At some point for most of Barack Obama’s supporters, the euphoria of his historic election gave way to a moment of disillusionment, perhaps even regret. That moment arrived for some on December 7, 2008, when Obama announced that conservative evangelical pastor Rick Warren would speak at his inauguration. “Abominable,” fumed John Aravosis on AmericaBlog. “Obama’s ‘inclusiveness’ mantra always seems to head only in one direction—an excuse to scorn progressives and embrace the Right,” seethed Salon’s Glenn Greenwald. On MSNBC, Rachel Maddow rode the story almost nightly: “I think the problem is getting larger for Barack Obama.” Negative thirty-four days into the start of the Obama presidency, the honeymoon was over.
If it is hard to believe that Obama’s presidency has amounted to a historic success, and has fulfilled most of his policy goals, that is because Obama’s supporters have experienced it as a continuous disappointment, frequently spiking onto outright panic, punctuated only by brief moments of joyous relief. “We are all incredibly frustrated,” Justin Ruben, MoveOn’s executive director, told the Washington Post in 2011. “I’m disappointed in Obama,” complained Steve Jobs, according to Walter Isaacson’s biography. Even Shepard Fairey, the artist who designed the famous “HOPE” poster of Barack Obama in 2008, quickly grew disillusioned. In 2015, Esquire asked Fairey if he thinks Obama has lived up to his poster. “Not even close,” Fairey said. “Obama has had a really tough time, but there have been a lot of things that he’s compromised on that I never would have expected.”
In October 2010, a poll from Pew and National Journal surveyed the electorate as to how much the Congress had accomplished. This was the Congress that had passed the biggest fiscal stimulus in history, the Affordable Care Act, and the biggest financial reforms since the New Deal, among other things. Asked if the Congress had achieved more than other recent Congresses, just one-third of Democrats—Democrats—agreed, while 60 percent offered that the Congress had achieved the same as or less than other recent Congresses.
A wave of critics from the left cast Obama as helpless before the forces of reaction, or even complicit with them. Buyer’s Remorse, a 2016 book by the liberal cable television host Bill Press, flays Obama for selling out his supporters. (“Instead of recognizing their burning desire for strong progressive leadership, Obama tried to be a ‘post-partisan’ president.”) Thomas Frank’s Listen, Liberal, published that same year, arrived at the same conclusion, that Obama had merely continued a regime of economic dominance by the rich and powerful. Also that year, Democracy in Black, by Princeton African-American studies professor Eddie Glaude Jr., applied the critique to race. “Obama sold black America the snake oil of hope and change,” he argues. “The reality, amid the thick fog of unmet expectations, is that very little has changed in this country. In fact, things have gotten worse.” Bernie Sanders—who supplied a glowing testimonial for Press’s book—borrowed versions of this critique for his surprisingly popular campaign. Sanders told supporters it was “too late for establishment politics,” his term for the political style employed by Obama as well as Hillary Clinton, which Sanders and his supporters believed had accomplished pathetically little.
While Obama’s supporters may view him more sympathetically, they have tended to adopt an apologetic tone rather than a boastful one, blaming Republicans for his shortcomings rather than crediting his success. As the comedian Chris Rock put it in 2011, “I’m like everybody, I want more action.” In a 2015 Harper’s cover story assessing Obama’s legacy, headlined, “What Went Wrong,” Yale University professor David Bromwich noted that the Obama supporters he came across retreated quickly to the defense that his failure lay in factors out of his control. “Obama’s warmest defenders have insisted, against the weight of his own words, that such hopes were absurd and unreal—often giving as evidence some such conversation stopper as ‘this is a center-right country’ or ‘the American people are racist,’” Bromwich recorded. This defense of the president cast him as a sympathetic victim, rather than a figure of notable success. (The critics simply blamed Obama for his failures.) That his record was one of general failure constituted a generally accepted premise.
The yawning chasm between the scale of Obama’s achievements and the mood of his supporters presents one of the mysteries of the era. Its resolution also helps us understand how to judge the Obama presidency. What would a successful presidency even look like? Would Democrats recognize one if they saw it?
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In 1993, Bill Clinton, less than four months into his hopeful presidency, launched a blistering attack upon a villain hardly any Americans had ever contemplated: the private student loan industry. Clinton’s administration was looking at ways of making college more affordable, and lenders provided the most obvious target.
The student loan system was set up so that students who needed money for college would go to banks to borrow. Since the 1960s, the federal government had guaranteed the loans, so that if a student defaulted on her payments, Washington would pay it back. This managed to get a lot of tuition dollars into students’ hands, but it also created billions of dollars in profits for the banks, who were risking nothing: if a student made all their payments, the bank would make money on the deal, and if the student couldn’t make the payments, the federal government would lose. The profits were privatized, and the risk was socialized.
One of Clinton’s first proposals was to cut out the middlemen altogether. The largest single entity that profited off the operation was Sallie Mae, a privately owned bank whose business was supplied and underwritten by Washington, the purest incarnation of corporate welfare. If the federal government wanted to make college loans more affordable, Clinton concluded, it could simply lend the money itself. On May 11, the still-youthful president ventured to Fenton High School, in suburban Chicago, to denounce the vampiric industry in a populist flourish. “No sooner had I even mentioned changing this system than Congress was deluged with lobbyists,” Clinton told his audience. “The biggest organization, Sallie Mae, alone, that’s supposed to be in the business of helping you get money to go to college, has already hired seven of the most powerful lobbyists in Washington to try to stop this process from changing.”
The struggle dragged on for more than a year, ultimately ending in a compromise. Rather than completely killing off the college lending boondoggle, direct loans would get about half the market share of the loan program, with the banks getting the rest. Clinton had settled for half a loaf, but it was a major achievement, saving billions for taxpayers.
The saga of Clinton’s fight against the private lenders is worth a brief reconsideration here because it provides an example of what an ordinary, medium-sized political success looks like—or what it used to look like, before Obama’s rush of momentous accomplishments recalibrated the scale. The achievement was important enough that journalist Steven Waldman devoted a whole book, The Bill, to chronicling the drama, in which Clinton had taken on one of the most powerful and greediest lobbies in Washington, and fought it to a draw.
The episode is also worth a second glance because the story continued into the Obama years. Following their half defeat in 1994, the private lenders gradually gained the upper hand. The banks grabbed more and more of the market share, enlisting colleges to sign exclusive agreements that would funnel all their students in need of loans their way, shutting out Clinton’s direct-lending program despite the lower interest rates it could offer. “Direct lending has just become one lender among thousands, and it is still struggling to be relevant,” gloated one bank lobbyist. “Some five hundred colleges have stopped participating [with direct lending] because of shoddy management and financial losses,” jeered conservative activist Stephen Moore.
But it turned out something other than the magic of the free enterprise system accounted for the banks’ success in beating back their competition from Washington. In 2007, a major scandal came to light, exposing the systemic use of bribes to entice colleges to enlist their students with the banks. Lenders plied college loan officers with meals, cruises, and other gifts. Some of the loan officers accepted stock offers from the lenders to whom they supplied clients. Columbia’s director of undergraduate financial aid bought stock in Student Loan Xpress—which became one of that school’s preferred lenders—for $1 per share and sold it two years later for $10 per share. Some lenders offered millions to the universities to drop out of the direct-lending program. The Bush administration’s Department of Education failed to detect any of this widespread wrongdoing. One of its key officials assigned to oversee the program owned more than $100,000 in stock from one of the lenders he was supposed to be regulating.
Obama, following Clinton’s example, sought to eliminate the expensive and now demonstrably corrupt private lending program. His efforts languished in Congress. Republicans, nearly unanimous in opposition to every Obama proposal, denounced it in their usual florid terms. Republican senator Lamar Alexander, his party’s leader on education policy, called Obama’s plan “Soviet-style.” A handful of Democrats whose states contained major student lenders dragged their feet, complaining in a letter that eliminating the private loans could “could put jobs at risk.” (This was true, as far as it goes, but since any government program employs somebody, this logic would justify keeping even the most wasteful giveaway in place in order to protect jobs.) Pinned down on other fronts—trying to shepherd transformative legislation on health care and climate change while pulling the economy out of the economic crisis—Obama’s college lending reform languished in obscurity and appeared headed for a quiet demise.
