When it comes to Barack Obama, I've always been out of
sync. Back in 2008, when many liberals were wildly
enthusiastic about his candidacy and his press was strongly
favorable, I was skeptical. I worried that he was naive, that
his talk about transcending the political divide was a
dangerous illusion given the unyielding extremism of the
modern American right. Furthermore, it seemed clear to me
that, far from being the transformational figure his
supporters imagined, he was rather conventional-minded:
Even before taking office, he showed signs of paying far too
much attention to what some of us would later take to calling
Very Serious People, people who regarded cutting budget
deficits and a willingness to slash Social Security as the very
essence of political virtue.
RELATED: Hope and Change Index: 6 Years of
Progress, By the Numbers
And I wasn't wrong. Obama was indeed naive: He faced
scorched-earth Republican opposition from Day One, and it
took him years to start dealing with that opposition
realistically. Furthermore, he came perilously close to doing
terrible things to the U.S. safety net in pursuit of a budget
Grand Bargain; we were saved from significant cuts to Social
Security and a rise in the Medicare age only by Republican
greed, the GOP's unwillingness to make even token
concessions.
But now the shoe is on the other foot: Obama faces trash talk
left, right and center – literally – and doesn't deserve it.
Despite bitter opposition, despite having come close to self-
inflicted disaster, Obama has emerged as one of the most
consequential and, yes, successful presidents in American
history. His health reform is imperfect but still a huge step
forward – and it's working better than anyone expected.
Financial reform fell far short of what should have happened,
but it's much more effective than you'd think. Economic
management has been half-crippled by Republican
obstruction, but has nonetheless been much better than in
other advanced countries. And environmental policy is
starting to look like it could be a major legacy.
I'll go through those achievements shortly. First, however,
let's take a moment to talk about the current wave of Obama-
bashing. All Obama-bashing can be divided into three types.
One, a constant of his time in office, is the onslaught from the
right, which has never stopped portraying him as an Islamic
atheist Marxist Kenyan. Nothing has changed on that front,
and nothing will.
Photo: Sean Gallup/Getty
There's a different story on the left, where you now find a
significant number of critics decrying Obama as, to quote
Cornel West, someone who ''posed as a progressive and
turned out to be counterfeit.'' They're outraged that Wall
Street hasn't been punished, that income inequality remains
so high, that ''neoliberal'' economic policies are still in place.
All of this seems to rest on the belief that if only Obama had
put his eloquence behind a radical economic agenda, he could
somehow have gotten that agenda past all the political
barriers that have con- strained even his much more modest
efforts. It's hard to take such claims seriously.
Finally, there's the constant belittling of Obama from
mainstream pundits and talking heads. Turn on cable news
(although I wouldn't advise it) and you'll hear endless talk
about a rudderless, stalled administration, maybe even about
a failed presidency. Such talk is often buttressed by polls
showing that Obama does, indeed, have an approval rating
that is very low by historical standards.
But this bashing is misguided even in its own terms – and in
any case, it's focused on the wrong thing.
Yes, Obama has a low approval rating compared with earlier
presidents. But there are a number of reasons to believe that
presidential approval doesn't mean the same thing that it
used to: There is much more party-sorting (in which
Republicans never, ever have a good word for a Democratic
president, and vice versa), the public is negative on
politicians in general, and so on. Obviously the midterm
election hasn't happened yet, but in a year when Republicans
have a huge structural advantage – Democrats are defending a
disproportionate number of Senate seats in deep-red states –
most analyses suggest that control of the Senate is in doubt,
with Democrats doing considerably better than they were
supposed to. This isn't what you'd expect to see if a failing
president were dragging his party down.
More important, however, polls – or even elections – are not
the measure of a president. High office shouldn't be about
putting points on the electoral scoreboard, it should be about
changing the country for the better. Has Obama done that? Do
his achievements look likely to endure? The answer to both
questions is yes.
HEALTH CARE
When Obama signed the Affordable Care Act, an excited Joe
Biden whispered audibly, ''This is a big fucking deal!'' He was
right.
RELATED: Obamacare: It's Working!
The enactment and implementation of the Affordable Care
Act, a.k.a. Obamacare, has been a perils-of-Pauline
experience. When an upset in the special election to replace
Ted Kennedy cost Democrats their 60-vote Senate majority,
health reform had to be rescued with fancy legislative
footwork. Then it survived a Supreme Court challenge only
thanks to a surprise display of conscience by John Roberts,
who nonetheless opened a loophole that has allowed
Republican-controlled states to deny coverage to millions of
Americans. Then technical difficulties with the
HealthCare.gov website seemed to threaten disaster. But
here we are, most of the way through the first full year of
reform's implementation, and it's working better than even
the optimists expected.
We won't have the full data on 2014 until next year's census
report, but multiple independent surveys show a sharp drop
in the number of Americans without health insurance,
probably around 10 million, a number certain to grow greatly
over the next two years as more people realize that the
program is available and penalties for failure to sign up
increase.
It's true that the Affordable Care Act will still leave millions of
people in America uninsured. For one thing, it was never
intended to cover undocumented immigrants, who are
counted in standard measures of the uninsured. Furthermore,
millions of low-income Americans will slip into the loophole
Roberts created: They were supposed to be covered by a
federally funded expansion of Medicaid, but some states are
blocking that expansion out of sheer spite. Finally, unlike
Social Security and Medicare, for which almost everyone is
automatically eligible, Obamacare requires beneficiaries to
prove their eligibility for Medicaid or choose and then pay for
a subsidized private plan. Inevitably, some people will fall
through the cracks.
