[R-G] Can Obama See the Grand Canyon?

[Anthony Fenton]

Can Obama See the Grand Canyon?
On Presidential Blindness and Economic Catastrophe
http://www.tomdispatch.com/post/174989/mike_davis_casino_capitalism_obama_and_us

By Mike Davis
15 October 2008

Let me begin, very obliquely, with the Grand Canyon and the paradox of  
trying to see beyond cultural or historical precedent.

The first European to look into the depths of the great gorge was the  
conquistador Garcia Lopez de Cardenas in 1540. He was horrified by the  
sight and quickly retreated from the South Rim. More than three  
centuries passed before Lieutenant Joseph Christmas Ives of the U.S.  
Army Corps of Topographical Engineers led the second major expedition  
to the rim. Like Garcia Lopez, he recorded an "awe that was almost  
painful to behold." Ives's expedition included a well-known German  
artist, but his sketch of the Canyon was wildly distorted, almost  
hysterical.

Neither the conquistadors nor the Army engineers, in other words,  
could make sense of what they saw; they were simply overwhelmed by  
unexpected revelation. In a fundamental sense, they were blind because  
they lacked the concepts necessary to organize a coherent vision of an  
utterly new landscape.

Accurate portrayal of the Canyon only arrived a generation later when  
the Colorado River became the obsession of the one-armed Civil War  
hero John Wesley Powell and his celebrated teams of geologists and  
artists. They were like Victorian astronauts reconnoitering another  
planet. It took years of brilliant fieldwork to construct a conceptual  
framework for taking in the canyon. With "deep time" added as the  
critical dimension, it was finally possible for raw perception to be  
transformed into consistent vision.

The result of their work, The Tertiary History of the Grand Canyon  
District, published in 1882, is illustrated by masterpieces of  
draftsmanship that, as Powell's biographer Wallace Stegner once  
pointed out, "are more accurate than any photograph." That is because  
they reproduce details of stratigraphy usually obscured in camera  
images. When we visit one of the famous viewpoints today, most of us  
are oblivious to how profoundly our eyes have been trained by these  
iconic images or how much we have been influenced by the idea,  
popularized by Powell, of the Canyon as a museum of geological time.

But why am I talking about geology? Because, like the Grand Canyon's  
first explorers, we are looking into an unprecedented abyss of  
economic and social turmoil that confounds our previous perceptions of  
historical risk. Our vertigo is intensified by our ignorance of the  
depth of the crisis or any sense of how far we might ultimately fall.

Weimar Returns in Limbaughland

Let me confess that, as an aging socialist, I suddenly find myself  
like the Jehovah's Witness who opens his window to see the stars  
actually falling out of the sky. Although I've been studying Marxist  
crisis theory for decades, I never believed I'd actually live to see  
financial capitalism commit suicide. Or hear the International  
Monetary Fund warn of imminent "systemic meltdown."

Thus, my initial reaction to Wall Street's infamous 777.7 point plunge  
a few weeks ago was a very sixties retro elation. "Right on, Karl!" I  
shouted. "Eat your derivatives and die, Wall Street swine!" Like the  
Grand Canyon, the fall of the banks can be a terrifying but sublime  
spectacle.

But the real culprits, of course, are not being trundled off to the  
guillotine; they're gently floating to earth in golden parachutes. The  
rest of us may be trapped on the burning plane without a pilot, but  
the despicable Richard Fuld, who used Lehman Brothers to loot pension  
funds and retirement accounts, merely sulks on his yacht.

Out in the stucco deserts of Limbaughland, moreover, fear is already  
being distilled into a good ol' boy version of the "stab in the back"  
myth that rallied the ruined German petite bourgeoisie to the  
swastika. If you listen to the rage on commute AM, you'll know that ? 
socialism' has already taken a lien on America, Barack Hussein Obama  
is terrorism's Manchurian candidate, the collapse of Wall Street was  
caused by elderly black people with Fannie Mae loans, and ACORN in its  
voter registration drives has long been padding the voting rolls with  
illegal brown hordes.

