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DOJ’s Clear Threat to Go After Apple’s Source Code

March 14, 2016/29 Comments/in 2016 Presidential Election /by emptywheel

Oops: My post URLs crossed. Here’s where If Trump’s Protestors Didn’t Exist He Would Have to Invent Them is.

In a rather unfortunate section heading the government used in their brief responding to Apple last week, DOJ asserted “There Is No Due Process Right Not to Develop Source Code.” The heading seemed designed to make Lavabit’s point about such requests being involuntary servitude.

I’d like to elaborate on this post to look at what DOJ has to say about source code — because I think the filing was meant to be an explicit threat that DOJ can — and may well, even if Apple were to capitulate here — demand Apple’s source code.

The government’s filing mentions “source code” ~~nine~~ ten different times [see update]. The bulk of those mentions appear in DOJ’s rebuttal to Apple’s assertion of a First Amendment claim about having to write code that violates its own beliefs, as in these three passages (there is one more purportedly addressing First Amendment issues I discuss below).

Incidentally Requiring a Corporation to Add Functional Source Code to a Commercial Product Does Not Violate the First Amendment

Apple asserts that functional source code in a corporation’s commercial product is core protected speech, such that asking it to modify that software on one device—to permit the execution of a lawful warrant—is compelled speech in violation of the First Amendment.

[snip]
There is reason to doubt that functional programming is even entitled to traditional speech protections. See, e.g., Universal City Studios, Inc. v. Corley, 273 F.3d 429, 454 (2d Cir. 2001) (recognizing that source code’s “functional capability is not speech within the meaning of the First Amendment”).

[snip]

To the extent Apple’s software includes expressive elements—such as variable names and comments—the Order permits Apple to express whatever it wants, so long as the software functions. Cf. Karn v. United States Department of State, 925 F. Supp. 1, 9- 10 (D.D.C. 1996) (assuming, without deciding, that source code was speech because it had English comments interspersed).

Most people aside from EFF think Apple’s First Amendment claim is the weakest part of its argument. I’m not so sure that, in the hands of the guy who argued Citizens United before SCOTUS, it will end up that weak. Nevertheless, DOJ focused closely on it, especially as compared to its treatment of Apple’s Fifth Amendment argument, which is where that dumb heading came in. This is the entirety of DOJ’s response to that part of Apple’s argument.

There Is No Due Process Right Not to Develop Source Code

Apple lastly asserts that the Order violates its Fifth Amendment right to due process. Apple is currently availing itself of the considerable process our legal system provides, and it is ludicrous to describe the government’s actions here as “arbitrary.” (Opp. 34); see County of Sacramento v. Lewis, 523 U.S. 833, 846-49 (1998). If Apple is asking for a Lochner-style holding that businesses have a substantive due process right against interference with its marketing strategy or against being asked to develop source code, that claim finds no support in any precedent, let alone “in the traditions and conscience of our people,” “the concept of ordered liberty,” or “this Nation’s history.” Washington v. Glucksberg, 521 U.S. 702, 721 (1997).

Though admittedly, that’s about how much Apple included in its brief.

The Fifth Amendment’s Due Process Clause Prohibits The Government From Compelling Apple To Create The Request [sic] Code

In addition to violating the First Amendment, the government’s requested order, by conscripting a private party with an extraordinarily attenuated connection to the crime to do the government’s bidding in a way that is statutorily unauthorized, highly burdensome, and contrary to the party’s core principles, violates Apple’s substantive due process right to be free from “‘arbitrary deprivation of [its] liberty by government.’” Costanich v. Dep’t of Soc. & Health Servs., 627 F.3d 1101, 1110 (9th Cir. 2010) (citation omitted); see also, e.g., Cnty. of Sacramento v. Lewis, 523 U.S. 833, 845-46 (1998) (“We have emphasized time and again that ‘[t]he touchstone of due process is protection of the individual against arbitrary action of government,’ . . . [including] the exercise of power without any reasonable justification in the service of a legitimate governmental objective.” (citations omitted)); cf. id. at 850 (“Rules of due process are not . . . subject to mechanical application in unfamiliar territory.”).

In other words, both Apple and DOJ appear to have a placeholder for discussions about takings (one that Lavabit argued from a Thirteenth Amendment perspective).

Those constitutional arguments, however, all seem to pertain the contested order requiring Apple to create source code that doesn’t currently exist. Or do they?