But then the saga took an unexpected turn in March, at a time when Democrats in Congress had struggled to rouse health care reform from its deathbed via the budget reconciliation maneuver. Some of the changes the House demanded made subsidies for health care more generous, which cost the government more money. Congress’s rules require that a reconciliation bill reduce the budget deficit. Thus Democrats needed to find a way to offset those costs, or it couldn’t pass the reconciliation bill, which meant it couldn’t pass a health care bill.
There happened to be a big pot of savings sitting around: Obama’s direct-lending plan. The Congressional Budget Office estimated that direct lending would save the federal government $61 billion over a decade, just by cutting out the profits siphoned off by the middleman. Obama could plow some of those savings into lower rates for students and use the rest to reduce the deficit. And so, moving quickly in those frantic, desperate days, Congress simply added Obama’s college lending reform to the reconciliation bill that passed as part of health care reform. Since the measure was included in a bill that could not be filibustered, Congress could pass it with a majority vote, allowing for the defection of a handful of pro-bank Democrats.
The whole thing happened so quickly—and in the shadow of the biggest social policy reform in decades—that hardly anybody noticed. But there it was, a small add-on to the Affordable Care Act—technically, the law was called the Health Care and Education Reconciliation Act of 2010—that wiped out one of the most notorious giveaways in the federal budget in one fell swoop.
A reform of this scale may have earned a chapter in the history of an ordinary presidency. It amounted to a footnote in Obama’s. The full-scale switch to direct lending amounted to a major accomplishment of its own right, but also an episode that epitomized the gap between the imprint Obama has left on the federal government and the public’s awareness thereof. The administration’s domestic legacy has ranged far wider than acknowledged, in part because its major dramas overshadowed a number of smaller ones.
The theme binding together these reforms is that they undertook the politically difficult work of putting the government on the side of the public interest in the face of opposition from narrow interests that benefit from the status quo. An old political science truism holds that, on issues where the public pays little attention, small groups who care about the issue a great deal can shape the outcome to their favor, even at the expense of the broader good. In a number of unglamorous ways, some of them overlooked or even unnoticed, the Obama administration wrenched the weight of the government back toward the public interest.
Much of this work is the bread-and-butter of a Democratic presidential administration: judicial appointments, administrative reforms, medium-sized legislation. An incomplete list* would include directing the Federal Communications Commission to require Net neutrality (which prohibits broadband providers from controlling Internet content); An end to the ban on openly gay military service; A doubling of the income limit of workers automatically eligible for overtime pay; a crackdown on abusive for-profit colleges; legislation banning hidden credit card fees and deceptive practices; the most aggressively pro-labor redefinition of workers’ rights in four decades thanks to his appointees to the National Labor Relations Board; and a revamp of immigration enforcement, to emphasize dangerous criminals over unauthorized migrants. Many of these reforms required acrimonious fights in Congress and aroused deep opposition from lobbyists. They fleshed out Obama’s promise to restore balance to a government that had come to operate on behalf of wealthy and self-interested insiders. And then there were two other major fights that rose well above the ordinary policy grind, and reshaped the face of major institutions in American life: public education and the financial industry.
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In July 2010, Obama appeared at the Washington Convention Center to speak before the National Urban League. In that speech, which came after the stimulus, after the bank restructuring plan, and after health care reform, the president revealed what he saw as his administration’s most significant achievement. “Now, over the past 18 months, the single most important thing we’ve done,” he announced, “. . . is to launch an initiative called ‘Race to the Top.’”
That Race to the Top amounted to Obama’s most important measure is a hard case to make, and it’s impossible to know if he actually believed it, or merely wanted to use hyperbole to draw attention to an overlooked accomplishment. But, of all the things Obama’s administration has done, Race to the Top—a pot of money the administration used to lure states to reform their schools—is surely the one with the largest gap between perception and reality. It happened suddenly, with little buildup, and made barely a ripple in the national debate. The impact will take years to properly understand, but it has clearly been profound.
Education is an issue that national candidates have always talked about a lot because voters care about it a lot, and because education is the most essential mechanism for training future citizens and workers. But it’s not an issue they’ve done a great deal about, because education is overwhelmingly financed and directed by state and local governments. And this atomization is itself a problem: it has produced huge inequalities between rich and poor states and, especially, rich and poor districts; and it has discouraged innovation, because there is little means to track and measure different approaches within such an atomized system. Most schools simply muddle through doing things more or less as they have always been done. The imbalance between the scale of the educational system’s importance to the nation’s social and economic future, and the political system’s ability to direct it, has frustrated generations of presidents of both parties.
Experts in health care and tax policy and the like have spent decades studying and refining proposals. In education, experts are trying to figure out what works. Much of the job of reform is focused not on imposing worked-out solutions, but on creating the conditions that would allow those solutions to be discovered, and then replicated. In the years leading right up to Obama’s election there was great excitement centered on findings about teacher impact, which varies enormously, not merely from district to district but within schools. Research has found that the best teachers can teach their average student a grade and a half’s worth of material, while the least effective teachers can advance their students about half a year’s worth. Much of the education reform movement has therefore concentrated its energies on finding ways to increase the supply of the most effective teachers, and either train up or allow principals to replace the least effective ones.
This effort placed education reformers onto treacherous ground with many members of the teachers’ unions. The union movement has historically protected teachers from the abusive labor conditions they faced in the early parts of the twentieth century. But its protections have also treated teachers as a mass of undifferentiated, replaceable parts. Union contracts require that teachers be paid according to their length of service, with little possibility of rewarding excellent performance, and make it difficult or impossible to fire teachers except in the cases of the most gross negligence (and in some cases, not even then). Those contracts have thus made it impossible to do the thing teacher-effectiveness research considers most necessary: make a practical distinction between individual teachers based on their performance. Expressing the solidarity that is the core spirit of the labor movement, unions tended to treat any criticism of the least effective teachers as an attack on all teachers. The resulting dynamic—unions and the reform movement coming to view each other with a distrust that blossomed into outright loathing—has had the curious effect of making Democratic supporters of education reform unusually reticent about their beliefs. Why alienate a group that includes some of their staunchest supporters and most dedicated campaign volunteers?
And so Obama has carried out his education agenda with a lack of fanfare bordering on secrecy. Back in 2006, then a freshman senator, he introduced the Innovation Districts for School Improvement Act. Rather than handing grants to all the school districts, or to some select group determined in advance, the act would use the grant money as a prize, rewarding districts that establish data systems to track student progress and create more flexible contracts that allow principals greater autonomy to reward, retrain, or dismiss a given teacher’s performance. With a Congress controlled by pro-union Democrats, and a White House still occupied by an anti-domestic-spending Republican, Obama’s bill had no chance to pass, but his sponsorship of the bill indicates the importance he placed on education reform from the outset of his time on the national stage.
After starting his presidential campaign, Obama took a much more taciturn approach to education policy, to the point where neither pro-reform Democrats nor pro-union Democrats knew which camp he would favor once in office. The answer came quickly and quietly. In the course of crafting the stimulus, Obama inserted a $4.3 billion grant modeled after the bill he had proposed as a senator. The funds would serve as reward money for a nationwide contest, this time measured state by state. Any state that chose to enter would submit a plan explaining how it planned to overhaul its educational policy. The applications, called “Race to the Top,” would be judged along four criteria: adopting rigorous standards and assessments; recruiting, evaluating, and retaining effective teachers; building data systems to measure learning; and turning around low-performing schools.