Still, Obamacare means a huge improvement in the quality of
life for tens of millions of Americans – not just better care,
but greater financial security. And even those who were
already insured have gained both security and freedom,
because they now have a guarantee of coverage if they lose or
change jobs.
What about the costs? Here, too, the news is better than
anyone expected. In 2014, premiums on the insurance
policies offered through the Obamacare exchanges were well
below those originally projected by the Congressional Budget
Office, and the available data indicates a mix of modest
increases and actual reductions for 2015 – which is very good
in a sector where premiums normally increase five percent or
more each year. More broadly, overall health spending has
slowed substantially, with the cost-control features of the ACA
probably deserving some of the credit.
In other words, health reform is looking like a major policy
success story. It's a program that is coming in ahead of
schedule – and below budget – costing less, and doing more to
reduce overall health costs than even its supporters predicted.
Of course, this success story makes nonsense of right-wing
predictions of catastrophe. Beyond that, the good news on
health costs refutes conservative orthodoxy. It's a fixed idea
on the right, sometimes echoed by ''centrist'' commentators,
that the only way to limit health costs is to dismantle
guarantees of adequate care – for example, that the only way
to control Medicare costs is to replace Medicare as we know
it, a program that covers major medical expenditures, with
vouchers that may or may not be enough to buy adequate
insurance. But what we're actually seeing is what looks like
significant cost control via a laundry list of small changes to
how we pay for care, with the basic guarantee of adequate
coverage not only intact but widened to include Americans of
all ages.
It's worth pointing out that some criticisms of Obamacare
from the left are also looking foolish. Obamacare is a system
partly run through private insurance companies (although
expansion of Medicaid is also a very important piece). And
some on the left were outraged, arguing that the program
would do more to raise profits in the medical-industrial
complex than it would to protect American families.
You can still argue that single-payer would have covered more
people at lower cost – in fact, I would. But that option wasn't
on the table; only a system that appeased insurers and
reassured the public that not too much would change was
politically feasible. And it's working reasonably well:
Competition among insurers who can no longer deny
insurance to those who need it most is turning out to be
pretty effective. This isn't the health care system you would
have designed from scratch, or if you could ignore special-
interest politics, but it's doing the job.
And this big improvement in American society is almost
surely here to stay. The conservative health care nightmare –
the one that led Republicans to go all-out against Bill Clinton's
health plans in 1993 and Obamacare more recently – is that
once health care for everyone, or almost everyone, has been
put in place, it will be very hard to undo, because too many
voters would have a stake in the system. That's exactly what
is happening. Republicans are still going through the motions
of attacking Obamacare, but the passion is gone. They're even
offering mealymouthed assurances that people won't lose
their new benefits. By the time Obama leaves office, there will
be tens of millions of Americans who have benefited directly
from health reform – and that will make it almost impossible
to reverse. Health reform has made America a different,
better place.
Photo: Susan Walsh/AP
FINANCIAL REFORM
Let's be clear: The financial crisis should have been followed
by a drastic crackdown on Wall Street abuses, and it wasn't.
No important figures have gone to jail; bad banks and other
financial institutions, from Citigroup to Goldman, were bailed
out with few strings attached; and there has been nothing like
the wholesale restructuring and reining in of finance that
took place in the 1930s. Obama bears a considerable part of
the blame for this disappointing response. It was his Treasury
secretary and his attorney general who chose to treat finance
with kid gloves.
It's easy, however, to take this disappointment too far. You
often hear Dodd- Frank, the financial-reform bill that Obama
signed into law in 2010, dismissed as toothless and
meaningless. It isn't. It may not prevent the next financial
crisis, but there's a good chance that it will at least make
future crises less severe and easier to deal with.
Dodd-Frank is a complicated piece of legislation, but let me
single out three really important sections.
First, the law gives a special council the ability to designate
''systemically important financial institutions'' (SIFIs) – that
is, institutions that could create a crisis if they were to fail –
and place such institutions under extra scrutiny and
regulation of things like the amount of capital they are
required to maintain to cover possible losses. This provision
has been derided as ineffectual or worse – during the 2012
presidential campaign, Mitt Romney claimed that by
announcing that some firms were SIFIs, the government was
effectively guaranteeing that they would be bailed out, which
he called ''the biggest kiss that's been given to New York
banks I've ever seen.''
But it's easy to prove that this is nonsense: Just look at how
institutions behave when they're designated as SIFIs. Are they
pleased, because they're now guaranteed? Not a chance.
Instead, they're furious over the extra regulation, and in
some cases fight bitterly to avoid being placed on the list.
Right now, for example, MetLife is making an all-out effort to
be kept off the SIFI list; this effort demonstrates that we're
talking about real regulation here, and that financial interests
don't like it.
Another key provision in Dodd-Frank is ''orderly liquidation
authority,'' which gives the government the legal right to seize
complex financial institutions in a crisis. This is a bigger deal
than you might think. We have a well-established procedure
for seizing ordinary banks that get in trouble and putting
them into receivership; in fact, it happens all the time. But
what do you do when something like Citigroup is on the edge,
and its failure might have devastating consequences? Back in
2009, Joseph Stiglitz and yours truly, among others, wanted to
temporarily nationalize one or two major financial players,
for the same reasons the FDIC takes over failing banks, to
keep the institutions running but avoid bailing out
stockholders and management. We got a chance to make that
case directly to the president. But we lost the argument, and
one key reason was Treasury's claim that it lacked the
necessary legal authority. I still think it could have found a
way, but in any case that won't be an issue next time.
