November 25, 2006
BACK TO THE 70'S?:
The economic challenge facing Democrats (Robert Kuttner, November 25, 2006, Boston Globe)
Clearly the voters are sick of an economic system that allows moguls to make annual incomes running into the hundreds of millions, for manipulating commerce in ways that leave ordinary people worse off. In an election billed as a referendum on Iraq and Republican corruption (which it certainly was), the sleeper issue was the economy as it affects regular Americans.
But transforming this reality will require a lot more than a higher minimum wage or even universal health insurance. BusinessWeek is right: The current rules of globalism do weaken government's ability to use instruments that once allowed prosperity to be more widely shared -- tighter regulation of finance, a more progressive tax system with the proceeds invested in ordinary people, and a stronger labor movement.
As Rubin's role attests, the partisans of a globalized casino economy are almost as influential in the Democratic Party as the Republican Party. As Barney Frank takes a closer look at the abuses and risks of the new wave of speculation on Wall Street, he may find that the financial economy requires more regulation, not less, to deliver on the promise of an America with more broadly shared prosperity.
The problem for Democrats is that, post-Clinton, the GOP has co-opted the Third Way solutions that share wealth more equitably in a fashion that's consistent with a free market economy. HSA's, personal SS accounts, and the like asre the surest way to build wealth for even the poorest Americans, but Democrats are stuck reflexively opposing them. This is where Hillary could make her breakthrough--back to where Bill ended--if she has the stomach for it.
Posted by Orrin Judd at November 25, 2006 10:23 AM