Editorial
December 9, 2011 7:28 pm
US heads for class warfare election
It is a sure bet that when the name Roosevelt is mentioned by a Democratic president – whether it is Teddy or Franklin – allegations of class warfare will follow. On Tuesday, Barack Obama evoked Teddy Roosevelt when he spoke at Osawatomie, Kansas, where his predecessor had called for a new age of progressive “nationalism” more than a century ago.
Mr Obama was no less ambitious. In a speech that set out the guts of his 2012 campaign, the president called for a society where “everyone gets a fair shot, when everyone does their fair share, when everyone plays by the same rules”. Blaming the Great Recession on the “breathtaking greed” of the financial elites, Mr Obama called on the wealthiest to pay a higher share in taxes.
Unlike his forebears, Mr Obama stopped short of branding opponents as “economic royalists” or “malefactors of great wealth” – and he gave no hint he would “welcome their hatred”. But Republicans lost no time detecting a new era of class warfare in which the president will scapegoat America’s wealth creators for his own failings. And thus are the 2012 battle lines being drawn.
This should be both welcomed and feared. Welcomed because America needs an election focused on the economy. Mr Obama is neither a “Kenyan anti-colonial”, as Newt Gingrich has said, nor the “apologiser-in-chief” for America, as Mitt Romney believes. These are bizarre distractions. But the two sides do have legitimate disputes on how to dig America out of what is turning into a prolonged phase of economic anaemia.
It is also the debate voters want. Whether you look at the polls, in which economic concerns outweigh all, or the streets, where the Tea Party and Occupy Wall Street shout out a mostly economic list of grievances, it is the economy which stirs debate. That is useful for the parties to fire up their grassroots: on Tuesday Mr Obama came close to endorsing the 99 per cent mindset of OCW, and Republicans have long since taken up the Tea Party’s anti-tax populism.
Yet there are grounds to fear that the debate may generate more heat than light. To be sure, the wealthiest could easily revert to the 39.5 per cent tax rate they paid under Bill Clinton from the 35 per cent rate that holds now. But a higher top rate of marginal tax will not solve America’s problems.
On the fiscal front, America needs a grand compact that would deliver medium-term discipline, which should include both higher taxes and lower spending. In theory it should not be hard. In practice, the climate is too polarised for consensus. Just as important, but far tougher to fix, is America’s competitiveness crisis in which large swathes of its labour force are being outcompeted in a rapidly integrating global economy.
Mr Obama is not a class warrior. But he has not yet found a compelling way to address what lies behind America’s deepening inequities. The Republicans are even further from a solution. Let us hope class warfare marks only the starting point for a conversation.
Copyright The Financial Times Limited 2011.
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