Obama and Miliband

I apologise for the advertisement, but there is a piece in the Observer that is well worth reading. Michael Cohen describes how Obama has tired of offering the hand of friendship, only for the Republicans to accuse him of being a socialist Mau Mau on a mission to destroy America. He will abandon bipartisanship and fight the 2012 presidential election as Harry Truman and FDR would have done: by painting the Republicans as the yapping lapdogs of the Wall Street plutocracy. Cohen reports that in a recent speech:

‘Obama blasted Republicans for possessing a world view where “corporations write their own rules, and we dismantle environmental regulations and we dismantle labour regulations, and we cut taxes for folks who don’t need it and weren’t even asking for it, and then we say to you, you’re on your own – good luck, because you’re not going to get any help”. According to Obama, such an approach would “fundamentally cripple America”. And like Truman, Obama is proudly portraying himself as the defender of the middle class: “If asking a billionaire to pay the same tax rate as a plumber or teacher makes me a class warrior… I will wear that charge as a badge of honour.”’

Whether turning on Wall Street will help Obama win is an open question. His limp professorial style and the failure of his economic policy ought to guarantee defeat. But the American Right shoots itself in the foot so often it should be on crutches. If it cannot or will not put forward a respectable centrist Republican, or if the only respectable candidate it can offer is the dull Romney, Obama is in with a chance not only of re-election but of helping Ed Miliband.

The reaction to the Labour leader’s conference speech is one of the strangest sights I have seen in many years. Granted that much of the public think Miliband a geek, and that his tight election made him a leader with precious little legitimacy, but the contempt that greeted his unexceptional remarks remains extraordinary. In a moderate manner, Miliband told a truth about Britain. For a generation we have been told that we must let the financial markets rip because they allow the creation of wealth. Now the markets have collapsed, and the richest people in the country have turned to the taxpayer and demanded and received a bailout, the old wisdom no longer applies. Yet when Miliband states the obvious, he is derided.

There are I think three reasons why politicians and journalists want nothing to do with Miliband’s ideas.

1) They think the bailout of 2008 was a one off, and tweaks to the regulatory system will solve the systemic faults in the banking system.

2) They know that the bailout was not a one off, and that financial services will be privatizing profits and nationalizing debts for years. Nevertheless they conclude that the City is so important to Britain, it cannot be challenged. Like it or not we are stuck with state-subsidised crony capitalism that cannot be reformed for fear of the consequences.

3) They believe that the electorate will never buy a leftish shift in economic policy.  Truman and Roosevelt are figures from another age. Those who hanker for the economic populism of the 1930s and 1940s do not understand the modern world.

If Obama were to win on an anti-Wall Street ticket in 2012, the last of those arguments would look threadbare and Ed Miliband would look a good deal better than he looks at the moment.