As I noted in my earlier Lavabit post, the DOJ argument doesn’t focus entirely on writing code that doesn’t already exists. As part of its argument for necessity, DOJ pretends to take Apple at its word that the US government could not disable the features (as if that’s what they would do if they had source code!) themselves.

Without Apple’s assistance, the government cannot carry out the search of Farook’s iPhone authorized by the search warrant. Apple has ensured that its assistance is necessary by requiring its electronic signature to run any program on the iPhone. Even if the Court ordered Apple to provide the government with Apple’s cryptographic keys and source code, Apple itself has implied that the government could not disable the requisite features because it “would have insufficient knowledge of Apple’s software and design protocols to be effective.” (Neuenschwander Decl. ¶ 23.)

Note DOJ claims to source that claim to Apple Manager of User Privacy Erik Neuenschwander’s declaration (which is included with their motion). But he wasn’t addressing whether the government would be able to reverse-engineer Apple’s source code at all. Instead, that language came from a passage where he explained why experienced engineers would have to be involved in writing the new source code.

New employees could not be hired to perform these tasks, as they would have insufficient knowledge of Apple’s software and design protocols to be effective in designing and coding the software without significant training.

So the discussion of what the government could do with if it had Apple’s source code is just as off point as the passage invoking the Lavabit case (which involved an SSL key, but not source code). Here’s that full passage:

The government has always been willing to work with Apple to attempt to reduce any burden of providing access to the evidence on Farook’s iPhone. See Mountain Bell, 616 F.2d at 1124 (noting parties’ collaboration to reduce perceived burdens). Before seeking the Order, the government requested voluntary technical assistance from Apple, and provided the details of its proposal. (Supp. Pluhar Decl. ¶ 12.) Apple refused to discuss the proposal’s feasibility and instead directed the FBI to methods of access that the FBI had already tried without success. (Compare Neuenschwander Decl. ¶¶ 54-61, with Supp. Pluhar Decl. ¶ 12.) The government turned to the Court only as a last resort and sought relief on narrow grounds meant to reduce possible burdens on Apple. The Order allows Apple flexibility in how to assist the FBI. (Order ¶ 4.) The government remains willing to seek a modification of the Order, if Apple can propose a less burdensome or more agreeable way for the FBI to access Farook’s iPhone.9

9 For the reasons discussed above, the FBI cannot itself modify the software on Farook’s iPhone without access to the source code and Apple’s private electronic signature. The government did not seek to compel Apple to turn those over because it believed such a request would be less palatable to Apple. If Apple would prefer that course, however, that may provide an alternative that requires less labor by Apple programmers. See In re Under Seal, 749 F.3d 276, 281-83 (4th Cir. 2014) (affirming contempt sanctions imposed for failure to comply with order requiring the company to assist law enforcement with effecting a pen register on encrypted e-mail content which included producing private SSL encryption key).

Effectively, having invented a discussion about whether the government would be able to use Apple’s source code out of thin air, DOJ returns to that possibility here, implying that that would be the least burdensome way of getting what it wanted and then reminding that it has succeeded in the past in demanding that a provider expose all of its users to government snooping, even at the cost of shutting down the business, even after Ladar Levison (after some complaining) had offered to provide decrypted information himself.

Significantly, the government obtained a warrant for Lavabit’s keys as a way of avoiding the question of whether the “technical assistance” language in the Pen/Trap statute extended to sharing keys, but Levison was ultimately held in contempt for all the orders served on him, including the Pen/Trap order and its language about technical assistance. The Fourth Circuit avoided ruling on whether that assistance language in Pen/Trap orders extended to encryption keys by finding that Levison had not raised it prior to appeal and that the District Court had not clearly erred, which effectively delayed consideration of the same kinds of issues at issue (though under a different set of laws) in the Apple encryption cases.

In making his statement against turning over the encryption keys to the Government, Levison offered only a one-sentence remark: “I have only ever objected to turning over the SSL keys because that would compromise all of the secure communications in and out of my network, including my own administrative traffic.” (J.A. 42.) This statement — which we recite here verbatim — constituted the sum total of the only objection that Lavabit ever raised to the turnover of the keys under the Pen/Trap Order. We cannot refashion this vague statement of personal preference into anything remotely close to the argument that Lavabit now raises on appeal: a statutory-text-based challenge to the district court’s fundamental authority under the Pen/Trap Statute. Levison’s statement to the district court simply reflected his personal angst over complying with the Pen/Trap Order, not his present appellate argument that questions whether the district court possessed the authority to act at all.

