President's Question:

4 Responses to “What early policies can President Obama pursue to renew public spirit?”

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   Susan Buck-Morss :
   November 9th, 2008 at 2:20 pm

   Culture Wars policy issues would be an excellent choice for early action, because they send a strong message while entailing little economic cost. Many of these issues (definition of torture; status of Guantanamo prisoners; support for stem cell research, state emissions standards, and family planning options) were Bush policies by fiat. Here’s the time to take the “expanded executive powers” doctrine of the Bush administration and turn its consequences upside down!

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   Dorothy Holland :
   November 11th, 2008 at 4:26 pm

   Youth’s response to the Obama campaign created visions of a better, less rancorous, “can-do” America. The election results, Obama’s speeches, the outpouring of happiness around the world have produced a euphoria that takes this proto-movement to a wider age range. With certain early policies and programs, Obama’s team can build more solidarity tied to an interest in the public good and an engagement with public service and ensure that many people become more experienced and more active contributors to the country’s well being.

   The campaign has already begun changing people’s ideas about the government from “getting government off people’s backs” to “the country working together can do amazing things that make history”; the country needs its citizens’ ideas, time, contributions, no matter how small; help from the government (e.g., college tuition) deserves reciprocal help from the recipients (e.g., public service).

   EXPAND OPPORTUNITIES FOR PUBLIC SERVICE AND INTERNSHIPS ESPECIALLY FOR YOUTH

   I study the formation of personal identities or senses of self–the way in which people come to have a sense of themselves as environmentalists, for example, and come to care about whether they act according to their claims. These identities form, if anywhere, in the process of engagement with a community of practice where the identities are important. These communities of practice are also crucial sites where people become much more knowledgeable about what counts as environmental action or, in the present case, what counts as contributing to the country. The policy of expanding opportunities for public service could be carried out through expanding Americorp, for example, or building programs on the model of Teach for America to provide educational, health, and other services to underserved areas. Internships in “engaged scholarship” where faculty and students work with communities on research/action projects are another opportunity for increasing students’ commitment to and knowledge of the public good.

   The following two areas of policy and program support are aimed at solidarity and public service on the local level. Just as the work of many volunteers on the campaign took place in communities, these experiences are important for expanding people’s understandings of what it takes to make local changes that affect the whole country. Through rhetorical campaigns at the federal level, along with some funding, these local efforts can be channeled to create a sense of imagined community (nation) and encourage the solidarity that Benedict Anderson’s 1983 book envisioned.

   BUILD STRONG PARTICIPATORY DEMOCRACY TO SUPPORT THE COUNTRY’S SOCIAL SERVICE INFRASTRUCTURE

   Holland, et al. (2007), in their study of peoples’ relationships with their local government, note the importance of community-oriented voluntary associations, non-profits and public/private partnerships. With neoliberal calls to decrease government provision of social services, populations have become dependent on civil-society organizations for their well being. If there is no will to rebuild government services, then these organizations need more government support. We call for the expanded creation of “empowered participatory governance” noting that voluntary associations continue to be important “schools for democracy”.

   BUILD ON INTEREST IN LOCAL ECONOMIES TO DEVELOP COMMUNITY ENGAGEMENTS AND INTERDEPENDENCE

   My recent research has alerted me to extensive activist efforts to create sustainable local economies. Local food activists, for example, strive to rebuild local food production in order to promote better health, lower the environmental footprint, keep money in the local economy, encourage people to become more involved in their own food production and further community. This attends to public interest and is couched in creating community solidarity. It certainly gives people the sense of growing the economy from the bottom up.

   UNDERTAKE ACHIEVEMENT OF A NATIONAL GOAL

   Finally, in the spirit of the need for experimentation in difficult times, Obama’s team should try adapting the community-organizing genius of the campaign to addressing a national goal. The effort would involve choosing, with considerable input, a national goal that most Americans would approve (e.g., increasing high school graduation through volunteer efforts). The experiment would build on the model of the national campaign strategy to create networks at state, city, town, and neighborhood levels to design and organize local action toward this goal. With support in capacity building, these groups would work to develop concrete projects to achieve the goal while maintaining positive interactions, and shared experiences designed to maintain the momentum of the campaign’s slogan, “Yes, we can”.

