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The Next New Deal

The huge opportunities—and huge risks—of a possible Obama administration.

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Evansville, Indiana.  

On a bright, brisk, fat-pumpkin morning in mid-October—the kind of morning you would call glorious were the economy not cratering, the financial system not imploding, the Dow not tumbling at this very moment to its lowest depths in more than five years—Barack Obama is on the courthouse steps in Chillicothe, Ohio, calmly and coolly enlisting the past in the service of claiming the future. “The American story has never been about things coming easy,” Obama declares. “It’s been about rising to the moment when the moment is hard … about rejecting panicked division for purposeful unity; about seeing a mountaintop from the deepest valley. That’s why we remember that some of the most famous words ever spoken by an American came from a president who took office in a time of turmoil: ‘The only thing we have to fear is fear itself.’ ”

Obama had been toying with vague FDR allusions for the past three days, but now he’s decided to lay his cards on the table and seize the mantle explicitly. With the specter of a full-blown depression looming, the Age of Roosevelt—the campaign he ran in 1932, the challenges he faced upon assuming office, the “bold, persistent experimentation” he called for and the New Deal edifice he erected in response—is much on the minds of the nominee and his inner circle. “A lot of people around Barack are reading books about FDR’s first hundred days,” says a member of Obama’s kitchen cabinet. “It’s a sign of the shift that’s going on emotionally: from being on this improbable mission to believing, Hey, we’re going to win.

Until recently, talk like that would have brought forth invocations of unhatched chickens from countless Democrats. From the moment it became clear last spring that Obama would be the party’s standard-bearer, the excitement over what he represented has been twinned with a gnawing dread that his astonishing ride would somehow come to a crashing end a few yards short of the White House. That America would prove unready to elect a black president. That the Republicans would once again work their voodoo on the electorate. Or that Obama would choke in the clutch—that, far from being the next FDR or JFK, he would turn out to be the reincarnation of George McGovern or Mike Dukakis or John Kerry.

But as the outcome of the race has begun to seem more certain with each passing day—with Obama’s lead in the polls healthy and showing few signs of diminishing, with John McCain’s campaign listing aimlessly and lapsing into rank self-parody, with Sarah Palin devolving into a human punch line—Democrats are slowly, haltingly allowing themselves to believe that victory is truly within their grasp, and hence to contemplate what comes next. Transition. Inauguration. Those first hundred days. Maybe even, perchance, with augmented majorities for the party in both the House and Senate all but in the bag, the dawning of a spanking-new era of Democratic dominion.

It requires no prodigious feat of memory, of course, to see how this dream could come a cropper. Back in 1993, Bill Clinton surfed into Washington on a similar wave of enthusiasm and expectation. Democrats then, too, controlled both the upper and lower chambers on Capitol Hill. The party’s agenda was bold, ambitious, far-reaching. And then everything fell to pieces. In something like a heartbeat, Clinton’s reputation as a Third Way centrist was reduced to rubble. The degree of Democratic political malpractice was so severe that it enabled the GOP, in 1994, to snatch the reins of the House and Senate simultaneously for the first time in four decades.

This precedent would be unnerving enough for Democrats by itself, but the truth is that the circumstances Obama will confront are infinitely more daunting than those that Clinton faced at the outset of his administration. The recession that facilitated 42’s rise was shallow, and by the time he took office, it was already in the rearview mirror. And although the mounting deficit compelled Clinton to abandon much of the new spending he’d envisioned, the fiscal situation he inherited was nothing like the house of horrors awaiting Obama. Add to that the collapsing real-estate market, the credit crunch, a weak dollar, and rising unemployment, and Obama will find himself staring down the barrel of a downturn so steep and ugly that it could easily consume his whole first term. Oh, and did I forget to mention that the country is at war—in not one but two countries?

All too aware that, should he win, these cascading crises will leave Obama with no time to gain his sea legs and terrifyingly little margin for error, he and his people, to a degree few realize, have been planning their transition from campaigning to governing for months with characteristic care and rigor. Like so much about Obama’s historic bid for the presidency, the first few days and weeks and months will be like nothing we have seen before—and all of it grounded in the insight that, mind-boggling as it might sound, winning was the easy part. These are Democrats they’ll be dealing with, after all.


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