I knew when I left for Europe that in all likelihood President Obama would be re-elected, though I was anxious. The stakes were high. If he won, as expected, my return from my few weeks visit would feel like I was truly returning home. If he lost, I would feel like I was venturing to an alien country, one that I had hoped had been left behind, a country trying to revert to a state that didn’t include me, and many others, as full citizens.

A key of the Obama election, presidency and re-election has been inclusion, and the Republicans were pushing back, clearly revealed in their voter ID, voter suppression campaign. The changing demography helps to explain the President’s victory, but his great gift to the country has been to show the country how these changes are our greatest strength. The changing demography plus Obama’s vision go a long way in explaining the election results and the forthcoming changes in the United States.

He did it again in his victory speech as the nation’s storyteller-in-chief. It was a beautiful conclusion to a less than beautiful election. The ugliness of the opposition to Obama left a bad taste in our collective mouths for months, in fact, for years, thanks to the Tea Party, Fox, Rush and company. Obama in his victory speech reminded the American public and the rest of the world to keep our eyes on the prize. I watched on CNN in my hotel room in Warsaw. Today, I watched again with my friends at the Theodore Young Community Center. We decided to share the moment together. We were inspired.

“Our man,” as my dear friend Beverly McCoy speaks of the president, first got our attention, by marking the accomplishment of a free election and celebrating all who took part, linking fundamental political facts with the theme of his campaign, but including those who campaigned against him:

“Tonight, more than 200 years after a former colony won the right to determine its own destiny, the task of perfecting our union moves forward.  (Applause.)

I want to thank every American who participated in this election.  (Applause.)  Whether you voted for the very first time or waited in line for a very long time — (applause) — by the way, we have to fix that.  (Applause.)  Whether you pounded the pavement or picked up the phone — (applause) — whether you held an Obama sign or a Romney sign, you made your voice heard, and you made a difference.  (Applause.)”

He highlighted common goals of all Americans:

“(D)espite all our differences, most of us share certain hopes for America’s future.  We want our kids to grow up in a country where they have access to the best schools and the best teachers — (applause) — a country that lives up to its legacy as the global leader in technology and discovery and innovation, with all the good jobs and new businesses that follow.

We want our children to live in an America that isn’t burdened by debt; that isn’t weakened by inequality; that isn’t threatened by the destructive power of a warming planet.  (Applause.)”

He presented his specific policy priorities in his speech, as they are part of American aspiration: education, economic and technological development, the deficit and growing inequality, and climate change. The way he formulated these problems in this passage, I imagine, is difficult to oppose, though it is noteworthy that he was outlining a political center that he was attempting to move to the left.

I take this to be his specific political orientation, which explains why he spent so much of his time during his first term assuming the goodwill of Republicans when many of his supporters wished he would aggressively opposed them. And it also explains the nature of his great achievements including Obamacare, major advances in equal rights for gays, African Americans, women and immigrants, and significant assistance to the less advantaged as we have been enduring the Great Recession. He seeks a center framed by progressive principles.

And on election night, he emphasized citizenship and its obligations, linking his program with the aspirations and actions of his fellow Americans.

“The role of citizen in our democracy does not end with your vote.  America has never been about what can be done for us.  It’s about what can be done by us, together, through the hard and frustrating but necessary work of self-government.  (Applause.)  That’s the principle we were founded on.

I am hopeful tonight because I have seen this spirit at work in America.

What makes America exceptional are the bonds that hold together the most diverse nation on Earth — the belief that our destiny is shared; that this country only works when we accept certain obligations to one another, and to future generations; that the freedom which so many Americans have fought for and died for comes with responsibilities as well as rights, and among those are love and charity and duty and patriotism.  That’s what makes America great.  (Applause.)”

He went on to described the heroic acts of ordinary citizens: family business owners who took cuts in pay to avoid laying off their neighbors, workers cutting back in their hours so that their fellow workers wouldn’t be laid off, valiant soldiers who re-enlist and who killed Osama bin Laden, and political leaders acting beyond partisan concern to most effectively respond to Hurricane Sandy (an unsubtle shot out for Governor Chris Christie of New Jersey).