[snip]

The Government, however, never stopped contending that the Pen/Trap Order, in and of itself, also required Lavabit to turn over the encryption keys. For example, the Government specifically invoked the Pen/Trap Order in its written response to Lavabit’s motion to quash by noting that “four separate legal obligations” required Lavabit to provide its encryption keys, including the Pen/Trap Order and the June 28 Order.

[snip]

In view of Lavabit’s waiver of its appellate arguments by failing to raise them in the district court, and its failure to raise the issue of fundamental or plain error review, there is no cognizable basis upon which to challenge the Pen/Trap Order. The district court did not err, then, in finding Lavabit and Levison in contempt once they admittedly violated that order.

In other words, the Lavabit reference, like the invention of an Apple discussion about what the government could do with its source code (any such discussion would have been interesting in and of itself, because I’d bet Apple would be more confident FBI couldn’t do much with its source code than that NSA couldn’t), was off point. But in introducing both references, DOJ laid the groundwork for a demand for source code to be the fallback, least burdensome position.

And, as I noted, in the Lavabit case, the government justified demanding a key based on the presumption that Edward Snowden would have a more complicated password than Syed Rizwan Farook’s 4-digit numerical passcode. That is, in that case, the government tied a more intrusive demand to the difficulty of accessing a target’s communications, not to the law itself, which suggests they’d be happy to do so in the future if they were faced with an Apple phone with a passcode too complex to brute force in 26 minutes, as FBI claims it could do here.

All of which brings me to one more citation of source code in DOJ’s extended First Amendment discussion: a reference to a civil case where Apple was able to obtain the source code of a competitor.

This form of “compelled speech” runs throughout both the criminal and civil justice systems, from grand jury and trial subpoenas to interrogatories and depositions. See, e.g., Apple Inc.’s Motion to Compel in Apple Inc. v. Samsung Electronics, Docket No. 467 in Case No. 11–cv–1846–LHK, at 11 (N.D. Cal. Dec. 8, 2011) (Apple’s seeking court order compelling Samsung to produce source code to facilitate its compelled deposition of witnesses about that source code).

Note, this is not a case about Apple (or Samsung, in this case) being compelled to write new code at all. Rather, it is a case about handing over the source code a company already had. In another off point passage, then, DOJ pointed to a time when Apple itself successfully argued the provision of source code could be compelled, even in a civil case.

Through a variety of means, DOJ went well out of its way to introduce the specter of a demand for Apple’s source code into its response. They are clearly suggesting that if Apple refuses to write code that doesn’t exist, the government will happily take code that does.

Loretta Lynch claimed, under oath last week, that the government doesn’t want a back door into Apple products. That’s not what her lawyers have suggested in this brief. Not at all.

Update: Here’s how Apple treated this in its Reply:

The government also implicitly threatens that if Apple does not acquiesce, the government will seek to compel Apple to turn over its source code and private electronic signature. Opp. 22 n.9. The catastrophic security implications of that threat only highlight the government’s fundamental misunderstanding or reckless disregard of the technology at issue and the security risks implicated by its suggestion.

Also, in writing this post, I realized there’s one more reference to source code in the government’s Response, one that admits Apple’s source code is “the keys to the kingdom.”

For example, Apple currently protects (1) the source code to iOS and other core Apple software and (2) Apple’s electronic signature, which as described above allows software to be run on Apple hardware. (Hanna Decl. Ex. DD at 62-64 (code and signature are “the most confidential trade secrets [Apple] has”).) Those —which the government has not requested—are the keys to the kingdom. If Apple can guard them, it can guard this.

How Hillary Helped Banks Foreclose on 5 Million Families

March 10, 2016/5 Comments/in 2016 Presidential Election, automobiles, Financial Fraud /by emptywheel

Let me be clear at the outset: I think what follows is a bullshit argument. But I think it is less unfair of an argument than Hillary’s claim that, by voting to withhold the second tranche of TARP funding on January 15, 2009, Bernie Sanders voted against the auto bailout.

As you’ll recall, in October 2008, the Bush Administration threw some vaguely laid out plans on some cocktail napkins over the wall to Congress and got it to release $700 billion dollars to bail out the banks. Between the time the new Congress got sworn in but before Obama became President, Republicans in the Senate wrote a bill to withhold the second tranche, or $350 billion, of those funds. In the days before the vote, Larry Summers threw two more cocktail napkins of promises to Congress. Bernie was one of seven Democrats who voted not to release the funds based on a series of what were effectively ideas on cocktail napkins.