Many Democrats allied with the unions would ordinarily oppose any major reform initiative. Indeed, David Obey, chairman of the House Appropriations Committee, scoffed at Obama’s proposal. But it was thrown into an emergency bill that Democrats dared not kill or even delay, at the peak of Obama’s political honeymoon. It also mollified its critics by coming alongside a much larger $100 billion grant to prevent states, whose budgets had collapsed in the wake of the recession, from laying off teachers. There was only one brief moment when a sweeping education reform could have passed; the Obama administration seized it. In the years that followed, Race to the Top and the wave of experimentation it unleashed became the subject of bitter acrimony from teachers’ unions. It would soon be hard to imagine how it passed so quickly and uncontroversially. Indeed, Race to the Top is the one policy where the Republican accusation of government by stealth—passing a major policy change without extensive review or debate—rings true: the reform was tucked into a massive emergency bill with little debate. The grants received hardly any public attention before Obama signed the stimulus. The phrase “Race to the Top” did not appear in the New York Times in conjunction with the program until four days after Obama signed it into law.
Structuring the program as competitive grants was an ingenious way around the problem of local control, which had long stymied educational reform. Obama was not imposing regulations upon districts, or even states. No state had to enter the contest if it didn’t want to. And since states had to vouchsafe their plans to reform their schools in order to enter the contest, the prize money had an impact vastly out of proportion to its cost. More states would enter the contest (and impose reform programs as their entry requirement) than would win. The relatively small amount of prize money, some one-half of one percent of the stimulus, would leverage reform on a sweeping scale. All in all, thirty-four states overhauled their education policy in response to the contest. Education secretary Arne Duncan warned that states that did not allow, or artificially capped, public charter schools would put their application for funds at risk.
“The contest for the stimulus money,” wrote Steven Brill in Class Warfare, a history of the school reform fight, “became a call to arms for a snowballing network of education reforms across the country—an unlikely army of non-traditional urban school chiefs, charter school leaders, researchers at think-tanks who were producing data about how teaching counted more than anything else, philanthropists and hedge-fund billionaires who ate up the data, fed-up parents, and a growing corps of unconventional Democratic politicians.” Washington, D.C., schools chancellor Michelle Rhee won a breakthrough new contract, raising teachers’ annual average base pay by $14,000, providing an additional $20,000–30,000 in annual performance bonuses to the most successful of them, as well as allowing principals to replace ineffective teachers (without effectively guaranteeing them a teaching job somewhere, as was the case under the old contract). In New York, the state legislature, which had resisted unsettling the status quo, was forced to lift New York City’s cap on charter schools—some of which had produced extraordinary gains in its poorest neighborhoods. New York schools chancellor Joel Klein told Brill, “This is a bend in history’s arc, caused by the Race.”
In 2015, William Howell of the University of Chicago measured the impact of Race to the Top and found it had been a transformative one. Starting with a list of thirty-three different reform policies (like measuring teacher effectiveness and allowing charter schools) he found that, in the seven years before Race to the Top, states enacted just 10 percent of them. From 2009 to 2014, they enacted 68 percent of them. Howell found that even states that did not win grants had dramatically increased their adoption of reforms, a measure of how effectively the program leveraged a small amount of funding into sweeping change. “The surge of post-2009 policy activity constitutes a major accomplishment for the Obama administration,” concluded Howell. “With a relatively small amount of money, little formal constitutional authority in education, and without the power to unilaterally impose his will upon state governments, President Obama managed to jump-start policy processes that had languished for years in state governments around the country.”
After the funding for Race to the Top expired, the administration discovered another way to encourage reform—this time without spending any money at all. In 2001, the Bush administration had signed an education law called “No Child Left Behind,” which called for every student in America to reach a defined level of academic proficiency. The goals were aspirational rather than realistic, and the measurements quite blunt: they relied entirely on test results, holding every district to the same standard. Obama-era education reforms used test results to account for no more than half the criteria for measuring teachers, and the tests were calibrated to students’ baseline level, so that schools could be deemed successful for enticing improvement out of low-achieving students in areas of high poverty. In fact, the administration used waivers from No Child Left Behind’s harsh punishments the way it used Race to the Top bonus funds—as an incentive to coax states to implement better systems for measuring and rewarding effective schools and teachers.
The administration’s encouragement to the reform movement scrambled the normal trench lines in ways that none of the participants knew fully how to handle. Just as Obama was hesitant to alienate a core constituency, union leaders refrained from directly attacking a president who retained high general popularity with their members. Instead they directed their ire at Secretary Duncan, as though he were some rogue agent implementing a radical agenda of school reform behind the president’s back. Many Republicans who had sympathy with the reform movement were too invested in all-out opposition to Obama to complicate their line of attack by praising his education policies. In many states, teachers’ unions wound up donating to Republican candidates. Neither the unions nor the Republicans have had much interest in publicizing the strange-bedfellows alliance, but it makes a certain sense. The traditional conservative Republican educational prescription emphasizes local control. Allowing schools to stay the course, unmolested by central authorities, conveniently allows the unions to maintain their traditional influence. “President Obama and other liberals still cling to the belief that, despite nearly half a century of failure, Washington can ‘fix’ education,” scoffed Lindsey Burke, an analyst for the Heritage Foundation. Pro-union liberals have attacked education reform from a slightly different premise, insisting that educational progress is possible, but only if the root causes of poverty are solved first. The left-wing Nation editorialized, “[E]ducation policy must be devised in concert with health reform, poverty alleviation initiatives and economic development in order to address the roots of failure in the most depressed areas.” (Of course, Obama’s program has also done a great deal for health care, poverty alleviation, and economic development.) Coming from opposite ends, the left-wing and right-wing critiques of the reform movement share a fatalistic premise, convinced that more effective methods of education cannot be designed, tested, and spread.
But reasons for optimism abound. The education reform movement is still in the early stages, but charter school attendance grew rapidly, and some charter schools have shown the possibility for spectacular results. Charter schools, unlike private schools, cannot select their student body; they must take all comers, and if applications outstrip openings, as often happens, admit students by random lottery. Programs like the Success Academy and the KIPP schools have yielded spectacular academic gains among low-income students. A landmark 2015 study by Stanford’s Center for Research on Education Outcomes carefully compared urban students in charter schools with students who had similar characteristics (family income, percentage of English language learners, and special education students) who attended traditional neighborhood-based schools. The charter students outperformed their similar peers by an average of 40 additional learning days a year in math, and 28 additional learning days in reading. No single model for education had been discovered, and definitive evaluation of student performance takes years to track, since the end goal is to help those students find career and life success. But an era of stagnation had given way to one of ferment, experimentation, and progress.
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While almost nobody saw the financial meltdown coming, in retrospect it was a virtual inevitability. Huge segments of finance had moved into new, lightly regulated investment vehicles that used complex structures to bury massive risks. Much of the industry’s investments required housing prices to stay afloat in perpetuity. The housing market had formed a bubble, as many analysts saw at the time, but no regulators had the primary task of protecting consumers from the subprime loans that banks were shoveling out the door. When the housing bubble popped, huge segments of Wall Street collapsed, as though the foundations beneath it had disintegrated.
As the financial crisis gave way to a bailout and then a recession, the public’s mind ran toward punishment as recourse—Americans had suffered, and somebody had to pay. That punitive impulse hurt Obama badly in 2009 when he had to make the case for fiscal stimulus, when the public believed, despite the conclusions of most economists, that the government had to cut its spending. But in 2010 the president set out to reform the financial sector, and here the still-simmering anger worked in his favor.
Reforming finance was never going to be a politically simple matter. When financial irresponsibility has not triggered an economic meltdown, ordinary people care little about financial regulatory policy. Even during economic convulsions, the vast majority of those who pay close attention to the issue are those with substantial money at stake, and they mostly want regulators to leave them alone. The previous major wave of regulation of the heart of the financial industry had occurred decades before Obama was born, during the Great Depression, amid the last bout of ferocious public anger at Wall Street.