In other times, Sarah Palin's imitation of Father Charles Coughlin --  
the priest who preached an American Reich in the 1930s -- in drag  
might be hilarious camp, but with the American way of life in sudden  
freefall, the specter of star-spangled fascism doesn't seem quite so  
far-fetched. The Right may lose the election, but it already possesses  
a sinister, historically-proven blueprint for rapid recovery.

Progressives have no time to waste. In the face of a new depression  
that promises folks from Wasilla to Timbuktu an unknown world of pain,  
how do we reconstruct our understanding of the globalized economy? To  
what extent can we look to either Obama or any of the Democrats to  
help us analyze the crisis and then act effectively to resolve it?

Is Obama FDR?

If the Nashville "town hall" debate is any guide, we will soon have  
another blind president. Neither candidate had the guts or information  
to answer the simple questions posed by the anxious audience: What  
will happen to our jobs? How bad will it get? What urgent steps should  
be taken?

Instead, the candidates stuck like flypaper to their obsolete talking  
points. McCain's only surprise was yet another innovation in deceit: a  
mortgage relief plan that would reward banks and investors without  
necessarily saving homeowners.

Obama recited his four-point program, infinitely better in principle  
than his opponent's preferential option for the rich, but abstract and  
lacking in detail. It remains more a rhetorical promise than the  
blueprint for the actual machinery of reform. He made only passing  
reference to the next phase of the crisis: the slump of the real  
economy and likely mass unemployment on a scale not seen for 70 years.

With baffling courtesy to the Bush administration, he failed to  
highlight any of the other weak links in the economic system: the  
dangerous overhang of credit-default swap obligations left over from  
the fall of Lehman Brothers; the trillion-dollar black hole of  
consumer credit-card debt that may threaten the solvency of JPMorgan  
Chase and Bank of America; the implacable decline of General Motors  
and the American auto industry; the crumbling foundations of municipal  
and state finance; the massacre of tech equity and venture capital in  
Silicon Valley; and, most unexpectedly, sudden fissures in the  
financial solidity of even General Electric.

In addition, both Obama and his vice presidential partner Joe Biden,  
in their support for Secretary of the Treasury Paulson's plan, avoid  
any discussion of the inevitable result of cataclysmic restructuring  
and government bailouts: not "socialism," but ultra-capitalism -- one  
that is likely to concentrate control of credit in a few leviathan  
banks, controlled in large part by sovereign wealth funds but  
subsidized by generations of public debt and domestic austerity.

Never have so many ordinary Americans been nailed to a cross of gold  
(or derivatives), yet Obama is the most mild-mannered William Jennings  
Bryan imaginable. Unlike Sarah Palin who masticates the phrase "the  
working class" with defiant glee, he hews to a party line that  
acknowledges only the needs of an amorphous "middle class" living on a  
largely mythical "Main Street."

If we are especially concerned about the fate of the poor or  
unemployed, we are left to read between the lines, with no help from  
his talking points that espouse clean coal technology, nuclear power,  
and a bigger military, but elide the urgency of a renewed war on  
poverty as championed by John Edwards in his tragically self- 
destructed primary campaign. But perhaps inside the cautious candidate  
is a man whose humane passions transcend his own nearsighted centrist  
campaign. As a close friend, exasperated by my chronic pessimism,  
chided me the other day, "don't be so unfair. FDR didn't have a nuts  
and bolts program either in 1933. Nobody did."

What Franklin D. Roosevelt did possess in that year of breadlines and  
bank failures, according to my friend, was enormous empathy for the  
common people and a willingness to experiment with government  
intervention, even in the face of the monolithic hostility of the  
wealthy classes. In this view, Obama is MoveOn.org's re-imagining of  
our 32nd president: calm, strong, deeply in touch with ordinary needs,  
and willing to accept the advice of the country's best and brightest.

