Reagan's economic policies.
Bush 41, however, had to deal with Democrat majories in both the Senate and the House. And the economic downturn in 1992, and the challenge from Pat Buchanan, evaporated his 91% approval rating at the end of the Gulf War.
Then enter H. Ross Perot.
Others will disagree, but I am convinced that had Perot not entered the presidential race, Bush would have won re-election. Yes, I know of the exit poll questions supposedly being split on the Bush or Clinton choice among Perot voters. ( see, for example: https://split-ticket.org/2023/04/01/examining-ross-perots-impact-on-the-1992-presidential-election/ )
But what those exit polls don't tell you is that with Perot forcused almost all his energy on attacking Bush; all the negative attention was on President Bush. Had Perot not ran, Clinton would have faced far more scruntiny. Many of those Perot voters were influenced by all the attacks on Bush. Would a slim majority of them still have favored Clinton had Perot not ran? I do not believe so.
As to when the radicalization of American politics, when the growing divergence began to occur, I would point to 1994.
That's when the Republicans gained control of the House for the first time since Eisenhower's presidency. The grabbed the Senate, too, and defeated two of the most popular Democrat governors in two of the nation's biggest states: New York's Mario Cuomo and Texas' Anne Richards. Speaker Tom Foley (D-WA) lost his re-election bid for his House seat. And Newt Gingrich would be the new Speaker of the House.
Furthermore, as we've seen since 2016, it was a different type of Republican that was being elected. Radical is certaintly the word. But the Democrats share much of the blame for their own losses. They didn't take the possibility if losing the House seriously. The failed to realized that Clinton's victory in 1992 was not a mandate. And Clinton himself failed to take advantage of passing popular legislation while the Dems controlled Congress (just like Obama, 2009-2011). And failed to nominate someone who could have helped reshape the Supreme Court: Mario Cuomo. Democrats in the state legislatures, either thru elected officials or voter-approved initiatives keep cutting their own throats with term limit laws and handing over redistricting to "citizen commissions" whereas Republicans in Red States continued to play hard ball.
Then Democrats lost about 1,000 Congressional, state legislative seats and governorships from 2008 until Obama left office in 2016. And who did they lose them to? Republicans who were generally more radical than those elected in 1994.
Democrats have a leadership problem in Congress, especially in the Senate. That is evident by the W-L record. But the seeds leadings to many of those losses were planted in the state legislatures. Democrats should have gerrymandered House seats in California and New York like Republicans have done in Florida and Texas. Instead, they chose unilateral disarament.
Burnley123 · 41-45, M
It's all interesting and well-researched.
Caveat: I'm British.
A few areas of disagreement.
I don't think that the 80s were a time of bipartisan consensus in America. It was on foreign policy (since the WW2). The Reagan revolution massively upended things and brought in the neoliberal era. On economics, the Democrats were divided into those who wanted to fight Reaganism and those who wanted to go along with it, with the latter winning out by the Clinton era.
The 90s were the time of least polarisation due to what I just mentioned and the end of the USSR as an existing alternative model. The time of greatest polarisation is now.
However, the polarisation is asymmetrical. The Democrats haven't moved that much in recent years. They have a radical social democratic wing but it's marginalised and they tied to the same consensus (economic and foreign policy) that both parties used to follow. They have become more liberal on social issues and Biden was a tepid step to the left but it certainly wasn't a radical change.
It's the Republicans who have radicalised and are upending the existing order.
For various reasons (some of which you mention) the far-right takeover is more advanced in America than in any other major country but you will know as well as I do that the nationalist right is rising across Europe and elsewhere.
Why?
There are lots of factors. The relative geopolitical decline of the West, internet conspiracy theories and the decline in organised labour. The slow collapse of trust in mainstream institutions and a revival in nationalist identities.
There is also the point that the neoliberal era once brought about rapid growth and increases in living standards but is no longer able to do so. Though there is still spirally wealth inequality which produces resentment. As someone who I suspect is a classical liberal, you might disagree on that point.
