End of an Era

About a month ago, the Fox News website (of all places) interviewed me for an article on historians’ assessments of Bush II’s legacy.  The reporter began with the well-worn idea that it takes a few decades to fully assess a presidency, an idea about which I’ve always been ambivalent.  Sure, some things take time to figure out.  But as I told the reporter: “It doesn’t take a historian to know that this is going to be a presidency that will not be seen favorably in retrospect.”

I also made the following claim:  “Higbie said the Bush term will be seen as the last presidency that the Reagan period opened, including dynamics such as a bolstering of the private sector and business amidst a weakening labor movement.”

I was pleasantly surprised to see that one of the high priests of global business agrees with that idea.  From an article on Bloomberg last week:

Billionaire investor George Soros said the current economic crisis has its roots in the financial deregulation of the 1980s and marks the end of a free-market model that has since dominated capitalist countries.

Liberalization of the financial industry begun by the Reagan administration has led to a series of breakdowns forcing government intervention, Soros told economists and bankers last night at a private dinner at Columbia University in New York.

It’s always nice to feel that you’re ahead of the curve, however, the notion has certainly been in the air since the 2006 elections so I don’t claim too much originality.

But what is very interesting in light of Soros’s comments is the speed with which the ideological hegemony of business, of neoliberal globalization, is crumbling.  A month ago, there were only a few voices in the media wilderness calling for the nationalization of banks.  In the midst of the fight for the stimulus bill, during which the Republicans called Obama a “Socialist,” Obama declared that nationalization unworkable and contrary to our “culture” (which in retrospect looks more like a hedge than a statement of principle).  The entire Republican game plan during the stimulus fight was based on the notion that we are in a “normal” recession that will “naturally” turn around if we can just “free the energies” of America’s “entrepreneurial spirit.” And much of the media seemed to agree that Obama had over-reached.  That his presidency was finished, a failure almost before it had begun.

Of course, the stimulus passed.  Then last week came word of Alan Greespan declaring bank nationalization a likely necessity, followed by a few members of Congress, and then Soros.  Now the lonely voices in the media wilderness (e.g., Nuriel Rubini) look like Casandras, and folks take a second look when they declare that the “Laizziez-Faire Anglo-American Model of Capitalism” is mortally wounded.  The reason, of course, is that the underlying economic realities are moving well beyond the ideological blinders.  Bank nationalization, however, distastful to our “culture,” is becoming a reality even if we don’t use the word.

The ground is shifting rapidly, and it’s hard to see how it can shift back any time in the next 12-18 months.  Onto that ground comes President Obama more productive after one month in office than many presidents after 4 years.   And still wildly popular.  Ahead of the curve.

Wordle: President Obama's Remarks to Congress, Feb 24, 2009

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