The Death of Keynesianism

But even if we concede to the Illinois senator a truly Rooseveltian  
or, even better, Lincolnian strength of character, this hopeful  
analogy is flawed in at least three principal ways:

First, we can't rely on the Great Depression as analog to the current  
crisis, nor upon the New Deal as the template for its solution.  
Certainly, there is a great deal of déjà vu in the frantic attempts to  
quiet panic and reassure the public that the worst has passed. Many of  
Paulson's statements, indeed, could have been directly plagiarized  
from Herbert Hoover's Secretary of the Treasury Andrew Mellon, and  
both presidential campaigns are frantically cribbing heroic rhetoric  
from the early New Deal. But just as the business press has been  
insisting for years, this is not the Old American Economy, but an  
entirely new-fangled contraption built from outsourced parts and  
supercharged by instantaneous world markets in everything from dollars  
and defaults to hog bellies and disaster futures.

We are seeing the consequences of a perverse restructuring that began  
with the presidency of Ronald Reagan and which has inverted the  
national income shares of manufacturing (21% in 1980; 12% in 2005) and  
those of financial services (15% in 1980; 21% in 2005). In 1930, the  
factories may have been shuttered but the machinery was still intact;  
it hadn't been auctioned off at five cents on the dollar to China.

On the other hand, we shouldn't disparage the miracles of contemporary  
market technology. Casino capitalism has proven its mettle by  
transmitting the deadly virus of Wall Street at unprecedented velocity  
to every financial center on the planet. What took three years at the  
beginning of the 1930s -- that is, the full globalization of the  
crisis -- has taken only three weeks this time around. God help us,  
if, as seems to be happening, unemployment tops the levees at anything  
like the same speed.

Second, Obama won't inherit Roosevelt's ultimate situational advantage  
-- having emergent tools of state intervention and demand management  
(later to be called "Keynesianism") empowered by an epochal uprising  
of industrial workers in the world's most productive factories.

If you've been watching the sad parade of economic gurus on McNeil- 
Lehrer, you know that the intellectual shelves in Washington are now  
almost bare. Neither major party retains more than a few enigmatic  
shards of policy traditions different from the neo-liberal consensus  
on trade and privatization. Indeed, posturing pseudo-populists aside,  
it is unclear whether anyone inside the Beltway, including Obama's  
economic advisors, can think clearly beyond the indoctrinated mindset  
of Goldman Sachs, the source of the two most prominent secretaries of  
the treasury over the last decade.

Keynes, now suddenly mourned, is actually quite dead. More  
importantly, the New Deal did not arise spontaneously from the  
goodwill or imagination of the White House. On the contrary, the  
social contract for the post-1935 Second New Deal was a complex,  
adaptive response to the greatest working-class movement in our  
history, in a period when powerful third parties still roamed the  
political landscape and Marxism exercised extraordinary influence on  
American intellectual life.

Even with the greatest optimism of the will, it is difficult to  
imagine the American labor movement recovering from defeat as  
dramatically as it did in 1934-1937. The decisive difference is  
structural rather than ideological. (Indeed, today's union movement is  
much more progressive than the decrepit, nativist American Federation  
of Labor in 1930.) The power of labor within a Walmart-ized service  
economy is simply more dispersed and difficult to mobilize than in the  
era of giant urban-industrial concentrations and ubiquitous factory  
neighborhoods.

Is War the Answer?

The third problem with the New Deal analogy is perhaps the most  
important. Military Keynesianism is no longer an available deus ex  
machina. Let me explain.

In 1933, when FDR was inaugurated, the United States was in full  
retreat from foreign entanglements, and there was little controversy  
about bringing a few hundred Marines home from the occupations of  
Haiti and Nicaragua. It took two years of world war, the defeat of  
France, and the near collapse of England to finally win a majority in  
Congress for rearmament, but when war production finally started up in  
late 1940 it became a huge engine for the reemployment of the American  
work force, the real cure for the depressed job markets of the 1930s.  
Subsequently, American world power and full employment would align in  
a way that won the loyalty of several generations of working-class  
voters.

Today, of course, the situation is radically different. A bigger  
Pentagon budget no longer creates hundreds of thousands of stable  
factory jobs, since significant parts of its weapons production is now  
actually outsourced, and the ideological link between high-wage  
employment and intervention -- good jobs and Old Glory on a foreign  
shore -- while hardly extinct is structurally weaker than at any time  
since the early 1940s. Even in the new military (largely a hereditary  
caste of poor whites, blacks, and Latinos) demoralization is reaching  
the stage of active discontent and opening up new spaces for  
alternative ideas.