What’s more, most of the industry delusionally viewed itself as the victim of bad luck, rather than its own misdeeds. Even the cataclysmic collapse of the world economy could not budge the titans of finance from thinking of themselves as the great and deservedly rewarded minds driving American prosperity. All the more so because of this wild ego inflation, the public backlash against their misbehavior frightened them, the angry crowd seen as a homicidal collective subjecting innocent Wall Street to irrational bloodlust And so, while much of the industry accepted the inevitability of some reregulation, it hardly rolled over, instead rallying Republicans to oppose the bill from the outside, and lobbying moderate Democrats from the inside.
The result of this push-and-pull between populist anger and the lobbyists’ mastery of the Washington game was the most significant financial regulatory reform in three-quarters of a century. The summer 2010 legislation, named after its major cosponsors, Connecticut senator Chris Dodd and Massachusetts’s Barney Frank, lacks the poetic elegance of a simple, silver-bullet solution. Instead it imposed a wide array of complicated reforms:
It created new exchanges where swaps—a kind of investment that trades expected cash flows from one thing for cash flows from another—must be traded. The exchanges brought out into the open a vast realm of activity that had been conducted privately. Forcing the prices out into the open already cut the banks’ revenues on this business by more than a third by 2014—reflecting a reduced opportunity to make money on the basis of inside information.
It imposed the “Volcker Rule,” which separated out proprietary trading—another high-risk form of investment—from normal banking. The rule had been proposed by former Federal Reserve chairman Paul Volcker, against fierce industry opposition, in order to limit chances for bad investments to contaminate the safer kind. When the rule first passed in its sketched-out form, nearly everybody expected the industry to shoot it full of loopholes. Instead it survived in strong form: Goldman Sachs, Bank of America, Morgan Stanley, and Citigroup all shut down their departments that had invested the firm’s money in risky outside ventures. Concluded business writer Kevin Roose in New York magazine in 2013, “That’s exactly what was supposed to happen—a transfer of risk away from too-big-to-fail, FDIC-backed banks to parts of the industry that could absorb losses more cleanly.”
It created a new agency, the Consumer Financial Protection Bureau. Initially dreamed up by Elizabeth Warren, then a Harvard professor, the bureau filled a yawning gap in the architecture of the regulatory state: it would police banks to ensure they did not exploit their customers—a chronic problem in a product whose complexity made even the economically sophisticated vulnerable to fine print and hidden charges. Republicans fought the agency’s creation desperately, even refusing to confirm any director at all unless Obama would agree to severely curtail its powers. (The administration eventually installed a director, Rich Cordray, after Senate Democrats threatened to eliminate the filibuster rule entirely, forcing Republicans to relent.) The agency has performed as its advocates hoped—cracking down on billions of dollars of scams by mortgage lenders and banks. It created national regulations on payday lenders, which furnish short-term, high-interest loans to strapped low-income customers, many of whom used to wind up paying ruinously high interest rates. It authorized the Securities and Exchange Commission to require stockbrokers and portfolio managers to follow their customers’ “fiduciary interest”—which is a technical way of saying their advice has to be designed in the best interest of the customer. (That may sound obvious, but brokers have often unloaded what they know to be bad stocks onto their clients in order to make money for their firm.) And it allowed customers to file class-action lawsuits against financial firms for misconduct. (Technically, the right to sue existed before, but financial firms inserted language into contracts signing away that right, leading to case after case of financial fraud for which customers had no recourse. With a stroke of a pen, the agency shifted billions of dollars from large banks to ordinary savers.) These pro-consumer reforms have enraged the Wall Street lobby.
Perhaps most important, and certainly most controversial, the law created a mechanism to prevent a future dilemma where a huge firm required a bailout in order to prevent its losses from melting down the entire economy. Firms labeled “systemically important”—that is, so big that their failure would threaten the entire system—had to keep higher levels of capital to ensure against their losses. And the government now had the authority, which it lacked in 2008, to take those firms over, rather than just write them a giant check. That meant that if a firm had to be taken over, the shareholders would lose everything—an incentive that encourages these firms not to take excessive risks.
Republican critics of the Dodd-Frank law fixated on this last provision as the center of their attacks, but the debate over financial reform placed them in a perilous spot. They opposed reform, in keeping with their opposition to bigger government in general and anything Obama wanted in particular. Opposing reform also gave Republicans access to the largest source of campaign donations—after giving somewhat more to Democrats in 2008, the financial industry lurched overwhelmingly toward the Republican Party after Obama took office. Boehner called the bill “killing an ant with a nuclear weapon”—an overreaction to a relatively minor problem. Jeb Hensarling, the ranking Republican on the House Financial Services Committee, said that his party’s “answer” was “more vigorous enforcement of our existing fraud and consumer protection laws” and “to end taxpayer bailouts.” The Republicans opposed new regulations on the finance industry. They instead proposed supposedly stronger enforcement of existing rules (despite their long-standing efforts to starve the SEC’s enforcement budget) and refusing to bail out any companies in the future (an appealing position to take, until a firm is actually about to collapse and drag the rest of the economy down with it).
But opposing reform did not sit well with the public. Republican message consultant Frank Luntz explained in a memo to fellow members of his party that, given the state of public opinion, “the status quo is not an option.” Rather than position themselves as advocates of deregulation, Luntz advised Republicans to label the reforms a “Big Bailout Bill,” and to argue, “The legislation is filled with lobbyist loopholes that exclude certain wealthy, powerful industries from regulations.” The legislation did not create bailouts—it ensured that firms whose failure could trigger a broader collapse would bear the brunt of their own failure, rather than offloading the cost onto taxpayers. The disingenuous argument meant that putatively anti-business Republicans echoed the same themes of completely earnest critics from Obama’s left, who feared that he had given up a once-in-a-lifetime chance to cut Wall Street down to size. And since the legislation was so fiendishly complex, and the industry’s scheming so fresh in the public mind, the most cynical interpretations of the law became the most plausible ones. Wall Street, it was proclaimed, had secretly prevailed—or it would when the fine print was written behind closed doors. It was easy to believe that the industry had outwitted (or co-opted) its would-be regulators, and difficult to believe that Washington had imposed fundamental change upon it against its will.
Yet, in the years since the law’s passage, a mounting body of evidence has proved that this very thing happened. Opponents of the bill charged that firms deemed systemically important under Dodd-Frank—that is, too big to fail—were receiving special treatment from the government. As the influential liberal financial journalist Mike Konczal found, the opposite proved to be the case. Firms lobbied Washington not to be designated systemically important—the costs of the new requirements the law imposed on too-big-to-fail firms exceeded any benefit. What’s more, the Government Accountability Office found that Dodd-Frank had eliminated a major advantage big banks had previously enjoyed. Before the law passed, the biggest firms were perceived by lenders as safer bets, since it was reasonable to expect they would be bailed out in the event of a collapse. They were thus able to borrow money at lower rates than smaller firms (whom investors expected the government would let die). After Dodd-Frank’s passage, the difference in interest rates disappeared. Dodd-Frank was not helping the biggest firms, as the cynics suggested.
The law has not turned Wall Street into a barren wasteland, but it altered the landscape profoundly. “Four years after the Dodd-Frank financial law became reality, Washington’s regulatory machine is altering Wall Street in fundamental ways,” the news pages of the Wall Street Journal concluded. “Banks are selling off profitable business lines, pulling back from the short-term funding market, cutting ties with businesses that could attract extra regulatory scrutiny, and building up defenses to help weather future crises. While profits are up as firms slash costs and reduce funds set aside to cover future losses, their traditional profit engine—trading—is showing signs of weakening as banks step away from some activity amid regulatory pressure.” Just as the law’s authors hoped, banks were focusing on banking, and abandoning high-risk investments.