A third piece of Dodd-Frank is the Consumer Financial
Protection Bureau. That's Elizabeth Warren's brainchild, an
agency dedicated to protecting Americans against the
predatory lending that has pushed so many into financial
distress, and played an important role in the crisis. Warren's
idea was that such a stand-alone agency would more
effectively protect the public than agencies that were
supposed to protect consumers, but saw their main job as
propping up banks. And by all accounts the new agency is in
fact doing much more to crack down on predatory practices
than anything we used to see.
There's much more in the financial reform, including a
number of pieces we don't have enough information to
evaluate yet. But there's enough evidence even now to say
that there's a reason Wall Street – which used to give an
approximately equal share of money to both parties but now
overwhelmingly supports Republicans – tried so hard to kill
financial reform, and is still trying to emasculate Dodd-Frank.
This may not be the full overhaul of finance we should have
had, and it's not as major as health reform. But it's a lot
better than nothing.
THE ECONOMY
Barack Obama might not have been elected president without
the 2008 financial crisis; he certainly wouldn't have had the
House majority and the brief filibuster-proof Senate majority
that made health reform possible. So it's very disappointing
that six years into his presidency, the U.S. economy is still a
long way from being fully recovered.
Before we ask why, however, we should note that things could
have been worse. In fact, in other times and places they have
been worse. Make no mistake about it – the devastation
wrought by the financial crisis was terrible, with real income
falling 5.5 percent. But that's actually not as bad as the
''typical'' experience after financial crises: Even in advanced
countries, the median post-crisis decline in per- capita real
GDP is seven percent. Recovery has been slow: It took almost
six years for the United States to regain pre-crisis average
income. But that was actually a bit faster than the historical
average.
Or compare our performance with that of the European
Union. Unemployment in America rose to a horrifying 10
percent in 2009, but it has come down sharply in the past few
years. It's true that some of the apparent improvement
probably reflects discouraged workers dropping out, but there
has been substantial real progress. Meanwhile, Europe has
had barely any job recovery at all, and unemployment is still
in double digits. Compared with our counterparts across the
Atlantic, we haven't done too badly.
Did Obama's policies contribute to this less-awful
performance? Yes, without question. You'd never know it
listening to the talking heads, but there's overwhelming
consensus among economists that the Obama stimulus plan
helped mitigate the worst of the slump. For example, when a
panel of economic experts was asked whether the U.S.
unemployment rate was lower at the end of 2010 than it
would have been without the stimulus, 82 percent said yes,
only two percent said no.
Still, couldn't the U.S. economy have done a lot better? Of
course. The original stimulus should have been both bigger
and longer. And after Republicans won the House in 2010,
U.S. policy took a sharp turn in the wrong direction. Not only
did the stimulus fade out, but sequestration led to further
steep cuts in federal spending, exactly the wrong thing to do
in a still-depressed economy.
We can argue about how much Obama could have altered this
literally depressing turn of events. He could have pushed for a
larger, more extended stimulus, perhaps with provisions for
extra aid that would have kicked in if unemployment stayed
high. (This isn't 20-20 hindsight, because a number of
economists, myself included, pleaded for more aggressive
measures from the beginning.) He arguably let Republicans
blackmail him over the debt ceiling in 2011, leading to the
sequester. But this is all kind of iffy.
The bottom line on Obama's economic policy should be that
what he did helped the economy, and that while enormous
economic and human damage has taken place on his watch,
the United States coped with the financial crisis better than
most countries facing comparable crises have managed. He
should have done more and better, but the narrative that
portrays his policies as a simple failure is all wrong.
While America remains an incredibly unequal society, and
we haven't seen anything like the New Deal's efforts to
narrow income gaps, Obama has done more to limit
inequality than he gets credit for. The rich are paying higher
taxes, thanks to the partial expiration of the Bush tax cuts and
the special taxes on high incomes that help pay for
Obamacare; the Congressional Budget Office estimates the
average tax rate of the top one percent at 33.6 percent in
2013, up from 28.1 percent in 2008. Meanwhile, the financial
aid in Obamacare – expanded Medicaid, subsidies to help
lower-income households pay insurance premiums – goes
disproportionately to less-well-off Americans. When
conservatives accuse Obama of redistributing income, they're
not completely wrong – and liberals should give him credit.
THE ENVIRONMENT
In 2009, it looked, briefly, as if we might be about to get real
on the issue of climate change. A fairly comprehensive bill
establishing a cap-and-trade system to limit greenhouse-gas
emissions actually passed the House, and visions of global
action danced like sugarplums in environmentalists' heads.
But the legislation stalled in the Senate, and Republican
victory in the 2010 midterms put an end to that fantasy. Ever
since, the only way forward has been through executive
action based on existing legislation, which is a poor substitute
for the new laws we need.
RELATED: The Turning Point: New Hope for the
Climate
But as with financial reform, acknowledging the inadequacy
of what has been done doesn't mean that nothing has been
achieved. Saying that Obama has been the best environmental
president in a long time is actually faint praise, since George
W. Bush was terrible and Bill Clinton didn't get much done.
Still, it's true, and there's reason to hope for a lot more over
the next two years First of all, there has been much more progress on the use of
renewable energy than most people realize. The share of U.S.
energy provided by wind and solar has grown dramatically
since Obama took office. True, it's still only a small fraction of
the total, and some of the growth in renewables reflects
technological progress, especially in solar panels, that would
have happened whoever was in office. But federal policies,
including loan guarantees and tax credits, have played an
important role.