Caveat: I'm British.
A few areas of disagreement.
I don't think that the 80s were a time of bipartisan consensus in America. It was on foreign policy (since the WW2). The Reagan revolution massively upended things and brought in the neoliberal era. On economics, the Democrats were divided into those who wanted to fight Reaganism and those who wanted to go along with it, with the latter winning out by the Clinton era.
The 90s were the time of least polarisation due to what I just mentioned and the end of the USSR as an existing alternative model. The time of greatest polarisation is now.
However, the polarisation is asymmetrical. The Democrats haven't moved that much in recent years. They have a radical social democratic wing but it's marginalised and they tied to the same consensus (economic and foreign policy) that both parties used to follow. They have become more liberal on social issues and Biden was a tepid step to the left but it certainly wasn't a radical change.
It's the Republicans who have radicalised and are upending the existing order.
For various reasons (some of which you mention) the far-right takeover is more advanced in America than in any other major country but you will know as well as I do that the nationalist right is rising across Europe and elsewhere.
Why?
There are lots of factors. The relative geopolitical decline of the West, internet conspiracy theories and the decline in organised labour. The slow collapse of trust in mainstream institutions and a revival in nationalist identities.
There is also the point that the neoliberal era once brought about rapid growth and increases in living standards but is no longer able to do so. Though there is still spirally wealth inequality which produces resentment. As someone who I suspect is a classical liberal, you might disagree on that point.
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CedricH · M
Economic populism is currently used mostly as a dog whistle for a socialist in norm American politics
I actually didn’t know that, I used it more as a technical term and just to be candid here, Trump‘s an even bigger economic populist than Biden. It‘s this exact trend I‘m worried about. But my worries mustn’t concern you, after all I‘m the neoliberal who’s averse to populism. Also many of the points you made originally like BBB were things that never made it beyond talk so were not really a fair comparison to lump them with actual implemented policy.
Okay, so let me tell you why I mentioned BBB. Biden genuinely tried to get it through. I read every news piece on the legislative process back in 2021/22 and I just kept hoping that Senators Sinema and Manchin would kill it - and they did to some degree at least. However, my claim was about Biden and his policies (I didn’t make the claim that Sinema and Manchin are anti-neoliberal). An unsuccessful policy (pushing for a mega bill like BBB) is nevertheless a policy and it does express the programmatic views of an administration.
For instance, Reagan tried to cut spending more than he did. Congress blocked him. Bush 43 tried to liberalize the immigration system and reform Social Security. Both attempts failed on the Hill. But they can still be seen as hallmarks of their respective approaches to economic policy.
I am genuinely curious what you think Austrian and Chicago school economists have as a common denominator since they both renounce core tenets of the other
They both advocate for an assertive and comprehensive liberalization effort of any given political-economic system. Both schools of thought favor a less active state and more market-driven economic interactions between individuals. Neoliberal doctrine is thus tied to both schools of thought. Though more closely to the Chicago School because Ludwig von Mises (for instance) is more of a right-libertarian than a neoliberal. Another distinction that is important to me and factually accurate.
Most of the regulation in the US even under Biden is drastically less than other neo liberal governments in Canada and Europe and the west more broadly so that seems like making mountains out of molehills
Well, that‘s where you‘ve got to understand that I don’t see the Canadian government as a neoliberal government and neither are many European governments, for that matter.
This gets a little complicated now.
You can live in a free market economy or a social market economy but that doesn’t make the government itself neoliberal just because they‘re governing a market economy. That‘s not how I would approach the issue. On the other hand, a genuine neoliberal government can rule a socialist, centrally planned government, if it tried to transform the economy into a free market economy, even though that government would still govern a centrally planned economy for the time being.
Having said that, you‘re absolutely right, the US is more economically free than Canada or than most of Europe‘s economies - although that calculation would probably have to change if Trump‘s protectionism and economic nationalism were to continue on their current trajectory.
Most of it was also done under Obama too and was done for purely practical reasons and not anything ideological. After 2008 any government would be insane to permit a repeat of the sub prime mortgage fiasco for example.