Liberal policy wonks steeped in the regulatory debate have reached the same conclusion. “There is no question that many of the highest-risk activities, which happened to be the most profitable activities for Wall Street, are now at least reduced and often totally gone,” Dennis Kelleher, chief executive of Better Markets, a progressive organization advocating tighter restrictions on finance, told Politico’s Ben White. “They’ve had to exit hedge funds and private equity funds and they sold off any business with ‘proprietary trading’ on the door.” The industry has recovered from the depths of the financial crisis, but at a far more modest trajectory. Finance accounted for 10 percent of new jobs in New York City during the go-go 1990s recovery. As of 2015, it accounted for less than 1 percent. In 2015, some financial institutions simply sold off their massive banking operations. Before the financial crisis, financial firms accounted for a staggering 30 percent of all corporate profits in the United States. By 2015, that share had fallen to 17 percent. The financial industry, swollen beyond any reasonable scale, has been cut down to size.
The new Republican administration came into office vowing to repeal the Dodd-Frank reforms. Indeed, the shocking news of Trump’s victory caused major Wall Street stocks to soar 9–10% immediately, on the belief these firms would receive more lax regulation. But Obama’s array of financial regulations represent one aspect of his legacy that Trump and his Republican allies had little capacity to destroy. They could use a budget reconciliation bill to make changes exclusively related to taxes and spending. (They could use such a bill to zero out the subsidies needed to make Obamacare affordable, for instance.) But to wipe Dodd-Frank off the books would require them to gain the sixty votes needed to overcome a filibuster, a nearly impossible task in a Senate with forty-eight Democrats, or to abolish the filibuster permanently, a move many Republicans oppose (and which would require fifty of them to carry out).
The Trump administration can, and almost certainly will, refuse to enforce the law as intended. But this is the standard approach by a Republican presidency toward regulations they don’t approve of but lack the votes to overturn. Republican administrations inevitably refuse to enforce labor law, environmental regulations, workplace protections, and so on. Dodd-Frank will fall into the same category. And when a Democrat (or perhaps a moderate Republican in a chastened future party) returns to 1600 Pennsylvania Avenue, without having to wait or hope for congressional approval, the legacy of these reforms will be renewed.
In the wake of the crisis, progressives dreamed of repeating Franklin Roosevelt’s epic leveling of Wall Street’s power. For decades after the New Deal, finance was a boring profession, until it emerged in the 1980s as a center of staggering wealth and risk. Obama’s reforms have not restored Wall Street to the way it was, when Gordon Gekko was an unimaginable character. They did land a powerful blow against out-of-control finance, whose impact will be felt far into the future. “Most of the industry was violently opposed to the new rules,” political scientist J. Nicholas Ziegler, who studied the law’s passage, told financial reporter James Surowiecki. “But a combination of small but very engaged advocacy groups and gutsy regulators made sure they got through.” Government worked. The good guys won.
* * *
In August 2011, the liberal author and psychology professor Drew Westen wrote a New York Times essay explaining what, for many liberals, was already a self-evident truism: that the Obama administration had failed. Rather than bending the arc of history toward justice, observed Westen, the president “has broken that arc and has likely bent it backward for at least a generation.” Westen blamed Obama’s failure on his centrist instincts, and mourned that his refusal to lead the public allowed the Republican rhetorical fixation with deficits to dominate the political agenda instead. “Had the president chosen to bend the arc of history,” Westen lamented, “he would have told the public the story of the destruction wrought by the dismantling of the New Deal regulations that had protected them for more than half a century.”
Around the same time, New York Times columnist Thomas Friedman expressed his displeasure with Obama in roughly the opposite terms. Friedman touted the possibility of a third-party movement, called Americans Elect. The main peculiarity of Friedman’s argument was the triviality of his substantive disagreement with the administration. On virtually every issue, Obama was supporting policies Friedman demanded: short-term stimulus, long-term deficit reduction through a mix of taxes and entitlement cuts, clean energy, education reform, and social liberalism. Where Westen flayed Obama for his willingness to compromise with Republicans on a long-term deficit agreement, Friedman heartily agreed with it. He advocated for a third-party candidate anyway, because such a figure, he wrote, “would have offered a grand bargain on the deficit two years ago, not on the eve of a Treasury default.” He agreed with Obama’s plan, in other words, but argued for a new party because he disagreed with his legislative sequencing.
When we see such a disconnect between the depth of the grievances against Obama and the shallowness of their substance, we have to conclude that some other dynamic is at work. Whatever economic policy errors Obama made do not suffice to explain the depth of the reaction he engendered. The liberal dissatisfaction with Obama tells us more about the liberals than it does about Obama.
One premise held in common by critics from Obama’s left, like Westen, and critics from Obama’s right, like Friedman, is that the president has the sole responsibility for policy outcomes at the federal level. The “Westens” demand that he use his rhetoric to summon a populist wave that overpowers the resistance of Republican opponents, and the “Friedmans” demand that he use his negotiating skills to lure them into compromising away their theological opposition to higher taxes. Despite their differing goals, they share a belief that Obama has within him the power to impose his will upon the legislative branch.
Passing a law requires the agreement of the House and Senate along with the president—a fact known to high school civics class students, but often forgotten by political commentators. Popular culture shares the same bias for viewing all political stories through the lens of presidential drama. (Aaron Sorkin’s film The American President and his acclaimed series The West Wing both imagined Washington as a fantasy realm revolving around the president, who was capable of crafting a speech so compelling that, with the aid of a well-chosen background score, it could transform the landscape instantaneously.)
But Congress does not view itself as a mere appendage to the presidency. Members of the legislative branch have interests that often diverge from the president’s, not to mention healthy egos. Congressional diffidence grows out of a tradition peculiar to American history. Unlike the parliamentary systems found in most other democracies, where the majority is elected on a unified platform, the separated powers in a presidential system establish the legislature and the executive as coequal branches. During the twentieth century, the Republican Party had strong moderate and even progressive northern wings to balance its conservatives, while the Democrats had a large, conservative white southern wing to balance its liberals. Defections across partisan lines occurred with natural frequency. After the civil rights movement drove white conservatives out of the Democratic Party, the two coalitions gradually sorted themselves into cohesive blocs. But the old barons of Congress, reared in an age when Lyndon Johnson might rely heavily on northern Republicans to pass civil rights laws, or scores of Democrats would support Ronald Reagan’s budget, clung to their habits.
Even during its initial, two-year period of Democratic control, Congress ostentatiously (and nearly immediately) announced its independence from the new president. Shortly after Obama took office, Senate majority leader Harry Reid stated, “I don’t work for him.” Even House Ways and Means chairman Charlie Rangel, whose Harlem constituents danced in the streets after Obama’s election, sniffed at Obama’s plan to raise taxes on the rich, “I have to study it but I really don’t take president’s recommendations that seriously.” “Recommendation” is a pregnant term, indicating the conviction by the baron of the House Ways and Means Committee that a president might submit a suggestion, as any adviser might, but the job of crafting laws belongs to him. Some welcome mat.
While the Democratic Party has grown more ideologically homogeneous during the twenty-first century, it has retained divisions, especially in its economic base. Unlike European socialist parties, which can rely solely on the power of labor, the Democratic Party requires significant support from business along with groups that sometimes feud with business, like unions, environmentalists, and consumer groups. That often-ungainly coalition can serve as an advantage, allowing Democrats to take into account a wide scope of economic interests. On the other hand, the Republican Party’s more uniform economic base, consisting of businesses and wealthy individuals with no labor or environmental support to speak of, inevitably produces policies favoring a narrow sliver of the population. But the uniformity helps Republicans in Congress pull together.
The Democrats’ economic divisions were on clear display from the outset. Just a month after Obama took the oath of office, North Dakota Democrat Kent Conrad, then the Democratic chairman of the Senate Budget Committee, gave an interview expressing deep reservations about the president’s budget proposals. Conrad said that he objected to a provision to limit tax deductions for high-income earners. He likewise opposed Obama’s plan to limit subsidies to farmers who earn $500,000 per year. Conrad insisted his main objection to Obama’s plan was that it failed to reduce the long-term deficit deeply enough, notwithstanding his own opposition to these two Obama deficit reduction proposals. Nebraska senator Ben Nelson gainsaid Obama’s plan to reform college lending by cutting out payments to private lenders. All politics are local: North Dakota has lots of farmers, and one of the most lucrative private college lenders had its headquarters in Lincoln, Nebraska. And so it went down a good portion of the line, short-term constituent or donor concerns trumping greater support for the president of their own party.
