As the Obama era comes to a close, one question before the Democratic Party is how it ought to regard business. Barack Obama has spent most of his presidency rebutting the accusation that he is a crypto-socialist. “Obama’s Radicalism Is Killing the Dow,” blared the headline of Stanford economist and respected Republican functionary Michael J. Boskin’s March 6, 2009, Wall Street Journal op-ed. The Dow has nearly tripled since then, and while Republicans have dramatically reduced the volume and frequency with which they express their belief that Obama’s insidious socialist agenda is strangling prosperity, they never reconsidered it. Over the last year or so, however, the Bernie Sanders campaign subjected Obama to roughly the opposite critique — that his tepid acquiescence to rampant capitalism has permitted the corporate elite to trample the public interest.
In their surface aspects, the policy agendas proposed by Obama (and Hillary Clinton, his all-but-designated successor) bear a superficial resemblance to Sanders’s program. The liberal Obama-Clinton wing, like the democratic-socialist Sanders wing, would increase the minimum wage and Social Security benefits for low-income workers, increase taxes on the rich, tighten regulations on Wall Street, and invest heavily in public infrastructure. Liberals and socialists disagree on more than just the scope of change, though. The philosophical disagreement runs deep — nearly as deep as that between Obama and his right-wing opponents. Obama’s recent interview with Bloomberg Businessweek provides fresh insight into a worldview that, for all the party’s efforts to paper over the distinctions, is utterly foreign to Sanders.
Obama believes better policies can create more economic growth. (“I do believe we can grow a lot faster than we’re growing right now.”) More growth means more income for everybody — gains for the poor don’t need to come entirely at the expense of the rich.
Sanders, on the other hand, presents the political struggle as a zero-sum conflict. He sees economic growth as almost irrelevant:
The whole size of the economy and the GDP doesn’t matter if people continue to work longer hours for low wages and you have 45 million people living in poverty. You can’t just continue growth for the sake of growth in a world in which we are struggling with climate change and all kinds of environmental problems. All right? You don’t necessarily need a choice of 23 underarm spray deodorants or of 18 different pairs of sneakers when children are hungry in this country.
Obama does not believe the rich and the non-rich have identical interests, but he does see their interests as overlapping. In Sanders’s view, American society is riven by a zero-sum conflict between the ruling class and everybody else. Class, in his telling, means far more than a rough description for a person’s income or level of social need. It is the singular prism through which Sanders views politics. He does not merely argue that people with different incomes have different economic interests. He treats class as the fundamental identity in American society. Sanders describes what he calls “the billionaire class” or “the one percent” — terms he uses interchangeably — as locked in a death struggle against the vast majority of the populace. Obama argues against right-wing economic ideas, while Sanders tends to dispense with the ideas and focus on what he identifies as the self-interest behind it: “a ruling class whose greed is destroying our nation. The billionaire class cannot have it all. Our government belongs to all of us, and not just the one percent.”
The difference between these two modes of thought is not merely abstract. Sanders conceives of the conflict as one pitting opposing classes in irresolvable conflict. The billionaire class controls the political system in order to protect its own self-interest, and the only answer is a “revolution” that renders this class economically and politically impotent. Because Obama identifies his adversary as a set of ideas rather than a class, he sees it not so much as venal but as misguided.
The main theme of Obama’s Bloomberg Businessweek interview is that his policy goals dovetail with a longer-term and more enlightened understanding of corporate America’s self-interest. Obama uttered a version of this belief in the 2008 campaign, when he told an Ohio man, “I think when you spread the wealth around, it’s good for everybody.” That belief was considered so dangerously radical that it became a first-order campaign gaffe (and launched his interlocutor, “Joe the Plumber,” into minor fame and a political career). The controversial element of the remark was Obama’s endorsement of “spread[ing] the wealth around,” but this was merely a slightly impolitic expression of a long-standing Democratic belief in a more progressive tax and transfer policy. It is the other half of Obama’s statement, that more redistribution is good for everybody, that sets him apart from Sanders.
In his interview, Obama concedes that Wall Street resents his regulation of the financial industry, and concedes that it has reduced the industry’s profitability (which it demonstrably has). Nonetheless, Obama argues that the increased stability of the financial system is good not only for business overall but for the financial system, too:
When we put forward regulations that make mortgages simpler and more intelligible to consumers, that may be bad for somebody’s short-term bottom line—if their business model is built on pushing out shaky loans to consumers. But it will actually be good for the housing market and for the financial system as a whole if people know what they’re buying and they can afford the mortgages they take on.
Obama likewise extends the case to higher wages:
You know, if I am a CEO in a boardroom right now, I should be thinking about, how do I make sure my workers are making a decent wage? And if I’m a shareholder, that is something I should be paying attention to, too, because if you’re not, that’s when you start getting the kinds of political pushback that you’re seeing here in the United States. That’s how you start getting a Brexit campaign. Over time, you’ll strangle this goose that’s been laying you all these golden eggs. Share the eggs.
In Obama’s telling, his opponents are foolishly greedy, defending their short-term interests at the expense of their long-term interests. In Sanders’s telling, they are shrewdly and correctly greedy.