Fed Up with Wall Street, Democrats Look to the Left

 Harold Meyerson

The Democratic Party's romance with Wall Street may finally be breaking up. In the past 10 days, a diverse group of Democratic senators scuttled Larry Summers's candidacy  for Federal Reserve chair and New York Democrats voted for the mayoral candidate  whose campaign was an attack on Michael Bloomberg's care and feeding of the super-rich at the expense of the rest of the city. Former commerce secretary (and JP Morgan Chase executive) William Daley's surprise withdrawal  from the Illinois Democratic gubernatorial primary is one more indication of Wall Street's diminished sway.

Democrats have reached a watershed. After two decades in which the party has moved leftward on social issues but has largely accepted the financial sector's economic preferences - for smaller government; a greater role for markets; and reduced regulation, particularly of finance - the abject failures of the market economy are pushing the party leftward. 

The revolt against Summers was less about his positions on today's economic issues than his adamant opposition to regulating derivatives [6] during his tenure as Bill Clinton's Treasury secretary, when he invoked as an argument against such oversight the dismay of the big banks at the one set of regulations that might have staved off, or at least diminished, the Great Recession of the past five years.

In a broader sense, Democrats' turn against Summers signals both a weariness and a repudiation of Rubinomics and its apostles. Ever since he became the head of Clinton's economic council, and then Treasury secretary, former Goldman Sachs co-chairman Robert Rubin  has been the party establishment's foremost economic guru, and his proteges - including Summers, former Treasury secretary Tim Geithner and White House economic counselor Gene Sperling - have dominated policymaking. During their reign, they successfully campaigned for the repeal of the Glass-Steagall Act  (which had separated commercial from investment banking), the decision not to regulate derivatives, the trade deals with China and Mexico that decimated U.S. manufacturing and a post-2008 bailout that pumped more than a trillion dollars into the banks but never compelled - or even persuaded - the banks to use those public funds to help small businesses or homeowners facing foreclosure. They blocked efforts to create a safer, more consumer-friendly economy by women more prescient but less powerful than they - Brooksley Born, who headed the Commodity Futures Trading Commission under Clinton and sought to regulate derivatives, and Elizabeth Warren, who conceived the Consumer Financial Protection Bureau but was precluded from heading it.

Today, it's Warren, now the senior senator from Massachusetts and the party's leading critic of Wall Street, who is riding high. So is Bill de Blasio, the presumptive favorite to succeed Bloomberg as mayor of New York. In his primary campaign, de Blasio excoriated Bloomberg for helping transform what had once been a metropolis of thriving small businesses and free higher education into a city where the gap between the rich and everyone else has reached levels seen only in the least-developed nations. The New York Times' precinct breakdown of last week's Democratic primary shows that de Blasio ran first or second in every one of New York's hundreds of neighborhoods, save only the Upper East Side between Fifth and Park Avenues and 59th and 90th Streets - where New York City's wealthiest live.

These events portend a growing conflict between those Democrats who have hitched their wagons to Wall Street - among them soon-to-be New Jersey senator Cory Booker and Chicago Mayor Rahm Emanuel (about whom the ominously titled biography "Mayor 1 Percent" is forthcoming) - and those, like Warren and her Senate colleagues Sherrod Brown (Ohio) and Jeff Merkley (Ore.), who believe government's role is in advancing the interests of the middle class and protecting it from finance.

As Peter Beinart demonstrated in a brilliant essay last week , what Warren & Co. have going for them is millennials' pervasive disenchantment with the market economics that have plunged them into a nightmare of unemployment and undercompensation. Millennials have suffered mightily from the withdrawal of government support for higher education, from the offshoring of jobs and government's failure to directly create the jobs that might take their place. Polling shows that they're the one generation that overwhelmingly supports Obamacare  and a bigger government that provides more services. They clearly have no use for Rubinomics - something that Hillary Clinton would do well to realize should she seek to become the 2016 standard-bearer of what is fast becoming a more progressive Democratic Party.

Meyerson.jpegHarold Meyerson is editor-at-large of The American Prospect and a Washington Post columnist. He is a Vice Chair of DSA.

Individually signed posts do not necessarily reflect the views of DSA as an organization or its leadership.