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   Rogers Brubaker :
   November 12th, 2008 at 5:22 am

   1. The deepening crisis in which President Obama will take office imposes constraints, but also affords opportunities. With the resources of monetary policy exhausted, and economic indicators worsening daily, economists of various political orientations agree on the need for a massive fiscal stimulus in the short term, even as concerns mount over burgeoning deficits in the medium to longer term.

   While most attention has focused on the collapse of the stock market, the decline in housing prices, and the freezing up of credit markets, the heaviest costs of the massive economic downturn that is gathering momentum will be borne by the least privileged. President Obama should seek to ensure that any stimulus package gives priority to aiding those most in need. This can be done — among other ways — through infrastructure spending to spur job creation. It can be done by increasing and extending unemployment benefits (and eliminating taxes on them), increasing funding for and access to food stamp benefits, and expanding the earned income tax credit. It can be done by providing aid to state and local governments, who cannot run deficits, and who — faced with declining revenues — are therefore forced to cut spending on social programs when they ought to be increasing it.

   In addressing the crisis, President Obama should seek to place it in broader historical and political perspective. This would enable him to underscore the vast increase in inequality of recent decades, which has been closely linked to the massive “financialization” of the economy; to stress the importance of greater transparency and accountability; to underscore the failures of regulation that contributed to the crisis; and to make a case for the crucial role of government regulation in the constitution and functioning of a market economy.

   2. The role of government can be rearticulated in other domains as well. The transition is an opportunity for President Obama to emphasize the crucial role of government in protecting public health and safety, building and maintaining infrastructure, promoting research, educating the citizenry, protecting the environment, addressing global warming, developing renewable energy resources, and so on. It is a chance also to note the ways in which the anti-government stance and “starve-the-beast” strategy of the previous administration have undermined the capacity of key agencies to perform their functions. The recent large-scale salmonella outbreak and the deaths from a contaminated blood-thinning agent made in China, for example, have focused renewed concern on the safety of foods and medicines and on the inability of the FDA to monitor complex global supply chains. The transition is an opportunity for President Obama to highlight the crucial public mission of the FDA and to substantially increase its resources and staffing, as well as those of other key agencies.

   3. In his victory speech, President-Elect Obama called for “a new spirit of patriotism.” And patriotism was strikingly evident in the reactions to his victory, with crowds everywhere chanting “USA, USA”; revelers on St. Mark’s Place in Manhattan, of all unlikely places, singing the national anthem; and people across the nation emphasizing what Obama’s victory meant to them as Americans. During the campaign, Senator Obama remarked that he had stopped wearing a flag lapel pin because it had become a substitute for “true patriotism.” He will now have an opportunity to help redefine what “true patriotism” can mean.

   Debates about the meaning of patriotism, and about what it means to be an American, are as old as the Republic, but liberals’ contributions to these debates have been muted in the last few decades, and patriotism has come to be an issue “owned” by conservatives. President Obama will have an extraordinary opportunity to change the terms of these debates, to change the range of what can be said and done in the name of the nation.

   A redefined patriotism can help motivate and sustain civic engagement and public service. Service was a key theme of the Obama campaign; President Obama could quickly follow through on his proposal to sharply expand AmeriCorps and to double the number of Peace Corps participants. A redefined patriotism could also provide a framework for rethinking questions of belonging and membership — a framework within which President Obama, perhaps in alliance with Senator McCain, could take the lead in establishing a path to citizenship for undocumented immigrants. Finally, a redefined patriotism could be used to help articulate a new vision of America’s place in the world, and to justify the closure of the Guantanamo prison and the withdrawal of troops from Iraq.

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   Juan E. Corradi :
   November 13th, 2008 at 4:46 pm

   Ways Out of the Crisis
   By

   Juan Eugenio Corradi

   Translated by Remy Scalza

   A great crisis is also a great opportunity to institute reforms that ground an economy on a more sustainable basis. It is precisely this that is at stake right now in the United States, after a truly historic presidential election. The global capitalist system, with its base in the United States, has not been vanquished, though it is indeed in danger. Nonetheless, it is a system that boasts sizeable reserves, enormous advantages and a historical capacity to bet big. The time for new and radical state policies is upon us. Will the new government be up to the task?