The influence of business over the party agenda is a problem no Democratic president has ever fully escaped. There is no evidence that Obama has ever shared left-wing goals like eviscerating the financial industry or soaking the rich with punitive taxes, but even if he secretly desired those ends, the economic makeup of his party base would prevent it. As noted earlier, Obama did proclaim his support for a health care reform that included a “public option”—a government-run plan that would compete head-to-head against private insurers on the exchanges he would create. The insurance industry, which went along with health care reform only grudgingly (and even financed attack ads against the law at times), deemed a public option completely unacceptable. Several Democrats in the Senate with close ties to the insurance industry made elimination of the public option a condition of their support for reform.
Most liberal health care experts considered the public option a helpful feature, but not a crucial one—if properly designed, the public option would give consumers more options and increase pressure on insurers to hold down prices. Indeed, political scientist Jacob Hacker, who designed the public option, endorsed the Senate bill even after it was stripped out.
For many liberal activists, however, the public option’s absence doomed health care reform. “If Barack Obama’s health care plan gets changed to exclude a public option like Medicare, then it is not health care reform,” insisted Howard Dean. “Legislation rises and falls on whether the American public is allowed to choose a universally available public option or not.” (It’s worth recalling that Dean’s own health care plan in his 2004 presidential campaign did not include a public option.)
The saga of the public plan revealed elements of the congenital liberal failure to accept some of the normal features of legislative give-and-take. There was the habit of imputing all outcomes to the president personally. The Huffington Post’s Dan Froomkin, for instance, insisted in 2009 that Obama either “will come out with a strong bill” or “will come out of it having given away the store.” The choice would reflect on the president’s character. “Is the real Obama being serially co-opted by his aides in there? Or is the real Obama at heart a conflict-averse facilitator, rather than a leader?” he asked, neglecting to even consider the possibility that Congress might have limited his options.
Liberals are correct in their belief that business interests often sit in tension with liberal goals. But some of the opposition to Obama embraced a more extreme assumption that business interests are completely incompatible with the public interest. That more radical belief animated some of the left-wing opposition to Obama. Widely read bloggers like Markos Moulitsas and Marcy Wheeler, not to mention Keith Olbermann, the then-influential MSNBC talk show host, denounced bills in Congress as a bailout for the health insurance industry. The sometimes pernicious influence of business upon the Obama agenda produced spasms of rage that did not arise out of any considered public philosophy of the left. It is true that increasing access to private health insurance benefits the insurance industry, just as increasing access to food benefits the agriculture industry and building more infrastructure benefits the construction industry. Opposing health care reform solely to deny customers to the insurance industry made no sense from a liberal standpoint, or even a socialist standpoint. Instead, it reflected a kind of infantile rejection of the compromises inherent in governing. The historian Arthur Schlesinger Jr., writing in 1949, assailed liberal idealists who were abandoning Truman for the millennial promises of Henry Wallace and his Progressive Party. Schlesinger defined this impulse as a “fear . . . of making concrete decisions and being held to account for concrete consequences.” The attraction of protesting the status quo might lure liberals, but the realities of exercising power would invariably repulse them.
This reflexive disgust with governing arose not only on the left of the Democratic Party but also at its center. Marshall Ganz, the liberal grassroots organizer, lamented in the Los Angeles Times in 2010, “Abandoning the ‘transformational’ model of his presidential campaign, Obama has tried to govern as a ‘transactional’ leader.” Jon Stewart put it in even more anguished terms, expressing his disappointment that politics itself did not change under Obama: “He ran on this idea that the system and the methodology are corrupt. It felt like the country was upset enough that he had the momentum needed to reevaluate how business is done. Instead, when he got elected, he acted as though the system is so entrenched that it has to be managed.” (Note that this complaint was diametrical to the complaint that Obama was too aloof from the practical horse-trading to have success in Congress, in supposed contrast to the legendary wheeler-dealer Lyndon Johnson, for whom many of Obama’s liberal critics pined.)
This is a deep-rooted feature of the liberal style of politics. It expresses itself as a persistent desire to improve not just policy but politics itself. Since conservatives are focused only on dismantling the domestic functions of government, the great movements to reform politics have all come from the left. Progressivism developed a century ago out of a desire to cleanse politics of bosses and transactionalism. Some liberals attribute their disappointment in Obama to the excessive hopes he raised about representing better, cleaner, more uplifting politics. But the euphoria surrounding Obama’s election, while it exceeded that of previous presidents, was hardly a completely unique phenomenon. Bill Clinton was the Man from Hope, touring the country with Al Gore and promising the renewing spirit of a younger generation. Jimmy Carter frequently pledged, “I will never lie to you,” and moved the 1976 Democratic convention hall to tears. Liberals found the experience of Barack Obama’s presidency mostly dissatisfying because they find power itself discomfiting. They can be happy with the idea of a Democratic president—indeed, dancing-in-the-streets delirious—but not with the real thing. The various theories of disconsolate liberals all suffer from a failure to compare Obama with any plausible baseline. Instead they compare Obama with an imaginary president—either an imaginary Obama or a fantasy version of a past president.
* * *
Back in February 2008, during the heat of the Democratic primary contest between Obama and Hillary Clinton, machinist union president Tom Buffenbarger had unleashed a rip-roaring endorsement of Clinton combined with an even rip-roaring-er assault on her young opponent. “I’ve got news for all the latte-drinking, Prius-driving, Birkenstock-wearing, trust fund babies crowding in to hear him speak!” he’d shouted. “This guy won’t last a round against the Republican attack machine. He’s a poet, not a fighter.”
By 2011, with Obama in the depths of his debt ceiling ransom debacle, members of his party began to recall Buffenbarger’s indictment as prophetic. Olbermann replayed the clip from three and a half years earlier on his MSNBC program, calling the union leader “Nostradamus.” By then a broader “buyers’ remorse” had set in among the party faithful. They had nominated the wrong candidate, saddling themselves with a weakling helpless in the face of Republican attacks. HBO’s Bill Maher professed Hillary Clinton would have been a better president because “[s]he knows how to deal with difficult men.”
Often the viewpoint resorted to scatological explanations. The former Clinton White House adviser James Carville told reporters, “If Hillary gave up one of her balls and gave it to Obama, he’d have two.” Matthew Dickinson, a presidential scholar at Middlebury College, was slightly more subtle when he wrote in Salon, “If I heard it once this past week, I heard it a thousand times: You were duped by Obama’s rhetoric—the whole ‘hopey-changey’ thing. . . . It’s time to elect someone who can play hardball, who understands how to be ruthless, who will be a real . . . uh . . . tough negotiator in office.”
The newfound appreciation for Hillary Clinton’s persona as hero of the working class drew upon memories of rapid economic growth during the Bill Clinton administration, fused them with Hillary’s beer-chugging outreach to white working-class Democrats, and produced a powerful mythos of the Clintons as butt-kicking heroes of the people.
The retrospective embrace of the Clintons helped underscore how deep the liberal tendency runs to idealize the past in contrast with the present. Indeed, the chief political adviser for Hillary Clinton’s 2008 campaign, Mark Penn, wrote periodic columns throughout Obama’s presidency urging Obama to give up on health care reform, make nice to businesses, and stop taxing the rich. And recall what happened when the Clinton administration proposed an economic stimulus shortly after taking office. Bill Clinton had campaigned promising a stimulus bill to alleviate widespread economic pain, with unemployment at 7.5 percent at the start of his term. Like Obama, Clinton needed a handful of Republican senators to pass it (Obama needed two Republican votes to break a filibuster, Clinton three). Clinton’s proposed stimulus was $19.5 billion. Unable to break a Republican filibuster, Clinton offered to pare it down to $15.4 billion. Republicans killed it anyway, creating an image of a Clinton administration in disarray.
