Centerblue.org

It’s one thing to lob bombs from the safety of minority status, it is quite another to lead. With Democrats sweeping the Republicans out of the House for the first time in 12 years, and probably picking up the Senate pending recounts in Montana and Virginia, what they just accomplished was the easy part. Now comes the hard part of leading the country out of the sorry morass in which it finds itself.

Let’s neither under- nor over-estimate the magnitude and meaning of Democratic victory last night.

The leader of the “under-estimate” crowd is the idiotic and disgraced former House Majority Leader Tom DeLay, who with a straight face told MSNBC last night that a Democratic victory in the House would make them nothing more than a “lame-duck majority;” whatever that means, it is infinitely better than being a minority which is what hopefully faces his party for the foreseeable future. I have also seen lots of bloggers, liberal ones especially, downplay the meaning of the election as having been limited to just a few corrupt officials, say it’s a “small step forward,” it wasn’t a landslide, and so on.

From whence comes this pessimism? Have we been out of power so long we are still too afraid to relish being in the majority, fearing that we might wake up any minute and find out it was just a dream?

When the Republicans ushered in their so-called Republican Revolution in 1994 with guns blazing, by what margin did they hold the House? The GOP led Democrats by 230 to 204, a margin that shrank in the intervening years and one that was won mostly by victories in the conservative South. How about now? Democrats picked up at least 27 seats last night without losing a single one (unheard of in modern memory even in 1994), many of them in the Northeast but also in all other areas of the country. That put the count at around 228 Democratic, 195 GOP, and 12 still undecided as of this morning. Pretty close to 1994 in reverse, huh? With that 230 to 204 margin the GOP, for better or for mostly worse, imposed a long period of Republican hegemony in Washington that didn’t end until last night. If that number was good enough for them, it’s good enough for Democrats.

On the other hand, let’s not over-state the case either. Democrats won more for being the anti-Bush than for the strength of their own vision, and nobody is claiming a revolution. I don’t see that as a bad thing. An old saw in politics is that when your enemy is self-destructing, you stand back and let it happen. Republicans were doing such a good job of imploding, and voters seemed so eager for a change, that there was no reason for Democrats to stick their necks out by proposing plans and visions that would subject them to hostile fire. Keeping mum on a specific agenda was therefore good politics.

Now the election is over, the Elephant is dead, and it’s time for Democrats to grapple with the reins of power. I do not envy them the huge mess they have been left with to fix: Iraq. North Korea. Iran. Global warming and accelerating environmental degradation. Corruption. An economy teetering on the edge of a nasty recession or worse caused by a flattening housing market, loss of confidence in the dollar, and massive federal debt and trade deficits. Oil addiction to hostile countries. Stagnant wages. Soaring healthcare costs. The imminent retirement of the baby boomers and the accompanying burdens on federal entitlement programs.

The problems are monumental, and the nation is looking to Democrats to start providing some answers. If they succeed, they will likely forge an enduring majority. If they do not, they will either return to minority status or exchange power every so often with Republicans. In a way the deck is stacked against them, since many of the problems that were created by Republicans will see their full fallout and consequences under Democrats’ watch, and they therefore stand to be unfairly punished in the future. But that’s the nature of politics, and Democrats will either cope or not.

As they struggle for answers, the more liberal leadership should not forget that they were brought to power on the backs of moderates and conservatives who wrested districts away from Republicans. The center-left forms the backbone of the new Democratic resurgence. These people, the Blue Dog Democrats and others like them, will have to answer to their constituencies again in the not-too-distant future, and you can bet these folks will push hard for the kind of centrist agenda that the DLC and Rahm Emmanuel espouse. This alignment towards the center is also good for the party because our gain of moderates (truly the heart of America) is Republicans’ losses of same, making them more than ever a minority party of extremists on the Right.

Democrats are off to a good start, promising in their first 100 hours to do things like raise the minimum wage and force pharmaceutical companies to compete and lower prices for the Medicare prescription drug benefit. They will not have much time to celebrate and measure the drapes before being called to account for their vision on how to fix the mess in Iraq.

They better be ready.

The Dow Jones Industrial Average is hitting record highs. Gas/oil prices have retreated somewhat. Unemployment is at a historically low 4.6%. Inflation remains under 3%. Interest rates have receded.

By these and other measures such as GDP, the economy is doing well. Why, then, are voters angry about the economy, with a majority saying they disapprove of Bush’s/Republicans’ handling of the economy?

Alan Murray hits the nail on the head with his commentary in today’s Wall Street Journal:

Large numbers of Americans seem to have lost their belief in John F. Kennedy’s famous aphorism that a rising tide lifts all boats. “They know the economy is white hot,” says political analyst Charlie Cook, “but they also know they aren’t in it….There’s a feeling that some people are getting theirs, but we aren’t getting ours.”

