the national interest

Biden’s FDR-size Bet

President Biden on July 15. Photo: SAUL LOEB/AFP via Getty Images

Harry Hopkins, a close adviser to Franklin Roosevelt, is said to have summarized the administration’s political strategy like so: “We shall tax and tax, and spend and spend, and elect and elect.” It worked quite well for the Democrats, well past FDR’s time. But around the mid-1960s, as the taxes began to bite into middle-class wallets, and many white voters came to see the spending as benefiting people who didn’t look like them, the formula stopped working. At some point, “tax and spend” became a hackneyed insult of the Democratic agenda, with the third part — “elect” — dropped from the mantra.

Biden’s ambition for an FDR-size presidency died November 3, when the election delivered a narrow governing margin in Congress that seemed to bode a Clinton- or Carter-size presidency instead. But the goal of an FDR-style presidency — shaped along the same contours, though smaller in scale — remains very much alive. That ambition came into its clearest view on July 13, when Senate Democrats announced their more or less unified support for a hugely ambitious domestic-spending package. It would come in at roughly $3.5 trillion, minus the normal congressional haggling down of the price. Tax, spend, elect.

The precise contents of the bill have yet to take final form. In general, though, it will include a clean-electricity standard and deployment of green technology, expansions for Medicaid and Medicare, subsidies for child care and community college, and a $300-per-month child tax credit. It will, in other words, be a big climate plan, a big health-care plan, a big education plan, and a big social-policy plan all wrapped in a single package. At first blush, the sheer size of the bill might appear like a political liability — how does Biden get every single Democratic senator, and almost every single House Democrat, to vote for the same thing, especially when the most moderate members are afraid to be seen as too liberal?

As it turns out, the sheer size creates a kind of protection by reducing Biden’s agenda to a single vote. Some moderate Democrats from conservative states or districts might wish to position themselves to the administration’s right, but none of them can afford to let Biden’s presidency come crashing down in Congress. Perhaps the most important clue to the president’s fate came from Joe Manchin, the most conservative Democrat in Congress, who said in January, “We’re going to make Joe Biden successful.” The worst possible outcome for any Democrat — the opening that will let the Republican Party back into power — would be for their party to be seen as having failed at governing. They can and will negotiate the parameters, but the only leverage they hold is mutually assured destruction.

Democratic moderates traditionally worry that their party will overreach and alienate conservative-leaning voters they need. That fear is not irrational. There are plenty of elements of the Democratic program that don’t play in Peoria. This is especially true of the left-wing rhetoric that conservatives are so skillful at plucking out of progressive hothouses and introducing into the national media. But the Democratic megabill ought to be able to steer clear of the culture wars (though Republicans will try very hard to stoke them anyway). Its primary ambitions are concrete benefits with broad constituencies: enhanced payments for families with children; expanded Medicare benefits covering dental, hearing, and eyeglasses. One poll found that the expanded Medicare package commands the support of 83 percent of the public.

Building a bill out of popular elements does not guarantee people will like it. The Affordable Care Act provides the classic cautionary tale: Even though nearly every single element in it commanded strong public support, most Americans said they opposed “Obamacare,” which came to signify in the public mind something different and scarier than its component parts. One reason is that months and months of fruitless negotiations gave the impression that the program was a mess. Another is that Congress built in a several-year delay for the law’s main functions to start working. Obamacare eventually did win majority support, but only after Republicans tried to abolish it.

Democrats in Congress appear to have learned the lesson. They are not bothering to engage in Potemkin negotiations with Republicans whose only goal is to take up time and gum up the works. Nor will they make the mistake of letting years pass before voters taste the fruits of Congress’s labor. The checks to parents, the first year of which was seeded in Biden’s quickly passed pandemic-rescue bill in March, are already going out the door. The Medicare benefits ought to begin swiftly enough for Democrats to actually have something to run on in the midterm elections.

The right will complain about Democrats jamming through a huge expansion in government. But the source of their panic is not that the public rejects these proposals. Biden’s spending will “be popular with a large group of Americans,” complains an editor at the conservative Washington Times. His policies “will be politically impossible to reform or repeal,” predicts the Wall Street Journal editorial page. Republicans are unnerved by Biden’s proposals precisely because they suspect Americans will like them.

The beauty part of the deal, parts of which must be fully paid for under parliamentary rules, is that Democrats can finance all these goodies exclusively by raising taxes on the rich. This reflects a structural reality of American politics and the economy: Because the rich have gained so much wealth over the last generation, and because Republicans have worked so maniacally to reduce their taxes, there’s a ton of money waiting to be claimed simply by taxing them at reasonable levels.

Biden campaigned on a plan to raise $4 trillion over the next decade by taxing corporations, heirs, and households earning $400,000 a year or more. Not only do serious center-left economists think he can do this without creating a significant economic drag, so do serious center-right economists. Republican economist Douglas Holtz-Eakin calculates Biden’s tax hikes will shave a minuscule 0.2 percent off GDP over the long run. The American Enterprise Institute pegs the economic cost slightly lower. That is a tiny, almost imperceptible cost to growth when measured against the enormous social and economic benefits of the healthier, better-educated, and less-polluted economy it would finance.

The political opportunity this presents Democrats is irresistible: They can shower benefits on 99 percent of the public and offload the cost onto one percent. The only catch is that the one percent hold disproportionate sway — not only with Republicans, who categorically refuse to raise their taxes a single dime for any reason, but to a degree among Democratic moderates, who have made fretful noises about the dangers of taxing corporations too heavily. Since every dollar in social spending has to be paid for with a dollar in new taxes on the rich, the size of the final Democratic bill will boil down to moderates listening to the economists and the pollsters and not the guy in the polo shirt who sidled up to them at their last fund-raiser to whine about the capital-gains tax.

The final, and perhaps most powerful, centripetal force holding together the Democrats is Donald Trump. The self-styled president-in-exile looms over everything they do. As they make use of their narrow window to govern, he is laying the groundwork for a possible second run.

The best defense they have against a repeat Trump challenge (backed by a more uniformly anti-democratic Republican Party) is a popular and successful Biden presidency. That objective is lurking in Biden’s mind when he invokes Roosevelt. FDR remade the role of the government, but his purpose in doing so was to preserve capitalism and democracy from radical threats. Against Trump’s campaign of confusion and hate, Biden’s party can offer concrete material benefits. Capitalism may not require saving at the moment, but democracy does.

Biden’s FDR-size Bet