The Dodd-Frank Act had its flaws and it will be partially repealed but you‘re right. From a regulatory point of view, Obama passed more regulations in total than Biden did. Believe it or not, but neoliberal doctrine actually supports moderate regulation for the purpose of financial stability. It‘s part of the Washington Consensus paper. However, Obama passed many other less essential regulations that did contradict the spirit of neoliberalism. And he wasn’t a neoliberal President either. He just didn’t opt for a hard break with key tenants of it. A bit like Gorden Brown or Kevin Rudd.
However, the quality of regulations is decisive too, Biden‘s regulations could’ve have stifled entire industries as they were maturing such as AI and crypto and they threatened to completely restructure private industries like the automobile and energy industries by government directive. No Obama regulation aimed at that kind of outcome.
You might have a point on taxes in an American context. But neo liberals more generally don't see tax breaks for the wealthy as a religion like the right wing of the neo liberal class in the US.
You‘re spot on! And I actually happen to support higher income taxes in the US coupled with spending cuts and entitlement reforms to balance the budget. However, neoliberals do support international tax competition which would’ve been undermined by the OECD BEPS process that Biden and Yellen supported. Another initiative that died in Congress. Moreover, he didn’t try to raise income taxes broadly to reduce spending, he tried to tax and spend and while exempting the middle income brackets and solely tax the wealthy. That‘s a departure from neoliberal doctrine. And so was the attempted hiking of corporate taxes (neoliberals support the gradual reduction of corporate taxes to phase it out because it is the most inefficient and harmful way to generate revenue and it is not even a progressive tax like an inheritance, a property or an income tax. The stock buy back tax also contrasts neoliberal policy recommendations because it created an entirely new tax category that has the potential to reduce and distort the market-driven allocation of capital in the financial system.
And as for government spending. The government has spent money on their country through all of history. That is what governments have always done.
And as for healthcare, childcare and education again you might have a point if we were talking about Europe or even Canada where such things are public services.
And as for healthcare, childcare and education again you might have a point if we were talking about Europe or even Canada where such things are public services.
You‘re mistaken on this point. Neoliberals do generally favor a reduction in public spending, balanced budgets and no excessive fiscal stimuli. Biden did the opposite on all counts.
Medicare and Medicaid are very much public in the US. And childcare support would be a de facto increase in welfare spending regardless of the recipients. Whether or not it is used to build and administer a state owned kindergarten or to help parents pay for a private pre-school. It‘s an increase in public welfare spending which neoliberals generally oppose.
One major change in the way Biden spent taxpayer funds was not just the immense size of the spending measures but the composition of it. Much went to industrial policies which are strongly opposed by any classical liberal or neoliberal. And Biden‘s industrial policy efforts were probably the most activist since FDR relative to the US GDP.
And sure. Biden may be a shift on unions but as I mentioned unions are a spent force in the US so it really is not a significant change.
Trying to revive union power is not insignificant and it was tied to an effort to reduce the elasticity and flexibility of the fairly liberalized US labor market. Moreover, the unions are unfortunately still very effective in influencing policy thanks to the current political realities. Their preferences and lobbying have largely precipitated the protectionist and economically nationalist shift we‘ve seen under Trump, Biden and Trump. Increased regulation is an inevitable result of the economic disasters of the last 20 years. No government on earth would just sit back and say "this is fine."
Now that’s your opinion. That’s not a fact. And as a matter of fact, even if someone increases financial regulation in response to the subprime crisis, then that’s not automatically a carte blanche to increase the level of regulations in every other area of the economy as well and abandon deregulation where it can still be beneficial. - which Obama and Biden both did. I can give you a list of countries where governments actually deregulated their economies even after the Great Financial Crisis, Ecuador (under Moreno and Lasso), Argentina (under Macri and Milei), Uruguay (under Lacalle Pou), Brazil (under Bolsonaro), Greece (under Mitsotakis), Mexico (under Peña Nieto), France (under Macron), Portugal (under Coelho), Italy (under Monti)
I hope we could find some areas of common understanding.
