Hartmann: Will Obama behave like Roosevelt or will he create a moment of opportunity for the right?
Story Transcript
PAUL JAY: Welcome to The Real News Network, coming to you from Washington, DC. We’re at the conference America’s Future Now. And I’m joined now by Thom Hartmann. He’s the host of the Thom Hartmann program, certainly one of the biggest liberal progressive radio talk shows in America, maybe the biggest. Thanks for joining us.
THOM HARTMANN: Thank you, Paul. Pleased to be here.
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JAY: So the last time we talked was a few months just before the election. And we’re talking about the progressive movement, its relationship to the Democratic Party. And you were talking about how there has to be some strategy for having more influence within the party, taking positions within the party. The Obama administration has now formed, and, certainly, with only the rarest exception, there is not very many [of] what I think people would call progressive voices in the administration, certainly not in the finance section. So what’s you’re thinking now?
HARTMANN: With regard to the Obama administration in—?
JAY: Yeah, and a longer-term view towards—. You know, this—like, I’ve been interviewing a lot of people at the conference, and it’s up to us to move Obama, it’s up to us, it’s up to us, which is very, I guess, good that it puts the emphasis on us, but nobody wants to actually say, “Well, shouldn’t Obama fulfill some of the promises he made?”
HARTMANN: Yeah, there is an element of “She shouldn’t have worn that dress,” you know, of blame the victim. And, yeah, it’s true Franklin Roosevelt wasn’t elected as a progressive, and he became one, arguably because of public pressure. Frankly, I think it was more because he was a pragmatist, and he saw that the progressive solutions were the ones that would work. And I think Obama thinks of himself as a pragmatist, and I think he thinks he’s doing the things that are going to work. But last week, you know, Louise, my wife, and I engaged in our semi-annual masochistic exercise of watching the Sean Hannity iTV show and Greta Van—you know, watching an evening of Fox News. And every single show, the two primary themes that they were hammering—I mean, just hammering—were the economy’s going to go in the tank far worse, and it’s going to be all Obama’s fault ’cause he owns it now and it’s his policies that are creating it, and we’re going to get hit again by the terrorists. And those are both bets that they can make where, if they’re wrong a year from now, nobody’ll even remember they said it, and if they’re right, a year from now the Republicans’ll take Congress, and three years from now they’ll take the White House if they are right in a big way, if they can convince enough of Americans that this is their meme, not ours. And, frankly, I think that, you know, there’s a possibility we’ll be hit again, and I think that there is a probability that the economy’s going to go in the tank. And the question is: is that going to become the conservative moment of opportunity? ‘Cause that’s what Gingrich is setting it up for right now. It’s what Hannity and, you know, O’Reilly and all these guys, they’re setting it up for. Or is it going to become the progressive moment of opportunity when Barack Obama finally begins behaving like Franklin Roosevelt?
JAY: And what would that mean? What would he do to finally behave like Roosevelt?
HARTMANN: Well, FDR drove the economy from the bottom up. He realized that an economy is made of supply and demand. Supply is called productivity, worker productivity, and demand is called wages. The thing that produces demand is wages. So you can’t have—you know, Reagan’s fantasies notwithstanding, you can’t have supply in excess of demand. You know, demand has to drive—demand pulls supply. And from literally the founding of this country until the 1980s, supply, productivity, and demand, wages, roughly tracked each other continuously. There were a few blips along the way—the Civil War, the Great Depression—but by and large they put pretty much tracked each other right up until the 1980s. And then they started splitting off quite significantly. And the reason why supply was able to continue going up even as demand leveled off was because demand driven by wages got supplemented as a consequence of Alan Greenspan’s policies with demand driven by the availability of credit. And what has happened now in the last two years is that we’ve hit the limit of our credit. And so demand can no longer be driven by credit. And, now, Roosevelt never even had that luxury of trying to drive demand with credit. He drove demand with wages. He said the government’s going to be the employer of last resort. He created the WPA and the CCC and all these other, you know, three-letter is acronym agencies that were basically the government is the employer of last resort; you’re going to have a job no matter what; it’s going to be a job that’s going to pay enough that you can actually have a home—not necessarily buy one, but you can have a home. You can put your kids through school. You can buy clothes. You can buy food. You know, we’re going to we’re going to put America back to work. And it was, you know, a really significant chunk of GDP. If you look at the spending from ’32—or ’33, really, up until ’38 or ’39, you know, it was, in today’s dollars, depending on—’37 was the aberration when it—’36 and ’37, when it dropped, but, you know, by and large, in today’s dollars, it’d be around $2-$3 trillion. Obama’s doing nothing close to that, number one. Number two, you’ve got people, even Paul Krugman, who say, well, really, the thing that finally catapulted us out of the Great Depression was World War II. And it wasn’t like a war is a great way to get out of a depression. It’s a lousy way. In fact, it’s the most inefficient form of economic stimulus, because you’re taking all this money and putting it into things that you blow up. And so, you know, for $100 million spent on bombs that get blown up, you get nowhere near the value—yeah, there’s some circulation of wages, but nowhere near the value of $100 million put into a school that lasts for 60 years. But nonetheless the financial stimulus of World War II was 120 percent of GDP. Well, you know, GDP right now is $14 trillion. So that means that we’d have to be spending $16 trillion to have the same kind of stimulus that we had as a consequence of World War II. I think if you take out the war component, the inefficiency of war, and you converted that into WPA kind of programs, they could be half of that or maybe even a third of that. We’re still talking $2 trillion, $3 trillion, $4 trillion worth of stimulus.
JAY: And I think President Obama has made it very clear he’s profoundly philosophically against this.
HARTMANN: That’s right.
JAY: He wants 90 percent of his jobs to go through the private sector, and he’s proud of that. If there was ever a golden opportunity to do what you’re saying, it’s Detroit and the auto industry, where you could actually, instead of downsizing Detroit, actually upsize Detroit as an engine of a new green transportation system. And instead they’re doing the opposite of stimulus there.
HARTMANN: Yup. And the South Koreans are doing this right now, the Japanese, both. They’re offering a multi-thousand-dollar, basically, cash payment—a tax credit is what we would call it—if you buy a new car. You know, it’s cash for trash. The Germans are doing it. There’s multiple countries around the world right now that are incentivizing people to buy cars, because it’s cheaper than bailing out their auto industries.
JAY: Well, this seems so rational and so obvious to you, and it seems so rational and obvious to me. But we’re not—people like us and this kind of point of view is not being heard, at least as far as I can tell, in the White House. So in the next segment of our interview, let’s talk about what people do about that. Please join us in the next segment of our interview with Thom Hartmann.