Certainly, the circumstances faced by Clinton were different. (For one thing, the recession was far less deep and passed its worst point shortly after he took office, making the case for stimulus less urgent.) Still, nothing in this episode suggests Clinton possessed any special communicative or legislative skill that would have enabled him or his wife, had either held office in 2009, to pass a larger stimulus than the $787 billion bill Obama signed.
Certainly Bill Clinton’s election, following a dozen years of Republican presidencies, ushered in buoyant hopes of renewal. But liberals experienced his presidency as immediate and almost continuous deflation and cynicism. Clinton did enjoy one major triumph in his first year, when he passed a budget bill that raised the top tax rate, expanded the Earned Income Tax Credit, created a new national-service program for graduates, and reformed other parts of the budget. This was the progressive apogee of the Clinton administration. Liberals at the time viewed it as a sad half measure. Its focus lay on deficit reduction, not public investment, and each iteration of the legislation that worked its way through the congressional machinery emerged less inspiring than the last. “The Senate’s machinations on President Clinton’s budget plan have left many Democratic House members feeling angry and betrayed,” noted a New York Times editorial.
The rest of Clinton’s first two years consisted of a demoralizing procession of debacles and retreats. A series of Clinton appointments—Lani Guinier, Zoë Baird—came under conservative fire and were withdrawn in a panic. He steered his agenda toward right-of-center goals, like the North American Free Trade Agreement and a crime bill, serving only to alienate his liberal allies without dampening hysterical attacks from conservatives and the business lobby. Health care reform collapsed entirely, in part because liberals refused to support a compromise final measure. Six months into Clinton’s presidency, after he had abandoned his effort to integrate gays into the military, then–New York Times columnist Bob Herbert summarized what had already settled as the liberal narrative: “The disappointment and disillusionment with President Clinton are widespread. . . . He doesn’t seem to understand that much of the disappointment and disillusionment is because he tries so hard to be liked by everyone.” Hardly anybody contested that portrait.
After Republicans swept the midterm elections, Clinton moved further rightward. He famously declared that “the era of big government is over” and brought in reptilian operator Dick Morris—not yet the right-wing conspiracy-monger seen on Fox News these days, but distinctly right of center—as his chief political adviser. He signed a welfare reform bill containing such draconian provisions that several liberals resigned from his administration in protest.
Clinton, according to his contemporaneous liberal critics, turns out to have suffered from the same pliability and pathological eagerness to please the opposition that liberals diagnosed in Obama. But here is a funny thing. If we move back in time toward the last Democratic president before Clinton—Jimmy Carter—we find the same pattern of liberal despondency asserting itself again.
In fact, the liberal failures of Obama and Clinton are but tiny potholes next to the vast gulch of failure that was the Carter presidency. Today Carter is remembered as a president anchored in liberal values, a revision of history both conservatives and Carter himself are happy to leave uncorrected. But the truth is that Carter’s domestic agenda carried only small bits of liberalism, and those small bits (a consumer protection agency, tax reform) met with total failure in the Democratic Congress. Carter’s policy accomplishments tilted right of center—he deregulated the airline and trucking industries and cut the capital gains tax. Most infuriatingly to liberals, Carter refused to push for comprehensive health care reform. A Carter adviser later recalled that the president “did not see health care as every citizen’s right, nor did he think the government has an obligation to provide it.”
Carter’s post-presidency commitment to moral action was hardly evident while he was in office. After James Fallows departed the Carter administration, where he worked as a speechwriter, he wrote a damning 1979 story in The Atlantic titled “The Passionless Presidency.” Ted Kennedy challenged Carter during the 1980 primaries and came close to unseating him. During the general election, progressive Republican John Anderson waged a third-party bid that won some of the liberal anti-Carter vote. The Times’s editorial board captured the liberal view of the era when it relayed the joke of a voter with a gun to his head who was asked to choose between Carter and Ronald Reagan and replied, “Shoot.” The New Republic, in a 1980 editorial endorsing third-party candidate Anderson, concluded Carter “has failed by both the general standards of competent administration and the special standards of the liberal agenda.”
The last Democratic president before Carter also had a turn as object of liberal fantasy and stand-in. Lyndon Johnson came to epitomize the ability, allegedly absent in the forty-fourth president, to bend Congress to his will. As one political reporter noted wistfully in 2011, “Unlike Obama, he knew how to work the system.” True, Johnson did pass sweeping domestic legislation during his first two years, when he enjoyed enormous margins in both chambers. But after his party suffered setbacks during the 1966 midterm elections, Johnson’s agenda ground to a halt—suggesting either that his magical ability to cajole Congress had left him, or that Congress always had minds of its own, and Johnson could pass lots of laws only when he had enough minds predisposed to agree with him.
The Obama-era veneration of Johnson must have evoked dark laughter among the progressive activists who drove LBJ from the race and held violent protests against his successor, Hubert H. Humphrey, a liberal stalwart who had extended the New Deal and pushed his party to adopt civil rights. (The famous demonstrations in Chicago in 1968 were, of course, directed not at Richard Nixon or even Johnson but at Humphrey, who was further stalked by angry crowds on the campaign trail until the election.)
But what about John F. Kennedy, the liberal icon? Kennedy’s reputation benefited from a halo of martyrdom, deepened by liberals’ rage against Johnson, which retroactively cast Kennedy as far more progressive than he actually was. In reality, Kennedy’s domestic agenda slogged painfully through a Congress controlled by a coalition of Republicans and conservative southern Democrats. He campaigned promising federal aid for education and health insurance for the elderly but didn’t get around to passing either one. The most agonizing struggles came on Kennedy’s civil rights agenda. His soaring campaign promises quickly grew entangled in a series of bargains with Jim Crow Democrats that liberals justifiably saw as corrupt. Kennedy understood he lacked the votes in Congress to push the civil rights legislation he promised. When Freedom Riders traveled into the Deep South to test the meager protections in place, Kennedy pressured them to call it off, then struck a deal to have them arrested (to avert the likely alternative that white supremacists would kill the riders).
Trying to jump-start a domestic agenda that conservative southern Democrats had bottled up, Kennedy placated James Eastland, a powerful Jim Crow senator from Mississippi, by nominating the arch-segregationist judge William Harold Cox to the federal bench. Civil rights leaders viewed Kennedy’s machinations with something less than unbridled gratitude. Rev. Martin Luther King Jr. said that Kennedy “vacillated” on civil rights. When he set up a meeting with civil rights activists, Kennedy was surprised to be “scorched by anger,” as G. Calvin Mackenzie and Robert Weisbrot wrote in a recent history of the 1960s.
Harry Truman has become the patron saint of dispirited Democrats, the fighting populist whose example is invariably cited in glum contrast to whatever bumbling congenital compromiser happens to hold office at any given time. In fact, liberals spent the entire Truman presidency in a state of near-constant despair. Republicans took control of Congress in the 1946 elections and bottled up Truman’s domestic agenda, rendering him powerless to expand the New Deal, which liberals had hoped he would after the war had ended. Liberal columnist Max Lerner decried Truman’s mania for “cooperation” and his eagerness “to blink [past] the real social cleavage and struggles,” attributing this pathological eagerness to avoid conflict to his “middle-class mentality.” (Some contemporary critics reached the same psychoanalysis of Obama, substituting his bi-racial background as the cause.) The New Republic’s Richard Strout lamented how “little evidence he has shown of being able to lift up and inspire the masses.” The historian Richard Pells has written that in the eyes of liberals at the time, “the president remained an incorrigible mediocrity.” The Nation called him a “weak, baffled, angry man.”
An exception to this trend, but only a partial exception, is Franklin Roosevelt, the most esteemed of the historical Democratic president-saints. Roosevelt is hard to compare to anybody, because his achievements (helping pull the country out of the Great Depression and win World War II) were so enormous, and his failures so large as well (court-packing, interning Japanese-Americans). But even his triumphs, gleaming monuments to liberalism when viewed from the historical distance, appear, at closer inspection, to be riddled with the same tribulations, reversals, compromises, dysfunctions, and failures as any other.