He presented his vision of the American Dream with inclusion emphasized:

“I believe we can keep the promise of our founding — the idea that if you’re willing to work hard, it doesn’t matter who you are, or where you come from, or what you look like, or where you love — it doesn’t matter whether you’re black or white, or Hispanic or Asian, or Native American, or young or old, or rich or poor, abled, disabled, gay or straight — you can make it here in America if you’re willing to try.  (Applause.)”

I think it is especially noteworthy that gay or straight and the disabled are on his list.

Obama’s presented in his victory speech, as he campaigned in this election, an expanding vision of equal citizenship with its rights and responsibilities for all. He governed utilizing this vision, and all his major speeches have included this vision from his address to the Democratic Convention in 2004, empowering his race speech, including his victory speech last week. It is part of an inspiring whole.

Demography + vision = the re-election of Barack Obama. It’s good to be home.

As I anxiously await the debate tonight, I am struck by an Facebook exchange on a friend’s Facebook page, which addressed one of the major issues that lies in the shadows, but is nonetheless very much present: poverty and public policy.

Anna Hsiao read Ayla Ryan’s wrenching autobiographical story, “What Being Poor Really Means,” and remarked:

I guess it’s easy to take money away from starving children when they aren’t yours. Right, Mr. Romney?

Eli Gashi, a mutual friend from Kosovo and a former student at The New School wondered:

How can people vote for Romney – I dont get it

Anna Hsiao responded:

It’s pure ideology… They’re voting for his money, because that’s somehow gonna make them rich, too.

Muma Honeychild, a friend of Anna’s from Poland, whom I don’t know, insisted:

but how, really?

Anna:

Like it requires rational cause-effect thinking! We are masters of voting against our own interest – Bush’s two terms, hello….

While, Aron Hsiao, Anna’s husband and a student of mine, offered a different theory:

People mistake the absence of misfortune and a hindsight of fortuity for moral and ethical superiority. It’s a monotheist and specifically Protestant tendency, to my eye. “You’re suffering? Well, I haven’t suffered. God and the universe have punished you and rewarded me. Clearly, you have done something wrong and I have done something right.” That’s the morality of Mitt, and the morality of half of America. They will only develop “empathy” once they, too, find themselves shocked and crying out about the injustice of what has just happened to them. “Why do you failures not take responsibility for your own suffering!?” will become “Why has God forsaken me?!” and only then will they–at length–understand (and only some of them). It will only take another Great Depression to cause America to once again to loathe the idea of a Great Depression. The consciousness colonized by monotheism in most of its present guises cannot learn from mistakes, because the universe is an ordered space not of causality and physics, but of governance by fiat carried out by a moralistic, judging God. The rocks fall only on the heads of the sinners; those skulls that remain intact are the saved. They do not think to don a helmet or to place a “Beware the falling rocks!” sign; no mere helmet or sign can forestall God’s judgment.

To which I responded:

I find this exchange really interesting. I wonder. Would all of you mind if I reproduced it on Deliberately Considered? The question, repeated. The reference to a materialist and then a cultural explanation. I would add my wonder: the materialist explanation is inadequate because Romney is proposing an irrational response to the economic crisis, or at least is pretending to. On the idea of monotheism being the explanation: I would suggest my specification. Monotheism yields belief in one’s own truth, yes. A certain kind of Protestantism may be related to a lack of empathy for the unfortunate, but there are many other kinds. A good sociologist of religion might help us with this. Where is Weber when you need him?

Anna Hsiao:

Mine was merely a frustrated rant in response to what you call Romney’s inadequate and irrational response. I’d love to see a larger discussion on the subject on DC!

I replied:

“The rant” opened up an interesting discussion. I will try to turn it into something for DC.

So here it is. Thinking about inequality and abject poverty, and the kinds of albeit inadequate assistance we now provide, how could anyone support Romney – Ryan, who propose radical cuts in government support for the poor? Is it possible to think about the poor, including the working poor, and understand their situation and propose an increase in their taxes and cutting food stamps? If you pay close attention, it is clear that they do, after all, have much more “skin in the game” than the super rich, who have no moral qualms about hiding their money in Switzerland and the Cayman Islands. Can charity do the trick for Ayla Ryan and her family and the millions of others who have suffered disproportionately during the Great Recession, but also the bubbled booms of the preceding years? And I wonder how does all the talk about the middle class relate to this?

I hope Jim Lehrer raises the issue of  poverty and real human suffering in American tonight, but I fear he won’t.

