In the Arena

Neoliberalism: The Actual Record

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Well, everyone’s talking about the David Brooks column I mentioned below. Obviously, I think Matt Yglesias is on the right track and Atrios is careless and wrong .
In fact, the “liberal successes” of the Clinton presidency weren’t experienced–or much noticed–by academics and upper-income libs…but they sure were significant if you were a member of the working poor. Some facts:

1. As David Ellsworth–a welfare reform opponent–documented, the quiet battles that Clinton fought year after year against the Republican Congress added huge amounts to the benefits of, say, former welfare moms–from about $2500 annually to more than $7000 (the stats are from memory and may be slightly off). There was also a dramatic expansion of programs like daycare assistance, Head Start and college tax credits for the working poor (and, with the college tax credits, for the middle class as well).

2. Welfare reform saved enormous amounts of money by knocking scammers off the rolls–a form of government waste that had made the middle class extremely skeptical of Democratic social plans. (In retrospect, Clinton acknowledged that if he had passed welfare reform first, he would have had a much better chance of passsing health care.)

3. Clinton’s fiscal conservatism helped produce a boom that raised wages, reduced poverty–and stuck a permanent thumb in the eye of the supply siders: he raised taxes on the wealthy and the economy boomed.

4. From what I can tell, most economists regard NAFTA as a wash. And I can say this for certain: The neolib tendency toward free trade is far more realistic and responsible than those who hold out the hope that American manufacturing jobs can somehow be protected if the U.S. unilaterally gets tough with our overseas trading partners. That sort of protectionism is nothing less than cruel and misleading. It will result in higher prices…and fewer manufacturing jobs.

5. As I say below, and as Yglesias points out, “neoliberalism” is something a straw man. To my mind, the toughest New Democrat in the Clinton Administration was Al Gore–he actually convinced Clinton to sign welfare reform, and he argued in favor of getting involved in the Balkans, going the fiscal conservative route and signing NAFTA. Previously, he had favored putting Pershing Missiles in Europe, opposed the nuclear freeze and voted for the first Gulf War….And to my mind, Gore remains the substantive model of a New Democrat today: against the war, against global warming and in favor of universal health insurance. The latter two programs, by the way, will only be achieved the neoliberal way–thru progressive tax credits and market incentives like cap-and-trade programs.

Update: I should add that Atrios is also wrong about affirmative action. In 1995, Dick Morris told Clinton that he wouldn’t be reelected if he didn’t back away from affirmative action. Clinton refused to change his position…In any case, affirmative action is a weird issue to bring up: it mostly affects middle to upper middle class African-Americans (again, in academia–a “liberal” program that the academic elites tend to notice). I always thought it was integration on the cheap: we did affirmative action instead of putting more money and better teachers in the poorest neighborhoods. (As for the “minority set-asides” in government contracting, that was too easily scammed by white contractors setting up black employees as sub-contractors.)