   “You will see things, friend Sancho, that will make stones speak.” Don Quijote was right. The twenty-first century’s global capitalist crisis has given rise to a kind of rescue socialism, backed by the loftiest members of the global elite. And, to be honest, something very serious must be happening when orthodox economists start talking like Hegelian philosophers. Indeed, the president of the World Bank, the very technical and sensible Mr. Robert B. Zoelick, argues in an article published in The Washington Post that a world in crisis offers, in turn, a chance for greatness. Thesis: a capitalism dominated by the financial sector, without limits or restraints; Antithesis: a catastrophic crisis; Synthesis: a new, happy world, reorganized by strong and rational leaders and built around a healthier economy. It makes sense to take a closer look at this dialectic, which shows some optimism in place of the usual pessimism. In the end, Hegel himself said that the most sublime concepts are fruits of existence and that the essence of existence is overcoming pain.

   The first proof is easy. As increasing numbers of industries go bankrupt, that is, as the financial-real estate crisis impacts the “real economy,” the tendency is – given the general impotence of banks and multinational organizations – to regulate markets, nationalize businesses and move closer toward protectionism, i.e. some form of economic nationalism. While these trends may manifest themselves differently in diverse countries and regions, the conclusion is clear: the neo-liberal model is, beyond a shadow of a doubt, history. It has been replaced – silently, without preaching or ideological proclamations – by a pragmatic model, in essence “Chinese” (in the sense of Deng Xiao Ping), that nationalizes and regulates but falls short of constructing a planned economy. Just as the neo-liberal model generated a real revolution in the planetary division of labor – but a revolution built on a weak and speculative foundation – so the new model will create a new order and a new equilibrium, built on a more sustainable foundation, which will make possible a new era of accumulation.

   The second proof is more difficult, because it runs counter to common sense or, better put, counter to today’s hysteria. There are those who claim that the crisis marks the end of American hegemony and that U.S.-style capitalism will now be obliged to share power and profits with emerging and resurgent world powers: the BRICs, Europe, Russia and perhaps other countries with natural and energy resources. This claim is not completely erroneous. Comparative social indicators show the U.S. at a disadvantage relative to other countries and even to its own past prosperity in terms of health, education, social protection, transport, environmental stewardship and infrastructure. This is the consequence of a quarter-century of neglecting its own social and human capital while shifting the bulk of industrial production to other continents and compensating for this with deficit spending and speculation. This was the great illusion of “easy money:” economic growth sustained through massive consumption on credit, “guaranteed” by a false valorization of properties. The current crisis is nothing more that the dramatic and painful correction of the excesses of that phase of accumulation. But the crisis need not represent a terminal condition, provided that conditions for a strategic exit are fulfilled. I will now take a look at these conditions.

   Contrary to the titles screaming from the shelves of commercial bookstores, this crisis cannot be compared to the fall of the old Roman Empire. “Roman” collapses occur when a system expands too much and wanders dangerously far from its base. It is then attacked from the periphery and retreats, until finally the “barbarians” (those from the outside) seize the center and destroy it. In other words, it is an exogenic and centripetal process. The current global crisis, on the other hand, is endogenic and centrifugal: It began in the center of the system, contaminated the immediate surroundings and produced the most harmful effects on the periphery. This insight helps to make sense of the fact that, in the middle of the American collapse, governments and investors around the world are lining up to buy dollars rather than turning to other currencies. In this so-called “fall” of the American empire, the “barbarians” are not besieging the Capitol but seeking refuge there. What is this magic power of the dollar? Why, instead of repelling, does the dollar attract so many foreigners, above all the governments of those countries supposedly standing in line to replace the United States as the dominant power?