One of the things on those cocktail napkins, though, was a promise from the Obama Administration that actual human persons facing a crisis, rather than just banks, would get some of the second tranche of money.

The Obama Administration will commit substantial resources of $50-100B to a sweeping effort to address the foreclosure crisis. We will implement smart, aggressive policies to reduce the number of preventable foreclosures by helping to reduce mortgage payments for economically stressed but responsible homeowners, while also reforming our bankruptcy laws and strengthening existing housing initiatives like Hope for Homeowners. Banks receiving support under the Emergency Economic Stabilization Act will be required to implement mortgage foreclosure mitigation programs.

Of course, it was just a cocktail napkin, and by voting to release the funds without tying them to actual legislation requiring the Administration actually use the funds in a such a way as to help homeowners, Hillary — and all the other Democrats who voted to give their new President funds without real limits on how they could spend it — gave away any leverage they had to actually force the Administration to implement such a plan.

Last year David Dayen described how the Administration not only never spent $50 billion — they only ever spent $12.8 billion — but the number of people helped was far lower than promised, and most people “helped” actually weren’t helped at all.

On January 15, 2009, Obama’s chief economic policy adviser, Larry Summers, wrote to convince Congress to release the second tranche of TARP funds, promising that the incoming administration would “commit $50-$100 billion to a sweeping effort to address the foreclosure crisis … while also reforming our bankruptcy laws.” But the February 2009 stimulus package, another opportunity to legislate mortgage relief, did not include the bankruptcy remedy either; at the time, the new administration wanted a strong bipartisan vote for a fiscal rescue, and decided to neglect potentially divisive issues. Having squandered the must-pass bills to which it could have been attached, a cramdown amendment to a housing bill failed in April 2009, receiving only 45 Senate votes.

Senate Majority Whip Dick Durbin, who had offered the amendment, condemned Congress, declaring that the banks “frankly own the place.” In fact, the administration had actively lobbied Congress against the best chances for cramdown’s passage, and was not particularly supportive when it came up for a vote, worrying about the impacts on bank balance sheets. Former Treasury Secretary Timothy Geithner admitted in his recent book, “I didn’t think cramdown was a particularly wise or effective strategy.” In other words, to get the bailout money, the economic team effectively lied to Congress when it promised to support cramdown.

[snip]

According to a recent Government Accountability Office report, 64 percent of all applications for loan modifications were denied. Employees at Bank of America’s mortgage servicing unit offered perhaps the most damning revelations into servicer conduct. In a class-action lawsuit, these employees testified that they were told to lie to homeowners, deliberately misplace their documents, and deny loan modifications without explaining why. For their efforts, managers rewarded them with bonuses—in the form of Target gift cards—for pushing borrowers into foreclosure.

Because of all this, HAMP never came close to the 3–4 million modifications President Obama promised at its inception. As of August 2014, 1.4 million borrowers have obtained permanent loan modifications, but about 400,000 of them have already re-defaulted, a rate of about 30 percent. The oldest HAMP modifications have re-default rates as high as 46 percent.

Effectively, because Congress didn’t force the Administration to adopt cramdown (which would have resulted in real modifications which would have mean more people kept their homes and didn’t lose their wealth), Treasury could instead use the promise to “foam the runways” to help the banks string out losses and therefore avoid accountability for their recklessness.

This was a direct result of voting to give the Executive continued free rein on what to do with massive amounts of bailout money. So was bailing out the car industry, but the vote in January was primarily about whether to continue letting the Executive spend billions without clear guidelines.

So Hillary, according to her own logic, voted to help banks foreclose on 5 million people, which resulted in a tragic loss of wealth for American families.

Again, I think this is a bullshit argument. I assume Hillary intended to get real foreclosure relief (indeed, one domestic policy on which she was better than Obama in 2008 did just that). Though for someone who claims to know how to “get things done,” she showed no awareness of how to do that here. Nevertheless, it is the kind of bullshit argument she is making.

And having gone there — having permitted herself to engage in this kind of bullshit argument — she makes such arguments fair game for Donald Trump to make about her in June.

Ultimately, I think this vote was about whether the Executive should be able to operate without real limits. Bernie voted against that, Hillary voted for it (which makes it similar, in many ways, to the Iraq War vote in 2003, and had equally foreseeably bad results). Hillary will never make such votes for freeing the Executive of meaningful restraints again. But it’s pretty clear she’s a fan of letting the Executive operate without them.

That, to me, is the meaningful, non-bullshit, takeaway from that vote.