Nor is it just about renewables; Obama has also taken big
steps on energy conservation, especially via fuel-efficiency
standards, that have flown, somewhat mysteriously, under the
radar. And it's not just cars. In 2011, the administration
announced the first-ever fuel-efficiency standards for
medium and heavy vehicles, and in February it announced
that these standards would get even tougher for models sold
after 2018. As a way to curb green house-gas emissions, these
actions, taken together, are comparable in importance to
proposed action on power plants.
Which brings us to the latest initiative. Because there's no
chance of getting climate-change legislation through Congress
for the foreseeable future, Obama has turned to the EPA's
existing power to regulate pollution – power that the Supreme
Court has affirmed extends to emissions of carbon dioxide
and other greenhouse gases. And this past summer, the EPA
announced proposed rules that would require a large
reduction over time in such emissions from power plants. You
might say that such plants are only a piece of the problem, but
they're a large piece – CO2 from coal-burning power plants is
in fact a big part of the problem, so if the EPA goes through
with anything like the proposed rule, it will be a major step.
Again, not nearly enough, and we'll have to do a lot more
soon, or face civilization-threatening disaster. But what
Obama has done is far from trivial.
NATIONAL SECURITY
So far, i've been talking about Obama's positive
achievements, which have been much bigger than his critics
understand. I do, however, need to address one area that has
left some early Obama supporters bitterly disappointed: his
record on national security policy. Let's face it – many of his
original enthusiasts favored him so strongly over Hillary
Clinton because she supported the Iraq War and he didn't.
They hoped he would hold the people who took us to war on
false pretenses accountable, that he would transform
American foreign policy, and that he would drastically curb
the reach of the national security state.
RELATED: Obama Vs. The Hawks
None of that happened. Obama's team, as far as we can tell,
never even considered going after the deceptions that took us
to Baghdad, perhaps because they believed that this would
play very badly at a time of financial crisis. On overall
foreign policy, Obama has been essentially a normal post-
Vietnam president, reluctant to commit U.S. ground troops
and eager to extract them from ongoing commitments, but
quite willing to bomb people considered threatening to U.S.
interests. And he has defended the prerogatives of the NSA
and the surveillance state in general.
Could and should he have been different? The truth is that I
have no special expertise here; as an ordinary concerned
citizen, I worry about the precedent of allowing what amount
to war crimes to go not just unpunished but uninvestigated,
even while appreciating that a modern version of the 1970s
Church committee hearings on CIA abuses might well have
been a political disaster, and undermined the policy
achievements I've tried to highlight. What I would say is that
even if Obama is just an ordinary president on national
security issues, that's a huge improvement over what came
before and what we would have had if John McCain or Mitt
Romney had won. It's hard to get excited about a policy of not
going to war gratuitously, but it's a big deal compared
with the alternative.
SOCIAL CHANGE
In 2004, social issues, along with national security, were
cudgels the right used to bludgeon liberals – I like to say that
Bush won re-election by posing as America's defender against
gay married terrorists. Ten years later, and the scene is
transformed: Democrats have turned these social issues –
especially women's rights – against Republicans; gay marriage
has been widely legalized with approval or at least
indifference from the wider public. We have, in a remarkably
short stretch of time, become a notably more tolerant, open-
minded nation.
Barack Obama has been more a follower than a leader on
these issues. But at least he has been willing to follow the
country's new open-mindedness. We shouldn't take this for
granted. Before the Obama presidency, Democrats were in a
kind of reflexive cringe on social issues, acting as if the
religious right had far more power than it really does and
ignoring the growing constituency on the other side. It's easy
to imagine that if someone else had been president these past
six years, Democrats would still be cringing as if it were 2004.
Thankfully, they aren't. And the end of the cringe also, I'd
argue, helped empower them to seek real change on
substantive issues from health reform to the environment.
Which brings me back to domestic issues.
As you can see, there's a theme running through each of the
areas of domestic policy I've covered. In each case, Obama
delivered less than his supporters wanted, less than the
country arguably deserved, but more than his current
detractors acknowledge. The extent of his partial success
ranges from the pretty good to the not-so-bad to the ugly.
Health reform looks pretty good, especially in historical
perspective – remember, even Social Security, in its original
FDR version, only covered around half the workforce.
Financial reform is, I'd argue, not so bad – it's not the second
coming of Glass-Steagall, but there's a lot more protection
against runaway finance than anyone except angry Wall
Streeters seems to realize. Economic policy wasn't enough to
avoid a very ugly period of high unemployment, but Obama
did at least mitigate the worst.
And as far as climate policy goes, there's reason for hope, but
we'll have to see.