   Ever since the famous decoupling of the dollar from the gold standard, effected by President Nixon in 1971, the world has lived with a flexible, or floating, dollar. In that time, the United States has become the financial center of the world. After the decoupling, the Federal Reserve, the U.S. central bank, proceeded to issue the national currency, without any backing in precious metals, as an international currency. Since then, the Federal Reserve has regulated international interest rates and issued Treasury bonds that function as the true backing for the global dollar. This has enabled the United States to amass a foreign debt in its very own currency – a privilege that no other country has secured and one that is almost inconceivable. Today nearly all American liabilities for goods and services are owed in dollars. This kind of system is fail-proof: It represents the only truly “bullet-proof” system in the world.

   This system creates a tremendous asymmetry between the external exposure of the United States and of other countries. As Latin Americans who have suffered repeated foreign debt crises know all too well, financial obligations must be paid in the currencies of others. For the U.S., however, debts are paid by printing green bills. It is the only case of a country capable of determining the interest rate on its own foreign debt. To reprise my earlier argument, this system in question is circular, centrifugal and nearly unbeatable. Even the world’s biggest creditor, the People’s Republic of China – which boasts international reserves of more than 2 trillion dollars – has to play by this system’s rules. I will only be convinced of the end of American hegemony when this circular, dollar-based system is replaced by other reference currencies. And this seems unlikely.

   Now it should be clearer why the dollar system is centrifugal: It distributes the crisis from the inside to the outside, from the center to the periphery and, at the same time, prevents the unexpected breakage of the bonds of globalization. It is a system in which the creditor is at the mercy of the debtor. This enables the system, currently in crisis mode, to rebalance itself without loss of hegemony, provided that there is strategic management from the centers of power.

   Continuing with the example of China as creditor tied to the prow of the American debtor, this rebalancing act will be achieved through the accelerated development of the creditor’s domestic market, with greater domestic consumption and a progressive lessening of the need to invest reserves in the American debt. For the United States, this same process may afford the time needed to make significant investments – many of them “socialized” – in new, cutting edge technology – with an emphasis on “green” machinery – and in the modernization of infrastructure and human capital.

   Over the medium range (i.e. investments that see returns after 15 or 20 years) this strategy will drive a new cycle of growth, which will be less speculative and based more on technical and scientific content than on financial content. In other words, this growth will owe less to a “gambling economy” and more to a “real economy.” Provided there is effective management of public policy and a good sense of strategy, this new model of accumulation should arrive just in time to address, intelligently and productively (rather than merely defensively), the environmental challenges that loom over a planet that in a few decades time will be home to more than 9 billion people.

   Let’s be frank: The current global crises originated within the hegemonic power. They are crises of exuberance and not of anemia. In crises like these, the system “suspends” its own rules and ideology while it readjusts, ideally to reemerge as the engine that drives the growth of other countries engaged in the global economy. Any assessment of the leadership of a world power must take into account more than good times of growth and expansion. It must also consider the intensity of its “pain,” as Hegel would say, and, ultimately, the speed of its recovery.

   In this respect, the presidential election in the U.S. is the first test of the country’s capacity for recovery through means that are heterodox and novel, i.e. that are experimental. New and radical measures are precisely those that no one wants to take during “normal times.” In “normal times,” major political players and interest groups have the power to veto audacious policies and even those state policies that do not bear fruit within the short election cycle. But during “times of great crisis” the game changes. The main political actors grow paralyzed and the big interest groups find themselves in need of help. These times amount to a true “state of exception” and endow the ruling power a freedom of action inconceivable otherwise. For example, consider that, during the great depression of the 1930s, president Roosevelt enacted the era’s most daring (i.e. “socialist”) policies during the span of only 100 days.

   The time has come for a significant change in America’s ruling team, which is, of course, the world’s ruling team. Though it began in the financial sector, the crisis is already generating a global deflationary tendency, i.e. a true depression. The coming changes will be painful. The new ruling team must adopt mid-range and long-term state policies, the only kind of policies suitable for cultivating sustained global leadership over the course of the next century. The new president must rise above the two traditional parties and launch, with the backing of a good team, his own 100-day program. President-elect Barak Obama, in my opinion is up to the challenge. The other party, and its candidates, only offer the platitudes of tired men now condemned to regroup while in opposition.

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