John Edwards: The Great Left Hope for 2008

Edwards is the most left-wing, pro-labour candidate among the Democratic front-runners. He has been speaking truth to power in a way that is rare in Canadian politics, let alone American politics. Can he win the nomination?

Since Clinton is still well ahead in nationwide polls, much will depend on whether Edwards can gain momentum by winning Iowa on Thursday. Although the media has framed the Democratic primaries as a two-way race between Clinton and Obama, indications that Edwards is tied with them in Iowa keep bubbling out.

The following op-ed by Thomas Palley appeared in the Des Moines Register on December 26. Unfortunately, its website crashed that day so the op-ed is not available there.

Other analysts have suggested that the main differences between Democratic candidates are not on issues, but over how to bring about change. However, as Palley notes, the apparently similar positions on issues reflect Clinton (and Obama) having tacked left to counter Edwards. One clear difference is that Edwards referred to the “War on Terror” as “a bumper sticker, not a plan,” whereas Clinton continues to promote a militaristic foreign policy.

She is explicitly running on her husband’s economic record. While many Democrats harbour fond memories of Clintonism and the prosperous 1990s, Palley quite correctly notes that today’s free-market policies are mostly the policies of that period. Edwards is the best hope for a progressive economic agenda, which is why I want to believe that he can win the Democratic nomination.

UPDATE (Jan. 1): Political parties often face a choice between the leadership candidate who most embodies their ideology and the one most likely to win a general election. However, there is a significant body of evidence that, of the Democratic front-runners, Edwards would fare best against potential Republican opponents.

Admittedly, there are also indications that Obama would be most likely to beat the Republicans. Clinton, who seems to be the most popular candidate among Democrats, would clearly stand the worst chance in a general election.

Given the goal of winning electoral-college votes, my sense is that the best Democratic electoral strategy is to nominate a Southernor. If so, Edwards combines the best electoral prospects with the best stances on policy.

UPDATE (Jan. 3): Although I missed it when it happened, Ralph Nader has endorsed Edwards. This endorsement is a mixed blessing because many Democrats understandably blame Nader for splitting the presidential vote in 2000. However, Nader’s history of rightly criticizing Democratic leaders for mirroring the Republicans on economic issues makes his support for Edwards particularly meaningful.

UPDATE (Jan. 4): A group of progressive American economists, including James Galbraith and Palley, has endorsed Edwards.

Centrist or progressive: What kind of change do Dems want?

By Thomas I. Palley

Des Moines Register, Wednesday December 26, 2007

Many people now believe the United States cannot afford to continue with the policies of the Bush-Cheney administration. Those policies have undermined global support for America – a key part of national security – and have produced an economic expansion that has bypassed working families and looks as if it will bequeath years of house-price pain.

However, if there is agreement that the heavy-fisted Bush-Cheney agenda is no longer acceptable, the question remains what will follow. Among Democratic presidential candidates, although there is much talk of change, its meaning remains unclear.

Beginning some 30 years ago, Ronald Reagan initiated a fundamental repositioning of American politics that was later completed by Newt Gingrich, Dick Armey and Tom Delay. That repositioning shifted the entire political spectrum to the right.

This raises the question: Does change mean sticking with the political playing field we now have and just giving control of the football to new Democrats such as Sen. Hillary Clinton? Or does it mean repositioning the playing field and shifting the political spectrum as proposed by progressive Democrats such as Sen. John Edwards?

Behind this difference lies vital real-world consequences that will profoundly impact America’s working families. For Clinton-style centrists, today’s economy works reasonably well. Globalization delivers prosperity by providing cheap imports that lower prices; a financial boom on Wall Street benefits all by raising stock prices; and higher corporate profits drive investment that increases growth and incomes. However, growth also creates losers, which means the market’s “invisible hand” must be accompanied by a “helping hand.” Consequently, policies are needed to supplement the incomes of the working poor and to assist workers who lose their jobs because of trade.

For Edwards-style progressives, the picture is very different. Globalization has created a divide between country and corporations, as companies abandon the United States by shifting jobs and investment offshore. That maximizes profits but undermines wages and future prosperity. Higher profits have not raised growth, but have instead come at the expense of wages and increased income inequality. And Wall Street has spearheaded these changes by demanding that companies raise rates of return, ripping up the old social contract with workers and their communities.

From a progressive standpoint, the problem with new Democrats is they tackle symptoms, not causes. Though helping-hand social policies are welcome, progressives believe such policies are not up to the challenge confronting America’s working families. Meeting that challenge requires deeper change, which is what the 2008 election is all about.

Yet, surfacing this difference has proved difficult. That is because the Clinton campaign has used the political tactic of “bunching” to obscure differences. The tactic holds for every major issue from health care, to trade policy, to taxing Wall Street hedge-fund incomes. On each issue, the Clinton campaign has bunched up and signed on, but always reluctantly and late.

This tactical success of bunching requires progressives to raise directly the question of change and its meaning.

For Sen. Barack Obama, change is a matter of political style. For Clinton, it means restoring the economic policies of the 1990s.

However, with the exception of tax cuts, those policies are the policies of today. Thus, the 1990s ushered in the North American Free Trade Agreement and free trade with China, and cemented trends from the 1980s regarding trade deficits, the separation of wages from productivity growth and the dominance of Wall Street. What really saved the 1990s were the Internet and stock-market bubbles, which are not a sustainable foundation for prosperity.

Social Security exemplifies what is at stake. New Democrats downplay the problems of globalization and the power of corporations and Wall Street and instead identify the budget deficit as the nation’s No. 1 problem. That perspective establishes the predicate for cutting Social Security benefits, something Clinton has openly left on the table. Whereas Republicans have long been able to create much mischief around Social Security, they can change and cut benefits only with the help of Democrats.

The 21st century has gotten off to a rocky start as America has squandered much political and economic capital. Now, Americans want change. The Democratic caucuses and primaries offer two visions of change. One changes possession of the political football; the other changes the football field. That’s the debate the country needs, but it is still missing.

THOMAS PALLEY is founder of the Economics for Democratic & Open Societies Project, Washington, D.C. He blogs regularly on economic policy at http://www.thomaspalley.com/.