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Voters may not follow every twist and turn of the election -- they may not brush up on each of the candidates' policy proposals -- but they know when they're hurting economically, and almost unprecedented numbers now say the country is on "the wrong track."
The Bush years have been bad. In fact, as economist Jared Bernstein noted, when one compares the economic peak of the past cycle, in 2000, with the high point of the business cycle that just ended in 2007, households in the middle actually lost ground, earning $300, adjusted for inflation, less than they did in 2000. The worst this group had done in previous business cycles occurred during the 1970s, when median income "only" increased by about $2,000. In comparison, the income for a family in the middle rose by almost four grand during the 1990s.
It's the first time since they started keeping records of family income after World War II that the economy has gone into a recession before the middle class, those iconic "American families" that dominate our political discourse, had rebounded fully from the previous downturn. That represents an immensely painful double-dip for those in the middle and at the bottom -- only those in the top fifth of the economic ladder have seen any gains whatsoever since the last recession (officially) ended in 2001. (The wages of the bottom fifth fell by 6 percent, while those in the top 1 percent saw their incomes rise by about 50 percent during what some conservative pundits have called the "Bush Boom").
But it's important to understand that Bushenomics only represents an extreme iteration of the ideology that's prevailed since the 1973 energy crisis and the dawn of the "Reagan Revolution." The pain that working America feels today is the culmination of a far longer trend. An analysis by economists Thomas Piketty and Emmanuel Saez offers perhaps the most compelling indictment of neoliberal economics. They sliced and diced the American economy, going back to the beginning of the last century, and they found that between 1973 and 2003, despite several periods of healthy growth, the average real income of all but the top 10 percent of the economic ladder -- 9 out of 10 American families -- actually fell by about 4 percent over those 30-plus years. Meanwhile, the incomes of the top 10 percent of American households increased by around two-thirds.
It's a unique moment in history, with the country facing a deep, structural energy crisis, with a tattered reputation and dwindling influence abroad and a sputtering economy at home. But in moments of crisis, there is often opportunity. The public now appears to be uniquely receptive to a bold progressive agenda, more so than at any other point in recent memory.
The question that will be answered over the coming weeks is how aggressive the Obama campaign will be in articulating such an agenda -- whether a campaign that has moved to a steady but generic drumbeat of "change" can widen the discussion from the failures of the Bush administration to the disastrous consequences of the larger conservative project over the past 30 years and offer the voters some concrete proposals to restore Americans' tattered sense of economic security.
What Kind of "Change" Are We Talking About?
The neoliberal project -- the idea that business, when largely unregulated, has some sort of magical virtue that renders the idea of a healthy social safety net a quaint but antiquated notion -- has failed, and done so spectacularly over a long period of time.
Noam Chomsky has said (and I'm paraphrasing) that for the adherents of neoliberalism, the answer to each and every one of its failures is more neoliberalism, and John McCain epitomizes that approach. His economic prescriptions are as simple as they are familiar: Cut taxes for top earners, privatize as many chunks of the public sphere as possible, and let "the market" deal with whatever dislocations result. To keep the masses from becoming unruly, throw some crumbs their way -- job retraining, trade "adjustment assistance," maybe a grudging increase in the minimum wage (actually, McCain has voted 19 times against raising the minimum).
See more stories tagged with: obama, mccain, economy, election08
Joshua Holland is an AlterNet staff writer.
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