Am I damning with faint praise? Not at all. This is what a
successful presidency looks like. No president gets to do
everything his supporters expected him to. FDR left behind a
reformed nation, but one in which the wealthy retained a lot
of power and privilege. On the other side, for all his anti-
government rhetoric, Reagan left the core institutions of the
New Deal and the Great Society in place. I don't care about
the fact that Obama hasn't lived up to the golden dreams of
2008, and I care even less about his approval rating. I do care
that he has, when all is said and done, achieved a lot. That is,
as Joe Biden didn't quite say, a big deal.
sync. Back in 2008, when many liberals were wildly
enthusiastic about his candidacy and his press was strongly
favorable, I was skeptical. I worried that he was naive, that
his talk about transcending the political divide was a
dangerous illusion given the unyielding extremism of the
modern American right. Furthermore, it seemed clear to me
that, far from being the transformational figure his
supporters imagined, he was rather conventional-minded:
Even before taking office, he showed signs of paying far too
much attention to what some of us would later take to calling
Very Serious People, people who regarded cutting budget
deficits and a willingness to slash Social Security as the very
essence of political virtue.
RELATED: Hope and Change Index: 6 Years of
Progress, By the Numbers
And I wasn't wrong. Obama was indeed naive: He faced
scorched-earth Republican opposition from Day One, and it
took him years to start dealing with that opposition
realistically. Furthermore, he came perilously close to doing
terrible things to the U.S. safety net in pursuit of a budget
Grand Bargain; we were saved from significant cuts to Social
Security and a rise in the Medicare age only by Republican
greed, the GOP's unwillingness to make even token
concessions.
But now the shoe is on the other foot: Obama faces trash talk
left, right and center – literally – and doesn't deserve it.
Despite bitter opposition, despite having come close to self-
inflicted disaster, Obama has emerged as one of the most
consequential and, yes, successful presidents in American
history. His health reform is imperfect but still a huge step
forward – and it's working better than anyone expected.
Financial reform fell far short of what should have happened,
but it's much more effective than you'd think. Economic
management has been half-crippled by Republican
obstruction, but has nonetheless been much better than in
other advanced countries. And environmental policy is
starting to look like it could be a major legacy.
I'll go through those achievements shortly. First, however,
let's take a moment to talk about the current wave of Obama-
bashing. All Obama-bashing can be divided into three types.
One, a constant of his time in office, is the onslaught from the
right, which has never stopped portraying him as an Islamic
atheist Marxist Kenyan. Nothing has changed on that front,
and nothing will.
Photo: Sean Gallup/Getty
There's a different story on the left, where you now find a
significant number of critics decrying Obama as, to quote
Cornel West, someone who ''posed as a progressive and
turned out to be counterfeit.'' They're outraged that Wall
Street hasn't been punished, that income inequality remains
so high, that ''neoliberal'' economic policies are still in place.
All of this seems to rest on the belief that if only Obama had
put his eloquence behind a radical economic agenda, he could
somehow have gotten that agenda past all the political
barriers that have con- strained even his much more modest
efforts. It's hard to take such claims seriously.
Finally, there's the constant belittling of Obama from
mainstream pundits and talking heads. Turn on cable news
(although I wouldn't advise it) and you'll hear endless talk
about a rudderless, stalled administration, maybe even about
a failed presidency. Such talk is often buttressed by polls
showing that Obama does, indeed, have an approval rating
that is very low by historical standards.
But this bashing is misguided even in its own terms – and in
any case, it's focused on the wrong thing.
Yes, Obama has a low approval rating compared with earlier
presidents. But there are a number of reasons to believe that
presidential approval doesn't mean the same thing that it
used to: There is much more party-sorting (in which
Republicans never, ever have a good word for a Democratic
president, and vice versa), the public is negative on
politicians in general, and so on. Obviously the midterm
election hasn't happened yet, but in a year when Republicans
have a huge structural advantage – Democrats are defending a
disproportionate number of Senate seats in deep-red states –
most analyses suggest that control of the Senate is in doubt,
with Democrats doing considerably better than they were
supposed to. This isn't what you'd expect to see if a failing
president were dragging his party down.
More important, however, polls – or even elections – are not
the measure of a president. High office shouldn't be about
putting points on the electoral scoreboard, it should be about
changing the country for the better. Has Obama done that? Do
his achievements look likely to endure? The answer to both
questions is yes.
HEALTH CARE
When Obama signed the Affordable Care Act, an excited Joe
Biden whispered audibly, ''This is a big fucking deal!'' He was
right.
RELATED: Obamacare: It's Working!
The enactment and implementation of the Affordable Care
Act, a.k.a. Obamacare, has been a perils-of-Pauline
experience. When an upset in the special election to replace
Ted Kennedy cost Democrats their 60-vote Senate majority,
health reform had to be rescued with fancy legislative
footwork. Then it survived a Supreme Court challenge only
thanks to a surprise display of conscience by John Roberts,
who nonetheless opened a loophole that has allowed
Republican-controlled states to deny coverage to millions of
Americans. Then technical difficulties with the
HealthCare.gov website seemed to threaten disaster. But
here we are, most of the way through the first full year of
reform's implementation, and it's working better than even
the optimists expected.
We won't have the full data on 2014 until next year's census
report, but multiple independent surveys show a sharp drop
in the number of Americans without health insurance,
probably around 10 million, a number certain to grow greatly
over the next two years as more people realize that the
program is available and penalties for failure to sign up
increase.
It's true that the Affordable Care Act will still leave millions of
people in America uninsured. For one thing, it was never
intended to cover undocumented immigrants, who are
counted in standard measures of the uninsured. Furthermore,
millions of low-income Americans will slip into the loophole
Roberts created: They were supposed to be covered by a
federally funded expansion of Medicaid, but some states are
blocking that expansion out of sheer spite. Finally, unlike
Social Security and Medicare, for which almost everyone is
automatically eligible, Obamacare requires beneficiaries to
prove their eligibility for Medicaid or choose and then pay for
a subsidized private plan. Inevitably, some people will fall
through the cracks.