Last winter – back in the day – Glenn Beck was a roaring tiger. His claws were thought so bloody that when he attacked Frances Fox Piven, one of the leading activist scholars of social movements, a string of professional organizations rose to the lady’s defense, including the American Sociological Association and the Society for the Study of Social Problems. After the shooting of Representative Gabrielle Giffords, many progressives concluded that Professor Piven was next in line for assassination from the rightists roiled and boiled by Beck.

Today we frame Glenn Beck’s symmetry as less fearful. Those who worried that Professor Piven was walking on a knife’s edge might be surprised that her latest book, published in August, is entitled Who’s Afraid of Frances Fox Piven: The Essential Writings of the Professor Glenn Beck Loves to Hate. Glenn Beck has become Professor Piven’s marketing tool. Without Glenn Beck’s opposition, Piven’s writings might seem less essential. (As a fellow former president of the Society for the Study of Social Problems, I am pleased that her deservedly influential writings have become essential. I am attempting to find someone of equal stature to hate me. The placid readers of this flying seminar know that I try my best.)

However, my point is not to critique the pas de deux of Beck and Piven. Rather it is to recall that in my earlier musing on Glenn Beck, I confessed to having become addicted to his rants, his startling readings of American intellectual history. However, beginning early in 2011, sparked by the demonstrations of the Arab Spring, first in Tunisia, then in Tahir Square, spreading to Tripoli and Syria, Beck began warning that these demonstrations were a clarion call to global rebellion. He promised viewers that an uprising was coming to a park near you, reporting every small and inconsequential gathering throughout Europe throughout the spring.

Listening to his fervid predictions, I came to feel that this represented a tea-laced fantasy. Beck had fallen off the dark edge. And perhaps Roger Ailes agreed with me. Beck was escorted out of the Fox studies and into his own Internet redoubt (“the fusion of entertainment and enlightenment”). As he was no longer close by my remote, my addiction ebbed.

Yet, examining the world of November, I can see the outlines of Beck’s vision from January. He informed us – warned us actually – that we would see an uprising on the streets of America. This uprising would not be an occasional frat party, but a hard and determined thing. Beck instructed us that the movement would be global – London, Rome, Athens, Bahrain, Oakland, Atlanta, and Zuccotti Park. What could Glenn Beck see that I could not? What could Glenn Beck see that progressives throughout America missed last spring? Was he a broken clock right twice a decade?

One need not agree that this exuberance of protest is as frightening or destructive as Beck would have us believe. Liberals, libertarians, and perhaps even some brave conservatives might agree with Thomas Jefferson, speaking of Shays’ Rebellion in 1787 that “the tree of liberty needs to be refreshed from time to time with the blood of patriots and tyrants. It is its natural manure.” The Arab Spring reminds us of this same reality, and slowly, imperceptibly those images proved to be a model for actions in Europe and America. When the Occupy Wall Street movement began in September, New Yorkers were primed, and soon others were. But along with the Arab Spring, the Tea Party movement also provided a model. Progressives felt a gathering envy, and OWS was the result. The problem, as I see it, is that while there was a legitimate drive to gather to protest grievances, practical solutions remained distant for the well-intentioned mandarins of the movement.

What Glenn Beck recognized, first through Tea Party Summer, then Arab Spring, then Manhattan Autumn, was that moments of profound discontent, helplessness, and resentment at distant control produce an insistent demand for communal action, a call from agitators left and right. Glenn Beck’s own 8/28/10 Washington gathering to “Restore Honor,” ostensibly an opportunity for faith and commitment, mimicking that of the Reverend King, arose from the same forces.

Beck recognized an emergent power in these hard times: groups sharing common concerns,  gathering, angry, frustrated, and perhaps hopeful. These groups view a cloudy future for which they lack answers, but know that their questions cannot be ignored.

The failure of economics in the runup to and aftermath of the Great Recession has generated a lively debate about how to reform economics and more specifically about the renewed relevance of Keynesian economics, which had fallen out of favor since the 1970s. The Keynesian message, so important in this latest round of political wrangling over the increase in the US debt ceiling, is that cutting government spending in a slump will only worsen the unemployment problem. The role of expansionary fiscal policy, according to Keynesianism 101, is to provide demand for goods (and thus for employees to produce those goods) when the main sources of demand in a capitalist economy — households and businesses – are not providing a level of demand necessary to generate a socially acceptable level of unemployment.