Bernie Wins MI — Wait Whut?

March 9, 2016/28 Comments/in 2016 Presidential Election /by emptywheel

Apparently my state gave Bernie Sanders the most unexpected of wins last night, winning a close race that only one poll even got close (but still predicted a narrow Hillary win). Most polls predicted she’d win it by 20%.

I’m going to spend the day looking at the results. But here’s what I understand to have happened:

Hillary won African-Americans, but not by as much as she had in the south. That’s probably consistent with MA’s results, the exit poll for which didn’t break down people of color, but as far as I know no one did the granular analysis of the MA results to figure that out.
MI’s Muslims voted for the elderly Polish Jew, by wide margins. That’s not a huge population, but it is big enough to have accounted for much of the differential between Hillary and Bernie. Keith Ellison, one of Sanders’ few Congressional backers, has close ties to the Muslim community here in MI and did some events for him in the last week.
Independents turned out in big numbers, and they voted for Sanders by big margins. MI has a completely open voting process, which means independents — who might normally be considered less likely primary voters — can (and apparently did) turn out in big numbers. I suspect, though haven’t yet confirmed it, that support for Bernie outside of SE MI was much higher in terms of numbers; usually when people analyze Democratic contests in this state they just blow off the areas outside of SE MI, because the latter is such a population center of Democratic voters. That may be what pollsters missed. Update: Adding, the Democratic party in my part of the state is pretty dysfunctional, even though there’s a population that should be turning increasingly Democratic. This is where Bernie picked up the numbers to offset Hillary’s SE MI numbers. That suggests he basically created a Democratic infrastructure that doesn’t exist (as Chris Savage pointed out, Bernie set up offices here and in other cities so had more field organizers throughout the state, save Detroit, than Hillary).
Students voted, and not just in Ann Arbor. Because of the way they suppress student turnout, University of Michigan is the school at which it is hardest for college students to vote (because they’re more likely to be out of state and/or from all over the state, which means if there’s a registration problem they’ll have harder time going “home” to vote). Bernie did events at EMU, MSU, GVSU, and only then U of M, and while those students are more likely to be dispersed than UM students, they appear to have turned out. Bernie continued to win young people by enormous margins.
Hillary underperformed in the rich suburbs. Hillary only won Oakland County, which is the second largest county and is the kind of affluent county Hillary has done really well in this year, by about 4.6%. I thought she’d win by 5 to 7%. I’m not sure why that is — again, it’s always possible cross-over voting is affecting the Democratic side. But had she gotten the numbers in Oakland I would have expected she likely would have won the state. The same is true of Detroit, but turnout in Detroit is less reliable than in Oakland.

There was a lot of talk last night about Hillary’s cynical auto bailout attack misfiring. Apparently, some top UAW people got quite pissed about it and were communicating about it among themselves.

It may be that Michiganders realized that was a dishonest attack, but I think it just as likely they responded to Sanders’ comments about Hillary’s trade record (curiously, he never even hammered on KORUS, where her involvement is much more direct than some of the other trade agreements she has supported, and which has had a clear impact on MI jobs). I’ve been predicting for some time that Hillary’s record on trade would hurt her in the state. Exit polls showed that those who think trade agreements have cost MI jobs voted in fairly big numbers for Bernie.

Update: One more point. I’m hearing a lot of talk about Hillary voters crossing over to vote for Kasich or Rubio to slow Trump’s momentum. I doubt that explains Hillary’s loss. First, any talk of that is anecdotal: there was no big discussion about how to strategize a cross-over vote. Second, the Kasich and Rubio numbers just don’t show any big swing, except perhaps in Washtenaw (Ann Arbor), but the Democratic results are about what we’d expect there. Third, the only people I heard talk about this were Sanders voters, so to the extent it did happen, it likely happened, in small numbers, among both Bernie and Hillary voters. Finally, while crossover voting is quite common here, it’s less common among party insiders than more independent voters (in part, because what ballot you pull does get recorded, so it shows in the voting rolls), so you’d think fewer of Hillary’s supporters would even consider it.

Update 2: I know that exit polls showed 7% of Dems crossed over compared to 3% of Republicans. I actually suspect those numbers are lower than what happened in other states and mostly stems from Democrats voting for Trump. Indeed, it’s possible that those who wanted to vote for a populist in MI felt like Bernie was a viable choice here (which would be consistent with where he got his biggest margins) as compared to places in the south where Trump was a more attractive populist to vote for.