There’s a well-known litany of reasons for that. Median earnings have been growing at a disturbingly slow pace, even as profits and high-end pay have soared. Health-care costs are not only increasing, they increasingly are being paid by consumers, not by employers or the government. Pensions are disappearing, as is job security — and any sense of long-term loyalty from employers. As pollster Peter Hart puts it, “there’s no gold watch” waiting at the end of a career these days. He cites a cartoon in which the boss says: “Mr. Jones, the reason we are letting you go is because you’ve given us the best years of your life.”

Meanwhile, a thin slice of America is enjoying unprecedented prosperity. CEO pay is one of the most visible manifestations, rising in the past decade at triple the rate of the median worker’s pay. In…Greenwich, Conn., skilled financiers bring home eight- and nine-digit paychecks, unimaginable in the not-so-distant past. Americans have never been big on the politics of envy, in part because they hoped someday they would join those at the top. But increasingly, they wonder whether the economic game is rigged, and whether all these riches are the result of backdated options or insider trading or some other trickery that doesn’t benefit them.

He goes on to note that the disconnect occurring between the upper class and everyone else may result in the demise of the pro-business, free-market platform popular in Washington for the last quarter century. Increasingly, Democratic challengers like Senatorial contender Sharrod Brown of Ohio are adopting a populist, anti-trade, anti-globalization, anti-immigration, anti-big big business message that is bound to appeal to the struggling and rapidly disappearing American middle class.

I have mixed feelings about this. Obviously the sources of increasing inequality are glaringly obvious and real as described in the article…but I’m concerned about tossing the baby out with the bathwater. America is really feeling the negative effects of globalization (which powers a lot of the deleterious changes being seen in American industry), because our standard of living has been so much higher compared to the rest of the world. Globalization evens the scales, and while that means an improvement to everyone else it means pain for us. Can we really avoid this, though..or should we?

The rest of the world has the same right to a higher standard of living as Americans do. But even if we disagree on this point, it’s hard to see how we could get America to “opt out” of the globalization taking place everywhere else without being left woefully behind. For all its drawbacks, globalization does increase trade, wealth, and access to technology..to the ultimate betterment of all. Can we really afford to build a virtual wall around us, and would such a wall succeed? It never has before.

There’s a lot wrong with globalization that is hurting Americans, and these things must be fixed. A glaringly obvious example is other countries’ disregard for health, labor, and environmental standards for their workers–which allows them to milk their workers for pennies on the dollar while American industry is “saddled” with these obligations. We have to exert strong pressure on our trading partners to adopt similar standards so that all wealth is created fairly without placing unjustifiable burdens on workers or the environment. Another example of globalization gone wrong is countries like China manipulating their currencies to maximize their exports, keeping them cheap regardless of true fundamental supply and demand. This too must stop.

There are also problems with American business itself. Why do CEO’s make ridiculous salaries (more than 42 times that of the average worker) without such pay being tied to solid performance? Why is there so much crookedness surrounding stock option grants? Why are prescription drug prices so out of control when compared to the rest of the world? Why are companies allowed to fund worker retirement plans with risky company stock instead of cash to be invested as the worker wishes? Why are we failing to address the looming crises of social security and medicare, those safety nets for Americans most in need? Why do we keep cutting taxes on those who need it the least instead of those who need it the most? Government has a duty to answer these questions for the sake of the middle class, and my personal belief is that these questions of fair trade and fair business are where Democrats should focus their attention instead of appealing to people’s xenophobia.

Fixing problems like this won’t cure all the pain, but will minimize it while allowing America to reap the longer-term benefits of globalization–improved living standards elsewhere create larger markets for our products. Americans have a long history of believing they live in a meritocracy–a society where anyone who works hard enough can climb the upper rungs of the ladder of success. Globalization and a broken American system of business are increasingly rigging the game against most Americans while letting the upper class elite reap wealth beyond the imagination of most people.

This disparity has to end, and Democrats would do well to address it without digging their heads in the sand against the rest of the world. God knows we’ve done enough of that under the Republicans.

Wal-mart announced today that it will begin a pilot program soon that will offer generic drugs to both the insured and uninsured for as little as $4 a month for a 30-day supply.

In doing so, it brings to bear its huge influence in the American economy and its legendary ability to wring cost and inefficiency out of its supply chain. While the chain says it will not pressure pharmaceutical companies (and that the lower cost comes solely from more efficient distribution), it wouldn’t surprise me if it does so if and when the program ends up being popular.

Additionally, competitors like CVS whose supply chains are not nearly so legendarily efficient will come under severe pressure to turn the screws on Big Pharma lest they start bleeding red ink.

It’s about time that American businesses step in where the federal government has so miserably failed, and start putting the reins on soaring healthcare costs. This will also be a much-needed reprieve for the millions of elderly and poor who must choose every month between food and their prescriptions.