Obama's Economic Diagnosis Must Go Deeper

Governance is a moral act. Since the Reagan years, the morals enshrined in our nation’s policies have been those values that characterize laissez-faire economics: individual responsibility, acquisitiveness, personal freedom, and less government intrusion in corporate decision-making processes. Yesterday President-elect Barack Obama outlined his stimulus package and it was heavy on a different set of values: societal solidarity, forceful government intervention in the economy, communal responsibility.

The two approaches reflect the two lobes of the American brain. Our national character is fiercely individualistic but it is also profoundly influenced by the ethical impulses of the Judeo-Christian tradition with its concern for human solidarity. I am my brother’s keeper, but I also want my brother to let me chart my own course. Neither political party completely ignores either set of values, but the essential divide in our political life corresponds to this division within the national psyche.


The President-elect’s speech on the economy contrasted thoroughly with Ronald Reagan’s assertion that "Government is not the solution; Government is the problem" or with Bill Clinton’s claim in 1995 that "the era of big government is over." Yesterday, Obama insisted that "at this particular moment, only government can provide the short-term boost necessary to lift us from a recession this deep and severe. Only government can break the cycle that are [sic] crippling our economy…"

But, there is a deeper moral aspect to the economic crisis and Obama’s speech only alluded to it and it has largely escaped notice although I think it explains why the nation turns to Democrats and government in times of economic difficulty. By using the power of government to intervene in the market, Obama is proving that we human beings are not at the mercy of the impersonal laws of the economy, that we are capable in part of determining our own fate. Claimed the economic crisis was "due to an era of profound irresponsibility that stretched from corporate boardrooms to the halls of power in Washington, D.C." but was it really only the excesses of capitalism that caused the problem?

"Now, the very fact that this crisis is largely of our own making means that it’s not beyond our ability to solve" Obama said, correctly hitting the right pitch about our human capacity to transcend the laws of the market. But he had just blamed the crisis on specifics, on the dangerous decisions of Wall Street executives, banks that made reckless loans and politicians who lacked wisdom and discipline in spending taxpayer money. All three actors justified their actions at the time because, in a competitive environment, if they did not face the danger, take the risk or give the electorate what it wanted, they would lose out to someone who would. It is difficult not to conclude that the origins of this crisis are systemic not epiphenomenal.

You can criticize a dog for barking but barking is what dogs do. You can prune a shrub for growing but growing is what shrubs do. Greed is not a cancer on capitalism, it is the engine of capitalism. Left unfettered, it will always bring us to a moment of socio-economic crisis. The fetters must come from government, the only societal actor with enough power to challenge the moneyed interests in a free society. It isn’t only that we need government to jump start the economy. We need government to be an expression of democratic will over and against the idol of free market ideology that claims we are powerless before the laws of the market.

Those who are committed to laissez-faire economics are reduced to silence when the economy turns truly bad. (Remember "The End of History" which suggested we had solved the riddle of human socio-political governance?) They worship the laws of the market and when those laws fail, their altar is bare. Obama has something to say. In the event – and how rare is this for a politician! – there is more to be said than what Obama said yesterday. The problems with the economy are not in the stars. But, the problems are not only in ourselves, or in that part of ourselves that gets greedy. The problem is the idea that economic laws should be allowed to determine our human story, and not the other way round. The idolatry of the market, not the excesses of the market, created the economic mess we are in and Obama should not be afraid to say so.

FDR grasped this difference and it was part of the reason he was such a master at governance. But, he had learned at Warm Springs about human will power. I do not know where Obama will learn the lesson, but he needs to if he is to grasp precisely the power of our democracy that is about to be placed in his hands.  


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10 years ago
I couldn't disagree with Michael Sean Winters more. He says, ''Greed...is the engine of capitalism.'' Well, if you call ''greed'' the desire of a parent to work hard and earn enough money to care for his or her family, the desire of a company to grow so that it can develop a product that improves human life and can employ other people who need to care for their families- if that is his meaning of ''greed,'' I guess we have to start thinking of ''greed'' as a good thing. I call ''greed'' an abhorrent and aberrant quality in humans which requires a response of serious consequences from the law. Why are people who want to work hard to support their families or grow their businesses and companies automatically termed ''greedy?'' It's the sociopathic behavior that is the problem, not the desire to be successful.
10 years ago
I think that Michael Sean Winter's short article is filled with brilliant insights. It is too bad however that these types of insights are not what this society wants to hear. I do want to say something on the issue of greed. I do not and I suspect that the author himself does not believe that the ordinary desire of small people to earn a better living to feed and nourish their families is ''greed.'' Neither necessarily is the business man's desire to turn a profit necessarily to be termed ''greed.'' What is greed is the inordinate desire for profit or gain at the cost of everything else. Thus the values of social equality, community, and justice are ignored. The kingdom of God is ignored or relativized to last place. That is what is think the author is talking about when he discusses the idolatry of the market place. And this idolatry is practiced by rich and poor alike in this society. Glenn King
10 years ago
I need to make another comment on Mr. Winters' article. Mr Winters states correctly that government being ''the only social actor which can challenge the moneyed interests in a free society'' is of course correct. However in stating this truth he is in fact pointing out another systematic injustice in this society. It is the devastating inequality of power between those who have economic wealth / power and thus governmental power and those that do not. It is because of this basic economic political inequality that government becomes the only actor which can bring even a minimal amount of justice to society. A truly just society would one in which the both the wealth and power would be more equally spread. In such a society government would not be the only actor maintaining justice in society.


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