Still, Obamacare means a huge improvement in the quality of
life for tens of millions of Americans – not just better care,
but greater financial security. And even those who were
already insured have gained both security and freedom,
because they now have a guarantee of coverage if they lose or
change jobs.
What about the costs? Here, too, the news is better than
anyone expected. In 2014, premiums on the insurance
policies offered through the Obamacare exchanges were well
below those originally projected by the Congressional Budget
Office, and the available data indicates a mix of modest
increases and actual reductions for 2015 – which is very good
in a sector where premiums normally increase five percent or
more each year. More broadly, overall health spending has
slowed substantially, with the cost-control features of the ACA
probably deserving some of the credit.
In other words, health reform is looking like a major policy
success story. It's a program that is coming in ahead of
schedule – and below budget – costing less, and doing more to
reduce overall health costs than even its supporters predicted.
Of course, this success story makes nonsense of right-wing
predictions of catastrophe. Beyond that, the good news on
health costs refutes conservative orthodoxy. It's a fixed idea
on the right, sometimes echoed by ''centrist'' commentators,
that the only way to limit health costs is to dismantle
guarantees of adequate care – for example, that the only way
to control Medicare costs is to replace Medicare as we know
it, a program that covers major medical expenditures, with
vouchers that may or may not be enough to buy adequate
insurance. But what we're actually seeing is what looks like
significant cost control via a laundry list of small changes to
how we pay for care, with the basic guarantee of adequate
coverage not only intact but widened to include Americans of
all ages.
It's worth pointing out that some criticisms of Obamacare
from the left are also looking foolish. Obamacare is a system
partly run through private insurance companies (although
expansion of Medicaid is also a very important piece). And
some on the left were outraged, arguing that the program
would do more to raise profits in the medical-industrial
complex than it would to protect American families.
You can still argue that single-payer would have covered more
people at lower cost – in fact, I would. But that option wasn't
on the table; only a system that appeased insurers and
reassured the public that not too much would change was
politically feasible. And it's working reasonably well:
Competition among insurers who can no longer deny
insurance to those who need it most is turning out to be
pretty effective. This isn't the health care system you would
have designed from scratch, or if you could ignore special-
interest politics, but it's doing the job.
And this big improvement in American society is almost
surely here to stay. The conservative health care nightmare –
the one that led Republicans to go all-out against Bill Clinton's
health plans in 1993 and Obamacare more recently – is that
once health care for everyone, or almost everyone, has been
put in place, it will be very hard to undo, because too many
voters would have a stake in the system. That's exactly what
is happening. Republicans are still going through the motions
of attacking Obamacare, but the passion is gone. They're even
offering mealymouthed assurances that people won't lose
their new benefits. By the time Obama leaves office, there will
be tens of millions of Americans who have benefited directly
from health reform – and that will make it almost impossible
to reverse. Health reform has made America a different,
better place.
Photo: Susan Walsh/AP
FINANCIAL REFORM
Let's be clear: The financial crisis should have been followed
by a drastic crackdown on Wall Street abuses, and it wasn't.
No important figures have gone to jail; bad banks and other
financial institutions, from Citigroup to Goldman, were bailed
out with few strings attached; and there has been nothing like
the wholesale restructuring and reining in of finance that
took place in the 1930s. Obama bears a considerable part of
the blame for this disappointing response. It was his Treasury
secretary and his attorney general who chose to treat finance
with kid gloves.
It's easy, however, to take this disappointment too far. You
often hear Dodd- Frank, the financial-reform bill that Obama
signed into law in 2010, dismissed as toothless and
meaningless. It isn't. It may not prevent the next financial
crisis, but there's a good chance that it will at least make
future crises less severe and easier to deal with.
Dodd-Frank is a complicated piece of legislation, but let me
single out three really important sections.
First, the law gives a special council the ability to designate
''systemically important financial institutions'' (SIFIs) – that
is, institutions that could create a crisis if they were to fail –
and place such institutions under extra scrutiny and
regulation of things like the amount of capital they are
required to maintain to cover possible losses. This provision
has been derided as ineffectual or worse – during the 2012
presidential campaign, Mitt Romney claimed that by
announcing that some firms were SIFIs, the government was
effectively guaranteeing that they would be bailed out, which
he called ''the biggest kiss that's been given to New York
banks I've ever seen.''
But it's easy to prove that this is nonsense: Just look at how
institutions behave when they're designated as SIFIs. Are they
pleased, because they're now guaranteed? Not a chance.
Instead, they're furious over the extra regulation, and in
some cases fight bitterly to avoid being placed on the list.
Right now, for example, MetLife is making an all-out effort to
be kept off the SIFI list; this effort demonstrates that we're
talking about real regulation here, and that financial interests
don't like it.
Another key provision in Dodd-Frank is ''orderly liquidation
authority,'' which gives the government the legal right to seize
complex financial institutions in a crisis. This is a bigger deal
than you might think. We have a well-established procedure
for seizing ordinary banks that get in trouble and putting
them into receivership; in fact, it happens all the time. But
what do you do when something like Citigroup is on the edge,
and its failure might have devastating consequences? Back in
2009, Joseph Stiglitz and yours truly, among others, wanted to
temporarily nationalize one or two major financial players,
for the same reasons the FDIC takes over failing banks, to
keep the institutions running but avoid bailing out
stockholders and management. We got a chance to make that
case directly to the president. But we lost the argument, and
one key reason was Treasury's claim that it lacked the
necessary legal authority. I still think it could have found a
way, but in any case that won't be an issue next time.