Although both candidates have endorsed programs, including expansion  
of Army and Marine combat strength, missile defense (aka "Star Wars"),  
and an intensified war in Afghanistan, that will enlarge the military- 
industrial complex, none of this will replenish the supply of decent  
jobs nor prime a broken national pump. However, in the midst of a deep  
slump, what a huge military budget can do is obliterate the modest but  
essential reforms that make up Obama's plans for healthcare,  
alternative energy, and education.

In other words, Rooseveltian guns and butter have become a  
contradiction in terms, which means that the Obama campaign is  
engineering a catastrophic collision between its national security  
priorities and its domestic policy goals.

The Fate of Obama-ism

Why don't such smart people see the Grand Canyon?

Maybe they do, in which case deception is truly the mother's milk of  
American politics; or perhaps Obama has become the reluctant prisoner,  
intellectually as well as politically, of Clintonism: that is say, of  
a culturally permissive neo-liberalism whose New Deal rhetoric masks  
the policy spirit of Richard Nixon.

It's worth asking, for instance, what in the actual substance of his  
foreign policy agenda differentiates the Democratic candidate from the  
radioactive legacy of the Bush Doctrine? Yes, he would close  
Guantanamo, talk to the Iranians, and thrill hearts in Europe. He also  
promises to renew the Global War on Terror (in much the same way that  
Bush senior and Clinton sustained the core policies of Reaganism,  
albeit with a "more human face").

In case anyone has missed the debates, let me remind you that the  
Democratic candidate has chained himself, come hell or high water, to  
a global strategy in which "victory" in the Middle East (and Central  
Asia) remains the chief premise of foreign policy, with the Iraqi- 
style nation-building hubris of Dick Cheney and Paul Wolfowitz  
repackaged as a "realist" faith in global "stabilization."

True, the enormity of the economic crisis may compel President Obama  
to renege on some of candidate Obama's ringing promises to support an  
idiotic missile defense system or provocative NATO memberships for  
Georgia and Ukraine. Nonetheless, as he emphasizes in almost every  
speech and in each debate, defeating the Taliban and Al-Qaeda,  
together with a robust defense of Israel, constitute the keystone of  
his national security agenda.

Under huge pressure from Republicans and Blue Dog Democrats alike to  
cut the budget and reduce the exponential increase in the national  
debt, what choices would President Obama be forced to make early in  
his administration? More than likely comprehensive health-care will be  
whittled down to a barebones plan, "alternative energy" will simply  
mean the fraud of "clean coal," and anything that remains in the  
Treasury, after Wall Street's finished its looting spree, will buy  
bombs to pulverize more Pashtun villages, ensuring yet more  
generations of embittered mujahideen and jihadis.

Am I unduly cynical? Perhaps, but I lived through the Lyndon Johnson  
years and watched the War on Poverty, the last true New Deal program,  
destroyed to pay for slaughter in Vietnam.

It is bitterly ironic, but, I suppose, historically predictable that a  
presidential campaign millions of voters have supported for its  
promise to end the war in Iraq has now mortgaged itself to a "tougher  
than McCain" escalation of a hopeless conflict in Afghanistan and the  
Pakistani tribal frontier. In the best of outcomes, the Democrats will  
merely trade one brutal, losing war for another. In the worst case,  
their failed policies may set the stage for the return of Cheney and  
Rove, or their even more sinister avatars.

Mike Davis is the author of In Praise of Barbarians: Essays Against  
Empire (Haymarket Books, 2008) and Buda's Wagon: A Brief History of  
the Car Bomb (Verso, 2007). He is currently working on a book about  
cities, poverty, and global change. You can listen to a podcast of  
Davis discussing why the New Deal isn't relevant as a solution today  
by clicking here.http://tomdispatch.blogspot.com/2008/10/interview-with-mike-davis-contributor.html