Film Discussion: When Abortion Was Illegal

March 26, 2017
· 13 rsvps

Directed by Dorothy Fadiman, When Abortion Was Illegal (1992, nominated for an Academy Award, Best Documentary Short Subject) reveals through first-person accounts the experiences of women seeking abortion before the Supreme Court legalized abortion in Roe v. Wade in 1973. We are one Supreme Court nominee away from a return in many states to back-alley abortions. Join Amanda Williams, Executive Director of the Lilith Fund, to discuss challenges to reproductive justice and abortion access. (Lilith Fund funds abortions for women in need in the Central and South Texas area.) Learn about how to participate in April Bowl-A-Thons to raise funds for low-income women. View the film here for free before the discussion. 8 ET/7 CT/6 MT/5 PT.

DSA New Member Orientation Call

March 30, 2017
· 39 rsvps

You've joined DSA - Great. Now register for this New Member Orientation call and find out more about our politics and our vision.  And, most importantly, how you can become involved.  9:30 PM ET; 8:30 PM CT; 7:30 PM MT; 6:30 PM PT.

LGBT Activism: A Brief History with Thoughts about the Future

April 01, 2017
· 50 rsvps

Historian John D'Emilio's presentation will do 3 things: Provide a brief explanation of how sexual and gender identities have emerged; provide an overview of the progression of LGBT activism since its origins in the 1950s, highlighting key moments of change; and, finally, suggest what issues, from a democratic socialist perspective, deserve prioritizing now. John co-authored Intimate Matters: A History of Sexuality in America, which was quoted by Supreme Court Justice Anthony Kennedy in the 2003 Lawrence v. Texas decision that ruled state sodomy laws unconstitutional. 1 pm ET; 12 pm CT; 11 am MT; 10 am PT.

  1. This webinar is free for any DSA member in good standing.
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  4. If you have questions, contact Peg Strobel, peg.strobel@sbcglobal.net.
  5. If you have technical questions, contact Tony Schmitt, schmittaj@gmail.com, 608-355-6568.

Film Discussion: Documentaries of People's History in Texas

April 02, 2017
· 30 rsvps

Join DSA members Glenn Scott and Richard Croxdale to discuss videos produced by People’s History in Texas (PHIT), a project that brings to life the stories of ordinary people in significant socio-political movements in Texas. They will discuss The Rag, their newest documentary, which tells the story of an influential underground paper based in Austin, Texas, from 1966-77. Click here to view Part I (the early years as an all-volunteer paper covering the student, anti-Vietnam and Civil Rights movements), Part II (the impact of Women’s Liberation on the paper) and Part III (building community: covering local politics, nukes, co-ops, feminist institutions). But also check out the video on the Stand-Ins about a group of university students who led a movement to desegregate Austin’s movie theaters in 1961. 8 ET/7 CT/6 MT/5 PT. Here's a blog post about PHIT.

Introduction to Democratic Socialism

April 04, 2017
· 53 rsvps

Join Rahel Biru, NYC DSA co-chair, and Joseph Schwartz, DSA Vice-Chair, on this webinar for an overview of what we in Democratic Socialists of America mean when we talk about "socialism," "capitalism" and the goals of the socialist movement.  9 PM ET; 8 PM CT; 7 PM MT; 6 PM PT.

  1. This webinar is free for any DSA member in good standing.
  2. You need a computer with good internet access.
  3. Your computer must have headphones (preferred) or speakers; you can speak thru a mic or use chat to "speak".
  4. If you have questions, contact Joseph Schwartz, schwartzjoem@gmail.com.
  5. If you have technical questions, contact Tony Schmitt, schmittaj@gmail.com, 608-355-6568.

What Is DSA? Training Call

April 05, 2017

If you're a new DSAer, have been on a new member call, but still have questions about DSA's core values/strategy/core work and how to express these ideas in an accessible way to the media, as well as to friends, family and others who might be interested in joining DSA, this call is for you. 

We will talk through the basics of DSA's political orientation and strategy for moving toward democratic socialism, and also have call participants practice discussing these issues with each other. By the end of the call you should feel much more comfortable thinking about and expressing what DSA does and what makes our organization/strategy unique. 8 pm ET; 7 pm CT; 6 pm MT; 5 pm PT. 70 minutes.

Feminist Working Group

April 12, 2017
· 15 rsvps

People of all genders are welcome to join this call to discuss DSA's work on women's and LGBTQ issues, especially in light of the new political reality that we face after the elections.  9 pm ET; 8 pm CT; 7 pm MT; 6 pm PT.

DSA New Member Orientation Call

April 16, 2017
· 6 rsvps

You've joined DSA - Great. Now register for this New Member Orientation call and find out more about our politics and our vision.  And, most importantly, how you can become involved.  8 pm ET; 7 pm CT; 6 pm MT; 5 pm PT.