A third piece of Dodd-Frank is the Consumer Financial
Protection Bureau. That's Elizabeth Warren's brainchild, an
agency dedicated to protecting Americans against the
predatory lending that has pushed so many into financial
distress, and played an important role in the crisis. Warren's
idea was that such a stand-alone agency would more
effectively protect the public than agencies that were
supposed to protect consumers, but saw their main job as
propping up banks. And by all accounts the new agency is in
fact doing much more to crack down on predatory practices
than anything we used to see.
There's much more in the financial reform, including a
number of pieces we don't have enough information to
evaluate yet. But there's enough evidence even now to say
that there's a reason Wall Street – which used to give an
approximately equal share of money to both parties but now
overwhelmingly supports Republicans – tried so hard to kill
financial reform, and is still trying to emasculate Dodd-Frank.
This may not be the full overhaul of finance we should have
had, and it's not as major as health reform. But it's a lot
better than nothing.
THE ECONOMY
Barack Obama might not have been elected president without
the 2008 financial crisis; he certainly wouldn't have had the
House majority and the brief filibuster-proof Senate majority
that made health reform possible. So it's very disappointing
that six years into his presidency, the U.S. economy is still a
long way from being fully recovered.
Before we ask why, however, we should note that things could
have been worse. In fact, in other times and places they have
been worse. Make no mistake about it – the devastation
wrought by the financial crisis was terrible, with real income
falling 5.5 percent. But that's actually not as bad as the
''typical'' experience after financial crises: Even in advanced
countries, the median post-crisis decline in per- capita real
GDP is seven percent. Recovery has been slow: It took almost
six years for the United States to regain pre-crisis average
income. But that was actually a bit faster than the historical
average.
Or compare our performance with that of the European
Union. Unemployment in America rose to a horrifying 10
percent in 2009, but it has come down sharply in the past few
years. It's true that some of the apparent improvement
probably reflects discouraged workers dropping out, but there
has been substantial real progress. Meanwhile, Europe has
had barely any job recovery at all, and unemployment is still
in double digits. Compared with our counterparts across the
Atlantic, we haven't done too badly.
Did Obama's policies contribute to this less-awful
performance? Yes, without question. You'd never know it
listening to the talking heads, but there's overwhelming
consensus among economists that the Obama stimulus plan
helped mitigate the worst of the slump. For example, when a
panel of economic experts was asked whether the U.S.
unemployment rate was lower at the end of 2010 than it
would have been without the stimulus, 82 percent said yes,
only two percent said no.
Still, couldn't the U.S. economy have done a lot better? Of
course. The original stimulus should have been both bigger
and longer. And after Republicans won the House in 2010,
U.S. policy took a sharp turn in the wrong direction. Not only
did the stimulus fade out, but sequestration led to further
steep cuts in federal spending, exactly the wrong thing to do
in a still-depressed economy.
We can argue about how much Obama could have altered this
literally depressing turn of events. He could have pushed for a
larger, more extended stimulus, perhaps with provisions for
extra aid that would have kicked in if unemployment stayed
high. (This isn't 20-20 hindsight, because a number of
economists, myself included, pleaded for more aggressive
measures from the beginning.) He arguably let Republicans
blackmail him over the debt ceiling in 2011, leading to the
sequester. But this is all kind of iffy.
The bottom line on Obama's economic policy should be that
what he did helped the economy, and that while enormous
economic and human damage has taken place on his watch,
the United States coped with the financial crisis better than
most countries facing comparable crises have managed. He
should have done more and better, but the narrative that
portrays his policies as a simple failure is all wrong.
While America remains an incredibly unequal society, and
we haven't seen anything like the New Deal's efforts to
narrow income gaps, Obama has done more to limit
inequality than he gets credit for. The rich are paying higher
taxes, thanks to the partial expiration of the Bush tax cuts and
the special taxes on high incomes that help pay for
Obamacare; the Congressional Budget Office estimates the
average tax rate of the top one percent at 33.6 percent in
2013, up from 28.1 percent in 2008. Meanwhile, the financial
aid in Obamacare – expanded Medicaid, subsidies to help
lower-income households pay insurance premiums – goes
disproportionately to less-well-off Americans. When
conservatives accuse Obama of redistributing income, they're
not completely wrong – and liberals should give him credit.
THE ENVIRONMENT
In 2009, it looked, briefly, as if we might be about to get real
on the issue of climate change. A fairly comprehensive bill
establishing a cap-and-trade system to limit greenhouse-gas
emissions actually passed the House, and visions of global
action danced like sugarplums in environmentalists' heads.
But the legislation stalled in the Senate, and Republican
victory in the 2010 midterms put an end to that fantasy. Ever
since, the only way forward has been through executive
action based on existing legislation, which is a poor substitute
for the new laws we need.
RELATED: The Turning Point: New Hope for the
Climate
But as with financial reform, acknowledging the inadequacy
of what has been done doesn't mean that nothing has been
achieved. Saying that Obama has been the best environmental
president in a long time is actually faint praise, since George
W. Bush was terrible and Bill Clinton didn't get much done.
Still, it's true, and there's reason to hope for a lot more over
the next two years First of all, there has been much more progress on the use of
renewable energy than most people realize. The share of U.S.
energy provided by wind and solar has grown dramatically
since Obama took office. True, it's still only a small fraction of
the total, and some of the growth in renewables reflects
technological progress, especially in solar panels, that would
have happened whoever was in office. But federal policies,
including loan guarantees and tax credits, have played an
important role.