Drew Westen, among others, fixated upon Roosevelt as the ultimate counterexample to Obama:
In similar circumstances, Franklin D. Roosevelt offered Americans a promise to use the power of his office to make their lives better and to keep trying until he got it right. Beginning in his first inaugural address, and in the fireside chats that followed, he explained how the crash had happened, and he minced no words about those who had caused it. He promised to do something no president had done before: to use the resources of the United States to put Americans directly to work, building the infrastructure we still rely on today. He swore to keep the people who had caused the crisis out of the halls of power, and he made good on that promise. In a 1936 speech at Madison Square Garden, he thundered, “Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me—and I welcome their hatred.”
This version of the Roosevelt legend is mostly false. Roosevelt did not run for office promising to boost deficit spending in order to stimulate the economy. He ran a campaign lacerating Herbert Hoover for his allegedly irresponsibly high deficits, then immediately passed an austerity budget in his first year. Roosevelt did come around to Keynesian stimulus, but he never seemed to understand it, and in 1937 he reversed himself again by cutting spending, helping plunge the economy into a second depression eventually mitigated only by war spending. Roosevelt, unlike Obama, benefited from having taken office after the depths of the recession had settled in, rather than just before the economy plunged into an abyss.
Modern liberals like to believe that Roosevelt, perhaps through his famous fireside chats, taught Americans the efficacy of government spending in order to combat mass unemployment. In fact, he utterly failed to convince Americans to support fiscal stimulus. A 1935 Gallup poll asked, “Do you think it necessary at this time to balance the budget and start reducing the national debt?” Seventy percent of the public answered in the affirmative. Even after Roosevelt’s sweeping 1936 reelection, another poll yielded 65 percent agreeing that a balanced budget was necessary.
FDR’s 1936 speech denouncing “economic royalists” represented just a brief populist turn of his rhetoric. Usually he tried to placate business. When he refused to empower a government panel charged with enforcing labor rights, a liberal senator complained, “The New Deal is being strangled in the house of its friends.” Roosevelt constantly feared his work-relief programs would create a permanent class of dependents, so he made them stingy. He kept the least able workers out of federal programs, and thus “placed them at the mercy of state governments, badly equipped to handle them and often indifferent to their plight,” recalled historian William Leuchtenburg. Even his greatest triumphs were shot through with compromise. Social Security offered meager benefits (which were expanded under subsequent administrations), was financed by a regressive tax, and, to placate southern Democrats, was carefully tailored to exclude domestic workers and other black-dominated professions.
Compared with other Democratic presidents, Roosevelt enjoyed relatively friendly relations with liberals, but there nonetheless existed a left opposition during his time, mostly of socialists and communists, who criticized him relentlessly. Progressive senator Burton Wheeler complained that FDR, “for all his fine talk, really preferred conservatives to progressives.” And actually, the Roosevelt era had the same pattern we see today, of liberals angry with the administration’s compromises, and the administration angry in turn at the liberals. In 1935, Roosevelt adviser Rexford Tugwell groused of the liberals, “They complain incessantly that the administration is moving into the conservative camp, but do nothing to keep it from going there.”
Princeton professor and activist Cornel West, a vituperative Obama critic, reached even further back into history for a comparison with which to disfavor the subject of his bitter disappointment. “You would think that we needed somebody—a Lincoln-like figure who could revive some democratic spirit and democratic possibility,” he told Thomas Frank. “You have to be able to speak to those divisions in such a way that, like FDR, like Lincoln, you’re able to somehow pull out the best of who we are, given the divisions. You don’t try to act as if we have no divisions and we’re just an American family.”
The Lincoln of West’s imagination, then, was a figure who would never “act as if we have no divisions and we’re just an American family.” This is the same Lincoln who, in his inaugural address—delivered after seven states had already seceded from the Union—declared, “We are not enemies, but friends. We must not be enemies. Though passion may have strained, it must not break our bonds of affection.”
In fact, the real Lincoln was a carefully calculating politician, always careful not to step too far ahead of public opinion. Progressives distrusted and even loathed Lincoln with an intensity that exceeds West’s own distrust of Obama. In 1862, William Lloyd Garrison called the Great Emancipator “nothing better than a wet rag.” Frederick Douglass lambasted him for “allowing himself to be . . . the miserable tool of traitors and rebels.”
It is not as if the criticisms of Lincoln were always wrong. In his time, Lincoln was a politician, not the saint of historical memory. He carefully tended his political capital, compromising repeatedly with advocates of slavery in order to maintain his war coalition. Even the Emancipation Proclamation was cautiously framed as a war measure, rather than an attack on slavery, and it withheld freedom from slaves in Union states. Nor were his political calculations always shrewd. Lincoln saddled his army with incompetent generals for years. Fearing for his reelection prospects, he replaced his abolitionist vice president, Hannibal Hamlin, a committed opponent of slavery, with Andrew Johnson, a proslavery southern Democrat. When Johnson assumed the presidency following Lincoln’s assassination, he fervently obstructed efforts to safeguard rights for freed slaves, making his appointment by Lincoln one of the most consequential (and avoidable) errors in history. Lincoln was “a pretty sad man, because he could not do all he wanted to do . . . and nobody can,” concluded one student of his presidency, in 1940. That student was Franklin Roosevelt—who, like every figure to hold the office, had been shorn of any illusion of presidential omnipotence.
All this is to say that eight years of almost continuous disappointment and dismay (or, perhaps, at best, grudging acceptance) reflect an absence of any plausible standard. When liberals judge Obama, or any president, they measure him against a baseline of something very close to perfection. Their desired president enjoys political success without being a politician. When they do try to summon a historical example of a great president, they summon a fantasy. In 2014, the left-wing Georgetown historian (and dismayed Obama enthusiast) Michael Kazin mourned the president’s “ineptitude,” which contrasted against the great presidents of the past, like Roosevelt and Lincoln, among others, whose success was owed to the fact that “both admirers and detractors knew exactly what they stood for.” This not only inverts the facts of those historical presidents whose constant trimming and equivocation drove their own supporters mad—it inverts the very process of how progress works. Victory is never clean or total. As with every president in history, Obama’s achievements were not merely limited and compromised by circumstances beyond his control, but he also compounded his difficulties with errors of strategy. Being president is hard, and Obama has not done the job perfectly. His supporters, however, displayed a consistent inability to measure his successes and failures against a realistic comparison.
The left, in particular, yearns for a climactic triumph over the massed forces of reaction and wealth. Left-wing dissatisfaction produced splinter candidates in 1948 (Henry Wallace, to whom progressive voters disillusioned with Harry Truman flocked) and 2000 (Ralph Nader, whose vote total in Florida outstripped George W. Bush’s winning margin in the state many times over). Liberal dissatisfaction played a major, and likely decisive, role in Richard Nixon’s 1968 victory over Humphrey. Despair is the liberals’ default state.
The American state of the present day has a dramatically more progressive cast than it did a half century ago, and it had a more progressive cast a half century ago than it did fifty years before, and on and on. Yet the progressives who produced these victories have lived them as deflating failures. They have made the same errors of perception time and again.
“It’s naive to think you’re going to change American policy by compromising on a lot of stuff,” complained Rolling Stone editor Jann Wenner. That happens to get historical reality almost perfectly backward. Presidents change policy almost exclusively through compromise. Seen through the prism of ideological purity, the history of American liberalism from emancipation (which left millions of former slaves in slavelike conditions) to Social Security (a piddling pension initially denied to 40 percent of the workforce) to Medicare (designed to placate the doctor and insurance lobbies) is a history of sellouts. Only with the perspective of history, and often a series of incremental improvements, do such things acquire the sheen of idealistic grandeur. That clarity will emerge over time, as Obama’s supporters embrace an appreciation that largely eluded them during his.