By Mark Schmitt

The New New Deal And The Little-Known Transformation Of American Government

August 31, 2012 3:11 pm Category: Memo Pad 9 Comments A+ / A-

The New New Deal isn’t just another book about the White House or Congress. It tells the story of what happens when laws are passed and governing begins.

What’s the best book about the Obama administration, particularly on domestic policy? A few months ago, I would have recommended Noam Scheiber’s The Escape Artists, but The New New Deal, by Michael Grunwald of Time, is not only the best book about the administration and its immediate challenges, but perhaps the only one that will (and should) continue to be read long after 2016. This post isn’t a full review of the book (for that, I recommend Michael Cohen in The Guardian, but others are forthcoming) – rather, I want to highlight two aspects of the book that both made me feel a little guilty and got me thinking.

The narrative takes place in three locations: at the White House, in Congress as it interacts with the White House over the stimulus, and deep in the executive branch of government. Grunwald is very good on the drama in the White House, as economic advisors including Larry Summers, Christina Romer, and Jared Bernstein struggled to find a formula to contain the economic disaster that was also politically viable in an environment where neither politicians nor the public fully appreciated the depth of the crisis or the logic of Keynesian stimulus. If his book has none of the contrived Oval Office melodrama of Ron Suskind’s Confidence Men, it’s because Grunwald understands the subject, and thus knows that the range of options – and the range of real disagreement — was not that wide.

He amply demonstrates that the great alternative-universe fantasy — in which the stimulus could have been much, much larger and only political malpractice held it back – is exactly that, a fantasy. The miracle is that the economic stimulus, even if inadequate to fully restore the economy’s lost output, was as large as it was, and managed to contain such a multitude of new ideas. Nonetheless, Grunwald acknowledges and digs deeply into the errors that the White House made, such as asking Romer and Bernstein to put forth a projection of unemployment rates with and without the stimulus – which may have been accurate in estimating the difference between the two, but not the overall employment picture.

The New New Deal also shines in its accounting of the legislative response, particularly the Republican opposition to the stimulus — or, more correctly, to Obama. Grunwald offers a good model for journalists that it’s possible to do more than just transcribe something like, “Senator X said he opposed the stimulus because it didn’t contain enough tax cuts and infrastructure spending.” When a politician’s stated positions make no sense and are glaringly inconsistent, a real journalist can say just that. His parsing of Senator Judd Gregg’s shifting logic on the stimulus as he flirted with becoming Obama’s Secretary of Commerce is masterful, as is his interview with former Delaware Rep. Mike Castle, a moderate Republican whose amiable rationales make even less sense than those of conservatives.

But The New New Deal made me feel guilty in two big ways. First, I’ve on occasion made the argument that progressives don’t really have an adequate set of new ideas, especially about the future of the economy. But as Grunwald shows, not only are there ideas, but many of them are being put into place as we speak, from the Race to the Top education reforms to the birth of an American solar energy and battery industries to the mundane work of weatherization of millions of homes and businesses to save energy. I didn’t fully appreciate the scope of the changes to the Unemployment Insurance system, for example. It’s far from sufficient to offset the lost potential from the recession; there’s a lot more to be done to rebuild the foundations of a broad and secure middle class, and some of it can’t be done by government. But the germ of the ideas that will build the future are there.

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Comments

  • montanabill

    “…the logic of Keynesian stimulus.”? Hey, guys watch this!

  • sigrid28

    This excellent piece provides a great reading list to turn to when the GOP’s IMAX of lying starts to wear thin. It also should give even our Trolls and Flamers hope that, after the election, the government they don’t like to admit they need may still be there, a dynamic presence for us all.

    • http://www.facebook.com/people/David-Jones/100002966416092 David Jones

      28 & author Schmitt should take up knitting!

      • sigrid28

        You should see how I knit up a storm, write books everybody uses, teach school and college, volunteer when I can, and take care of my family. How could it hurt for you to read just one of these books and expand your outlook? Surely, you can find something more constructive to do with your time than whine and toss around unoriginal insults.

        • dljones

          If your idea of this administration, with 65 days remaining, exemplifies your endorsement for the future, keep your book, don’t teach my kids, and continue living in a vacuum of failure. While you’ve been wasting your time my preference is to retrieve our freedom from 4 years of socialism.

  • onedonewong

    Barak has never even looked at the US constitution so how would he know anything about governing or getting laws passed. His way is by the Messiah Fiat

  • http://pulse.yahoo.com/_6SJHIXTNUI3LGFCQAL4BMUCCTY Theresa R

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  • http://www.facebook.com/dominick.vila.1 Dominick Vila

    I am convinced that without Bush’s TARP and Obama’s stimulus package we would have fallen into a Great Depression and there is a good chance the future of capitalism would have been questionable. The only shortcoming of the stimulus packages is the fact that it should have included more funding to invest in infrastructure modernization, development and repairs. Our power grid is in desperate need of upgrading, our levees are an embarrassment, and there are so many bridges in danger of collapse that warning signs should be posted on them to prevent looming tragedies. I suspect President Obama believed Congress would be amenable to investing in infrastructure outside the scope of the stimulus package, that was a naive assumption considering the statements and actions taken by the GOP since Inauguration Day.

  • http://www.facebook.com/people/Gary-Graves/100002694695711 Gary Graves

    I like the part where they oppose the stymlus because it doesn’t have enough tax breaks, and these people were running this country? No wonder we are in trouble.

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