Keynesianism 102 is about the multiplier effect of changes in spending. This is the notion that an increase in demand (from any source, not just government but certainly including government) will impact employment and incomes with a ripple effect. This includes a direct impact and then a secondary impact when the direct incomes are then spent (in some fraction) and an additional fraction of that is spent, etc.

There are two corollaries to the lesson of Keynesianism 102 that are worth mentioning because they have been raised in the current policy debate. The first is about the differential multiplier effect of a spending increase compared to a tax cut. Empirical studies show that the multiplier effect of the former is greater than the multiplier effect of the latter. The second is about the differential multiplier effect depending on the income of the recipients. Since the poor are more likely to spend a higher percentage of additional disposable income than the rich, a tax cut that benefits low-income people will have a bigger multiplier effect than a tax cut that benefits the rich.

These lessons have not been integrated into current economic policy in the US, where deficit spending and progressive tax reform and expanded benefits for the poor and unemployed have been successfully resisted by the Republican congress. Nonetheless, they are well-established lessons of Keynesianism that most professional economists would accept.

The argument against Keynesianism 101 revolves around the psychology of investor confidence in the face of a rising fiscal deficit. The argument is that business people will reduce their investment spending when they see the government deficit becoming very large because it signals the likelihood of some detrimental future adjustment – either in interest rates, tax rates or government outlays – that will be detrimental for future profits. There is simply no empirical evidence to support this theory compared to Keynesianism 101.

But all this is sideshow in comparison to the lesson of Keynesianism 103.  The fundamental economic point of Keynes’s 1936 General Theory of Employment, Interest and Money was not about fiscal policy or the multiplier or income distribution.  It was about the fact that economic equilibrium (a stable condition from which no economic change would occur without external impetus of some sort) will not necessarily be characterized by full employment. Economists prior to (and some subsequent to) Keynes thought that free market economies would naturally adjust to full employment, as an excess supply of labor would lead to a lowering of wages and a corresponding increase in the amount of employment. Keynes explained that the natural state of a capitalist economy is “unemployment equilibrium,” and without a shock to aggregate demand conditions, there was no reason why the economy would not stay at this unemployment equilibrium. Keynes’s insight implied that the wage reduction strategy was not just theoretically wrong but, if implemented, would likely make the situation worse, since it involved a reduction in household buying power and thus would reduce business confidence.

A prospect as disastrous as the second “dip” that the American economy is about to experience is that of a long period of high unemployment that has no natural tendency to reverse itself. We should not stop our analysis at Keynesianism 101 and 102, since the great social problems facing America are understood best by Keynesianism 103.

So what is to be done? Paul Krugman has been a superb critic of the politicians’ focus on the deficit and the debt rather than on job creation. But he has been relatively quiet about what could be done if in fact the political winds were to shift. Robert Reich has been more explicit. His proposals for job creation include:

1. An additional cut in the payroll tax on employees and employers
2. An increase in infrastructure investment

My guess is that President Obama’s speech this evening will address these issues. If it does, it should be understood as not just a political maneuver, but as a serious attempt to tackle our economic problems.

From the fracas in Washington, it would be impossible to know that Americans still live in the world’s richest country. In 2010, the U.S. GDP was about two-and-a-half times that of its nearest competitor, China—you know, the country that’s building new cities everywhere and a bullet train system to ferry citizens among them. But to listen to the political discourse that currently dominates the airwaves, the U.S. is facing financial collapse, if not now then in another decade, and it cannot afford another dollar for many collective goods, whether an improved mass transportation system or health care for senior citizens.

As a number of commentators have observed, the political crisis over the debt ceiling is a distraction from graver and more urgent problems: especially the stagnation of the economy, which is not generating enough jobs to make much of a dent in the unemployment rate or to give young workers solid footing for the beginning of their career climbs. The Great Recession, supposedly over, is threatening to turn into a Japanese-style stagnation that could endure for a decade or more.