Nor is it just about renewables; Obama has also taken big
steps on energy conservation, especially via fuel-efficiency
standards, that have flown, somewhat mysteriously, under the
radar. And it's not just cars. In 2011, the administration
announced the first-ever fuel-efficiency standards for
medium and heavy vehicles, and in February it announced
that these standards would get even tougher for models sold
after 2018. As a way to curb green house-gas emissions, these
actions, taken together, are comparable in importance to
proposed action on power plants.
Which brings us to the latest initiative. Because there's no
chance of getting climate-change legislation through Congress
for the foreseeable future, Obama has turned to the EPA's
existing power to regulate pollution – power that the Supreme
Court has affirmed extends to emissions of carbon dioxide
and other greenhouse gases. And this past summer, the EPA
announced proposed rules that would require a large
reduction over time in such emissions from power plants. You
might say that such plants are only a piece of the problem, but
they're a large piece – CO2 from coal-burning power plants is
in fact a big part of the problem, so if the EPA goes through
with anything like the proposed rule, it will be a major step.
Again, not nearly enough, and we'll have to do a lot more
soon, or face civilization-threatening disaster. But what
Obama has done is far from trivial.
NATIONAL SECURITY
So far, i've been talking about Obama's positive
achievements, which have been much bigger than his critics
understand. I do, however, need to address one area that has
left some early Obama supporters bitterly disappointed: his
record on national security policy. Let's face it – many of his
original enthusiasts favored him so strongly over Hillary
Clinton because she supported the Iraq War and he didn't.
They hoped he would hold the people who took us to war on
false pretenses accountable, that he would transform
American foreign policy, and that he would drastically curb
the reach of the national security state.
RELATED: Obama Vs. The Hawks
None of that happened. Obama's team, as far as we can tell,
never even considered going after the deceptions that took us
to Baghdad, perhaps because they believed that this would
play very badly at a time of financial crisis. On overall
foreign policy, Obama has been essentially a normal post-
Vietnam president, reluctant to commit U.S. ground troops
and eager to extract them from ongoing commitments, but
quite willing to bomb people considered threatening to U.S.
interests. And he has defended the prerogatives of the NSA
and the surveillance state in general.
Could and should he have been different? The truth is that I
have no special expertise here; as an ordinary concerned
citizen, I worry about the precedent of allowing what amount
to war crimes to go not just unpunished but uninvestigated,
even while appreciating that a modern version of the 1970s
Church committee hearings on CIA abuses might well have
been a political disaster, and undermined the policy
achievements I've tried to highlight. What I would say is that
even if Obama is just an ordinary president on national
security issues, that's a huge improvement over what came
before and what we would have had if John McCain or Mitt
Romney had won. It's hard to get excited about a policy of not
going to war gratuitously, but it's a big deal compared
with the alternative.
SOCIAL CHANGE
In 2004, social issues, along with national security, were
cudgels the right used to bludgeon liberals – I like to say that
Bush won re-election by posing as America's defender against
gay married terrorists. Ten years later, and the scene is
transformed: Democrats have turned these social issues –
especially women's rights – against Republicans; gay marriage
has been widely legalized with approval or at least
indifference from the wider public. We have, in a remarkably
short stretch of time, become a notably more tolerant, open-
minded nation.
Barack Obama has been more a follower than a leader on
these issues. But at least he has been willing to follow the
country's new open-mindedness. We shouldn't take this for
granted. Before the Obama presidency, Democrats were in a
kind of reflexive cringe on social issues, acting as if the
religious right had far more power than it really does and
ignoring the growing constituency on the other side. It's easy
to imagine that if someone else had been president these past
six years, Democrats would still be cringing as if it were 2004.
Thankfully, they aren't. And the end of the cringe also, I'd
argue, helped empower them to seek real change on
substantive issues from health reform to the environment.
Which brings me back to domestic issues.
As you can see, there's a theme running through each of the
areas of domestic policy I've covered. In each case, Obama
delivered less than his supporters wanted, less than the
country arguably deserved, but more than his current
detractors acknowledge. The extent of his partial success
ranges from the pretty good to the not-so-bad to the ugly.
Health reform looks pretty good, especially in historical
perspective – remember, even Social Security, in its original
FDR version, only covered around half the workforce.
Financial reform is, I'd argue, not so bad – it's not the second
coming of Glass-Steagall, but there's a lot more protection
against runaway finance than anyone except angry Wall
Streeters seems to realize. Economic policy wasn't enough to
avoid a very ugly period of high unemployment, but Obama
did at least mitigate the worst.
And as far as climate policy goes, there's reason for hope, but
we'll have to see.
Am I damning with faint praise? Not at all. This is what a
successful presidency looks like. No president gets to do
everything his supporters expected him to. FDR left behind a
reformed nation, but one in which the wealthy retained a lot
of power and privilege. On the other side, for all his anti-
government rhetoric, Reagan left the core institutions of the
New Deal and the Great Society in place. I don't care about
the fact that Obama hasn't lived up to the golden dreams of
2008, and I care even less about his approval rating. I do care
that he has, when all is said and done, achieved a lot. That is,
as Joe Biden didn't quite say, a big deal.
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