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Chuck Schumer And The Democrats’ Identity Crisis: Economic Policy Vs. Rhetoric

Memo Pad Politics

Chuck Schumer And The Democrats’ Identity Crisis: Economic Policy Vs. Rhetoric


A populist message won’t be enough to save the Democratic Party if its leaders continue to serve Wall Street.

Two weeks before New York senator Charles Schumer once again delivered for Wall Street with the omnibus budget deal, he gave a major speech in which he sounded like a progressive champion. Schumer offered a stirring defense of government as the only force that can stand up to the private sector’s attack on the middle class, and argued that for Democrats to “roll to victory in 2016… First, we must convince Americans that government can be on their side and is not just a tool of special interests.”

Schumer is not just any Democrat. He led the successful election efforts for Democratic senators in 2006 and 2008, is number three in the Democratic Senate leadership, where he is responsible for policy and communications, and he sits on several of the most powerful Senate committees. His speech at the National Press Club on November 25 was billed as a major analysis of why Democrats did so badly in the midterms and how they should chart a path to victory in 2016.

Unfortunately, Schumer embodies the contradictions that will tear the Democratic Party apart over the next two years. He understands the need to embrace a populist, progressive narrative and program, but his ties to Wall Street and big money lead him to blunt any real moves by Democrats to take a bold stand for working people against corporate power.

The budget proposal to allow more government bailouts of banks that gamble with their depositors’ money was a huge lost opportunity for Democrats to paint Republicans as being on the side of the big banks that wrecked the economy. That opportunity was negated by President Obama’s pushing for the budget and Senator Schumer’s stealth maneuvers (widely known in Congress) to keep the Wall Street deal intact. As a result, the leaders of both parties demonstrated, as they’ve done before, that government is in fact on the side of the rich and powerful.

Schumer knows that this is a problem if Democrats hope to win at the polls. While his speech at the National Press Club got a lot of attention for his negative comments about the president’s strategy on the Affordable Care Act, those remarks were only a small part of a long analysis that has a lot in common with progressive views of the economy and the role of government. Some highlights:

The most salient factor in our political economy is that for the first time in American history, middle-class incomes have been in decline for over a decade… The powerful have much more access and influence over government and specific and strong actions must be taken to curb that influence so government can really represent the average person… We must illustrate that government can provide solutions by delineating specific concrete programs that if enacted would actually improve lives and incomes… We must convince the middle class that the only way out of their morass is by a stronger and effective government, not by demeaning or running from it…

When large forces harness power and push you around, you need a large after force to stand up to — to stand up for you. The only force that can give you the tools to stand up to the large tectonic forces that can mitigate the effects that technology creates on your income is an active and committed government that is on your side.

Schumer highlights the same key economic fact that progressives emphasize: wages have not kept up with productivity. But it is in his explanation of what is behind stagnant wages that he departs from progressives. For Schumer, “it can be described in one word — technology. Technology allows capital to garner [a] far greater share of increases.” He goes on to note globalization as another factor.

Schumer leaves out the powerful political forces that drove down wages. The biggest omission is his total failure to discuss the role of Wall Street in wrecking the economy and, more broadly, in driving down wages at the expense of corporate profits. Schumer, who as much as anyone in government is responsible for unleashing Wall Street, is incapable of making that case. A leading champion of banking deregulation, he has collected more than $20 million in campaign contributions from the financial sector, more than any other senator who hasn’t run for president.

And it’s not just Wall Street that Schumer leaves out of the story. It is also the corporate attack on labor unions and on labor standards.  He makes no mention of the slashing of taxes on unearned income, so that the rich pay lower taxes than the rest of us, or of the gutting of corporate tax collection. Where are the corporate villains – abetted by both political parties – who have enriched themselves at the expense of American families while driving down taxes and government investment in the public structures that are foundations of a powerful economy?

Schumer emphasizes that Democrats need a policy program to go along with their message of being on the side of the middle class, but he punts on what ideas they should propose, saying, “In the coming weeks and months we will have this debate within the Democratic Party.” Still, he declares that the Democratic program must be “attainable and effective, which means they must work politically.” That’s a recipe for more small-bore ideas, which will neither meet the big challenges facing the country nor inspire people.

In his conclusion, Schumer again asserts that what can unite Democrats “from Elizabeth Warren to Hillary Clinton to Joe Manchin” is working to “convince middle-class Americans that we are the party that will put government back on their side… and passing legislation that is effective and acutely focused on reversing the middle class decline.”

Richard Nixon’s attorney general John Mitchell famously said, “Watch what we do, not what we say.” But in today’s world of minute-to-minute coverage and social media, that isn’t so easy to pull off. CREDO Action, one of the big progressive netroots groups, immediately called out Schumer, along with President Obama and other Democrats who enabled the Wall Street budget deal.