The state of the U.S. economy is bound up with the plight of the American middle class, as Robert Reich has acutely observed. That plight has been developing for decades, a lot longer than the debt problem, which dates back just a decade, to George W. Bush’s entry into the White House. The economic gains since the 1970s have been concentrated at the top of the income distribution, in the top few percent, and little has trickled down into the middle class. One widely cited statistic has it that the top 1 percent now take home about a quarter of the national income, up from just 9 percent in 1976;  the distribution of wealth is even more unequal. (By the standard statistical measure of income inequality, the Gini coefficient, the U.S. is now considerably more unequal than any other economically developed country and more resembles a developing nation like Nicaragua.)

The lack of economic gain by the middle class has fed directly into economic stagnation. In order to keep up their standard of consumption, many families have been going deeper and deeper into debt, encouraged in the last decade by the inflation of the values of their homes. The aggregate level of household debt in relation to GDP is higher than it has been since the Depression of the 1930s and is responsible for the weak demand that is keeping the U.S. from enjoying a robust economic recovery. Robert Reich’s basic message seems fundamental:  America has prospered when its middle class has done so; but their economic situation today is parlous.

The great damage of the current conflict over the debt ceiling is that it takes place, as Gary Fine rightly points out, on the terrain of conservatives. The Tea Partiers’ strategy of intransigence has worked. Accordingly, the discussion of remedies has been narrowed to the spending side: where are the cuts going to come from? Yet it isn’t that the federal government spends so much money, anyway. In 2010, the total level of spending of all levels of government in the U.S. amounted to 40% of GDP. That tied us with Canada but placed us well behind the levels of spending in Germany (44% of GDP), the United Kingdom (47%), and France (53%), all countries less wealthy (in terms of GDP per capita) than the U.S. As I noted in an earlier post, the increases in spending at the federal level under Obama so far are in line with those under Bush, with the exception of fiscal year 2009, a year of extraordinary economic turmoil that is divided between the two Presidents.

Not fully recognized is that a fall-off in government revenue plays an outsized role in the budget deficit. In nominal dollars, federal revenues today are about where they were in 2000, which means that in real dollar terms they are down by 16 percent. As a fraction of GDP, they have dipped to a level, less than 15%, that hasn’t been seen in six decades. The Bush tax cuts are an important part of the story, and most analyses point to them as the largest single factor behind the deficit. The recession and the halting recovery have also lowered federal revenues. Obama and the Democrats are right to insist that revenue increases must be a part of any solution, but in terms of the legislation under consideration to raise the debt ceiling this time around, they have lost the argument.

(And don’t listen to the right-wing whine that the affluent already pay more than their fair share in taxes. Conveniently for their argument, conservatives mention only federal income taxes, which amount to about 40 percent of federal revenue.  Almost as much is collected through payroll taxes, which, thanks to the cap on the income subject to Social-Security taxes, are mostly paid by ordinary workers.)

The resolution of the current tempest will last only for a while, six months if the Republicans are successful, eighteen if the Democrats are. The duel will be resumed, but we now see with clarity what the positions of the two sides will be. On the right, the prime target will be the entitlement programs, Social Security and Medicare, along with Medicaid, since the retirement of the baby boom over the next quarter century will ensure that the expenditures on these programs as they are currently configured will rise massively. On the center-left, the argument will be for more balance by raising revenues, but there has already been a concession that entitlement programs need to be cut back.

Any reduction in entitlement programs is equivalent to an additional tax on the middle class and the less affluent. For instance, Social Security is fully funded through 2037 because, since the Reagan administration, workers have paid extra amounts into the trust fund to build it up for the day when the baby boomers begin to retire. (The extra payroll taxes were recycled into the federal budgets of the time and spent.) To make the payments required in coming years, Social Security will need to go beyond incoming payroll taxes and tap into these savings, which effectively means that the money comes from elsewhere. Slowing down the rate of increase in Social Security payments to retirees, a proposal part of the Obama-Boehner negotiation, will slow down this transfer process and the need for more federal revenue. It will also give the retirees measurably less money over their lifetimes.

The debt ceiling crisis has pulled apart the curtains on a Washington political class that is at an impasse, unable to strike a “grand bargain” that would take the issue off the table. A “solution” therefore awaits the 2012 election, which may prove as momentous for the nation’s course as were the elections of 1980 and 2000. The Democrats under Obama’s leadership have given up considerable ground to the Republicans. But if the Grand Old Party takes the Presidency or the Senate while retaining the House, watch out!