PicturesOfABetterTomorrow · 41-45, M
@CedricH I disagree only in the sense that Trump talks like a populist, but he doesn't care about anyone outside his own tax bracket. It is a big club but 99.9% of Americans are not in it.
And I get now why you mentioned BBB. In the original post it seemed like it was there just to pad your argument. I disagree with your views but I see your logic there at least.
As for Biden's position on Taxes that doesn't make him much different from Reagan. Reagan famously said he thought it was nuts that a billionaire paid more in taxes than a bus driver.
And Reagan is considered the father of neoliberalism in North America.
Reagan also famously had contempt for "Voodoo economics" which very accurately describes the Austrian school.
And as for crypto. Something that is 99% fraud is not an industry.
And we know from history tech such as AI has only ever really succeeded with massive initial advancements being made by almost exclusively public entities from Darpanet to public universities in California largely creating Silicon Valley.
And as for not considering Canada or various European governments not neo liberal. How is that not at "No True Scotsman" fallacy?
And I can tell you for sure unions in the US have had virtually no power in the US. You are talking about the same period that child labour and indentured servitude is making it's way back to the US. The US labour market looks more like it did in the rest of the world in 1890.
As for that list of governments that didn't push regulation after major crashes. Virtually all of them are completely disfunctional as a state including one run by an anarcho capitalist who dresses up in super hero costumes. Balsinaro was a fascist. Then again there are alot of neo liberal fascists.
And the EU already has banking regulations that prevent the sort of thing that happened in the states so of course they didn't add new regulation. You also mentioned some Europeans who like in Greece that came to power an entire decade after the 2008 crash.
The point I was making is all political ideologies are modified over time as they run into reality. Then again maybe you are an Austrian school fan where theory trumps objective reality. Poking fun here.
And I get now why you mentioned BBB. In the original post it seemed like it was there just to pad your argument. I disagree with your views but I see your logic there at least.
As for Biden's position on Taxes that doesn't make him much different from Reagan. Reagan famously said he thought it was nuts that a billionaire paid more in taxes than a bus driver.
And Reagan is considered the father of neoliberalism in North America.
Reagan also famously had contempt for "Voodoo economics" which very accurately describes the Austrian school.
And as for crypto. Something that is 99% fraud is not an industry.
And we know from history tech such as AI has only ever really succeeded with massive initial advancements being made by almost exclusively public entities from Darpanet to public universities in California largely creating Silicon Valley.
And as for not considering Canada or various European governments not neo liberal. How is that not at "No True Scotsman" fallacy?
And I can tell you for sure unions in the US have had virtually no power in the US. You are talking about the same period that child labour and indentured servitude is making it's way back to the US. The US labour market looks more like it did in the rest of the world in 1890.
As for that list of governments that didn't push regulation after major crashes. Virtually all of them are completely disfunctional as a state including one run by an anarcho capitalist who dresses up in super hero costumes. Balsinaro was a fascist. Then again there are alot of neo liberal fascists.
And the EU already has banking regulations that prevent the sort of thing that happened in the states so of course they didn't add new regulation. You also mentioned some Europeans who like in Greece that came to power an entire decade after the 2008 crash.
The point I was making is all political ideologies are modified over time as they run into reality. Then again maybe you are an Austrian school fan where theory trumps objective reality. Poking fun here.
CedricH · M
@PicturesOfABetterTomorrow I explicitly distanced myself from the Austrian School in my last post, maybe you overlooked that side note.
So that was the exact opposite of Biden‘s tax plan.
I‘m not a crypto expert and I‘m a bit skeptical myself but that statement seems like a hyperbole to make your point.
I‘m completely consistent here. Take Ireland. Ireland is by my standards a neoliberal country. And Fine Gael as well as Fianna Fáil (the two governing parties) are more or less neoliberal in their economic programs.