Schumer is a brilliant politician and legislative tactician, but the reality of the corporate attack on American workers will overwhelm any messaging gloss that Democrats can put on it. He’s right; Democrats will have to take sides between working families and the middle class or the super-rich and CEO campaign contributors.

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Advisor to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

Cross-posted from the Roosevelt Institute’s Next New Deal blog.

The Roosevelt Institute is a non-profit organization devoted to carrying forward the legacy and values of Franklin and Eleanor Roosevelt.

Photo: Third Way via Flickr



  1. Dominick Vila December 23, 2014

    As hard to believe as it may seem, the rhetoric designed to deflect attention from a dismal record and lack of vision, is winning when it comes to convincing the average American that what we are experiencing is not true.
    Economic indicators produced by the same government and private sector institutions that have measured the strength or weakness of our economy in the past reporting solid growth, unemployment levels approaching full employment, a significant reduction in deficit spending, reduced borrowing, low interest rates, credit being extended to large and small businesses, as well as individuals, bankruptcies and foreclosures at normal levels, corporations posting large profits, the DOW at all time highs, gas selling at prices we have not seen since the 1990s, oil and natural gas production at levels that turned us into the highest oil producers in the world, the real estate market and new construction returning to pre-recession levels, and many other factors that confirm economic prosperity and a bright future, most Republicans remain convinced that the country is moving in the wrong direction and that economic chaos prevails.
    Very few politicians or political parties can achieve what the GOP has managed to accomplish when it comes to brainwashing. Unfortunately, the Democratic politicians whose policies and hard work contributed to the economic prosperity that should be evident to everyone, seem incapable of articulating their successes in a way the average American can understand and accept.
    When I met with a very close relative a couple of days ago and the topic of the economy came up, her answer was do you believe all those lies? The most perplexing part is that a couple of days earlier he her daughter acknowledged that she has been working a lot of overtime because her employer, a computer networking company, is having a hard time recruiting qualified people, and limiting attrition! One moment they lament being overworked, the next minute they claim people are losing their homes and earn barely enough to survive because they can’t find work as a result of Obama’s policies, and they don’t see the contradictions in their own statements.

    1. jointerjohn December 23, 2014

      Those who enjoy the power of wealth have done a very good job of training the rest of us to think only as individuals. Knowing that the working class cooperating and working together can ruin their stranglehold, they have conditioned us to eschew any organized efforts. They have demonized collective bargaining, turned conspicuous consumption into cause for adulation, and entice us to despise those in our own class who haven’t been as fortunate as we. Just look at how many Americans who are only one fast pink-slip from being out of work will vote for candidates who deny unemployment benefits and export jobs! Workers today will cross a picket line of fellow workers and spit on them as they do. They know that separate we can be picked off one-by-one, so they have coached us into becoming isolated, self-centered, and thereby powerless.

    2. charleo1 December 23, 2014

      It’s true! I was conversing with a Righty the other day on Politico (Lot’s of Righties there!) Whew! And, as you pointed out, the same doomsday rhetoric, the same claims the numbers had been skewed by Obama, and the, “Lying Liberal Press.” Can’t discount that, “Leftist Press!” That little cover-all, which they accept like the Right accepts a lot of things, as a non-debatable, given. Negates a lot of what the RW message crafters, (propagandists,) simply can’t afford to have rattling around in that echo chamber they’ve created. As far as the Democratic Party, and pols like Schumer, talking the talk, to the base, then aligning with the Republicans. The way the whole thing is being bought out, so as it will be a miracle if they all aren’t calling for a Corporate Commission to decide, “All things economic,” in a few years. Call it, “”The Protection of Prosperity for all Panel.”
      A Merry Christmas to you Dominick, and all the Vila Family!!

  2. Malcolm Powers December 23, 2014

    Is today’s liberalism really any different than its socialist ancestors?

  3. gococksri December 25, 2014

    The Biggest Lie of 2013 was not “If you like your insurance plan, you can keep it.” The Biggest Lie of 2013 was John Boehner, with a straight face, saying, “The Republican Party is the only hope for the American middle-class.”

  4. gococksri December 25, 2014

    Allow me to suggest an easy and easily-understandable read: “Winner-Take-All Politics” by Jacob Hacker and Paul Pierson. Many who read the National Memo regularly will have read it, but I heartily recommend it for those who haven’t. Co-written by two scholars who have clearly done their due diligence, it is anything but a hatchet job. It is, in reality, a long essay on the complicated intertwining of political economics, democratic economics and the markets—made less complicated by its being written for a popular audience. Filled with surprising historical references, it clarified issues for me that were in need of being clarified. As I said, it is well-done and worth the ten bucks or so you pay on Amazon.

  5. Mary Wells December 28, 2014

    Is today’s liberalism really any different than its marxist, socialist, and communist ancestors?


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