However, if Sinn Fein would govern Ireland, that wouldn’t magically and suddenly turn Sinn Féin (a left-wing party) into a neoliberal party.
So it really depends on the party or President whether a specific government can be classified as neoliberal.
I gotta say though, your bar for a party or person to qualify as neoliberal is probably lower than mine.
I fundamentally disagree with that statement and it happens to be completely unsubstantiated and uncorroborated . The union influence on foreign economic policy is undeniable. I specialize on trade policy and geo-economics and I can tell you without any hesitation that the unions are a serious problem for any committed free trader like myself.
You said no government on earth would deregulate anymore because of all the supposed market failures and I provided you with a list of western, developed and industrial countries - as well as some emerging economies - that actually did push for deregulation, post-2008.
And to call most of these countries completely dysfunctional is yet another, fairly disrespectful, distortion. By the way, in most of these cases, deregulation was and is the answer to the dysfunction that an overbearing government produced.
Trump talks like a populist, but he doesn't care about anyone outside his own tax bracket. It is a big club but 99.9% of Americans are not in it.
Agreed but he doesn’t just talk he also pursues explicitly populist policies, to the detriment of most Americans. As for Biden's position on Taxes that doesn't make him much different from Reagan.
Reagan‘s entire economic platform was based on significant reductions of income, capital gains and corporate tax levels. Reducing marginal tax rates in particular and considerably lowering the highest income tax bracket. So that was the exact opposite of Biden‘s tax plan.
Reagan also famously had contempt for "Voodoo economics"
You got that mixed up, George H. W. Bush criticized voodoo economics in his election campaign by which he was referring to the supposition that tax cuts will lead to more government revenue than was lost by the tax cuts. That’s mathematically and economically false but it was argued by some at the time and Bush (who raised taxes to reduce the fiscal deficit) countered their narrative. And as for crypto. Something that is 99% fraud is not an industry.
I‘m not a crypto expert and I‘m a bit skeptical myself but that statement seems like a hyperbole to make your point.
And we know from history tech such as AI has only ever really succeeded with massive initial advancements being made by almost exclusively public entities from Darpanet to public universities in California largely creating Silicon Valley.
Again a slight simplification and exaggeration, nevertheless, you‘re making a partially valid point. Public investments in education and basic R&D are certainly useful and have my full support. And as for not considering Canada or various European governments not neo liberal. How is that not at "No True Scotsman" fallacy?
I‘m completely consistent here. Take Ireland. Ireland is by my standards a neoliberal country. And Fine Gael as well as Fianna Fáil (the two governing parties) are more or less neoliberal in their economic programs.
However, if Sinn Fein would govern Ireland, that wouldn’t magically and suddenly turn Sinn Féin (a left-wing party) into a neoliberal party.
So it really depends on the party or President whether a specific government can be classified as neoliberal.
I gotta say though, your bar for a party or person to qualify as neoliberal is probably lower than mine.
And I can tell you for sure unions in the US have had virtually no power in the US. You are talking about the same period that child labour and indentured servitude is making it's way back to the US. The US labour market looks more like it did in the rest of the world in 1890.
I fundamentally disagree with that statement and it happens to be completely unsubstantiated and uncorroborated . The union influence on foreign economic policy is undeniable. I specialize on trade policy and geo-economics and I can tell you without any hesitation that the unions are a serious problem for any committed free trader like myself.
As for that list of governments that didn't push regulation after major crashes. Virtually all of them are completely disfunctional as a state including one run by an anarcho capitalist who dresses up in super hero costumes. Balsinaro was a fascist. Then again there are a lot of neo liberal fascists.
You said no government on earth would deregulate anymore because of all the supposed market failures and I provided you with a list of western, developed and industrial countries - as well as some emerging economies - that actually did push for deregulation, post-2008.
And to call most of these countries completely dysfunctional is yet another, fairly disrespectful, distortion. By the way, in most of these cases, deregulation was and is the answer to the dysfunction that an overbearing government produced.
AshleyMom4 · 41-45, F
What a great and thoughtful overview! Thanks.
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