How Hillary Turned Her Support for Welfare for Banks into an Auto Bailout Attack

March 7, 2016/29 Comments/in automobiles, Class War, Economics, Financial Fraud /by emptywheel

For a campaign that has spent days insisting Bernie Sanders should not launch attacks against her, the Hillary Clinton campaign sure engaged in some dishonest hackery last night.

During the debate in Flint, Hillary attacked Bernie for “vot[ing] against the money that ended up saving the auto industry.” She was talking about a January 15, 2009 attempt to withhold the second $350 billion of TARP funding that failed (here’s the resolution); Bernie voted not to release those funds. But the vote was not directly about auto bailout funding. It was about bailing out the banks and funding what turned out to be completely ineffective efforts to forestall foreclosures.

It is true that Bush’s failure to fund an auto-specific bailout meant that TARP funds got used to fund the $85 billion auto rescue (Bush had already spent some money on the auto companies — basically just enough to ensure they’d go under on Obama’s watch, but not enough to do anything to save them). But that’s not what the vote was (and there might have been enough money for the auto bailout in any case).

Larry Summers’ two letters in support of the additional funding (January 12, Janaury 15) in support of the additional funding certainly didn’t describe it as an auto bailout bill. He mentioned “auto” just three times between the two of them. In the January 12 letter, in support of auto loans to consumers, and in the January 15 letter, limits on what I believe is a reference to GM Finance (now Ally)’s Christmas holiday move to turn into a bank so it could access funding. Contemporary reporting on the vote also did not mention the auto bailout (though there had been discussion that it might be used the previous month).

Moreover, there had been an auto bailout vote in the Senate (on a bill already passed by the House) on December 11, which failed. Both Bernie and Hillary voted in support.

So while Hillary’s attack was technically correct — Bernie did vote against giving Jamie Dimon more free money, which had the side effect of voting against the second installment on the fund that would eventually become the auto bailout — he did not vote against the auto bailout.

But Hillary’s attack did its work, largely because national reporters appeared completely unaware that they were fighting about TARP much less aware that there had been votes in December that directly pertained to the auto bailout. Even some local reporters now appear unaware of what went down in 2008-9. John Podesta helped matters along by sowing confusion in post-debate speeches.

Here’s one of what will end up being several exceptions to the shitty reporting on this that will come too late for people to figure out what actually happened.

During the testy exchange over the auto bailout, Clinton called Sanders a “one-issue candidate” for voting against the release of $350 billion in Jan. 15, 2009, to continue funding the bailout of the nation’s banks and mortgage lenders.

Sanders joined seven Democratic senators in voting against the second wave of TARP funds. President Barack Obama ended up using some of TARP to fund the $85 billion rescue of GM, Chrysler and their auto lending arms.

“If everybody had voted the way he did, I believe the auto industry would have collapsed, taking 4 million jobs with it,” Clinton said.

[snip]

David Axelrod, a former top adviser to President Barack Obama, questioned Clinton’s attack on Sanders’ voting record in the middle of the debate.

“It wasn’t explicitly a vote about saving auto industry,” Axelrod wrote on Twitter.

U.S. Sen. Debbie Stabenow, a Clinton supporter, said after the debate that senators, including Sanders, were aware the TARP money would be used to aid the domestic auto industry.

“A lot of folks said we shouldn’t do it because somehow it was helping the banks,” said Stabenow, D-Lansing. “It was the auto bailout we were talking about. I was very clear with colleagues that we had to do this.”

Stabenow’s comment, incidentally, is proof that the money shouldn’t have been granted as it was (it wasn’t spent on auto companies until much later). While she’s right that there had been public discussion of spending some money on the auto bailout, there obviously was still so little limiting what the Executive could do with the money that there needed to be nothing explicit supporting the auto bailout to make it happen. The flimsiness of the guidelines is one of the things that enabled the Obama Administration to avoid providing real foreclosure relief, choosing instead to “foam the runway” for banks.

Don’t get me wrong. Bernie did a number of other things at the debate that hurt him last night, such as his comment about ghettos that suggested all African Americans are poor and no whites are. I think, too, the optics of his efforts to stop Hillary from interrupting him as well as his own gesticulating while she was making responses will go over poorly.

But the auto bailout attack was a pretty shameful ploy, one that otherwise would make it fair game to really hit on Hillary’s own actions in a way Bernie has not yet done. That said, it was also a probably perfectly timed attack, because it will ensure victory for Hillary on Tuesday, eliminating one of the last possibilities that Bernie might really challenge Hillary.

Update: As it turns out, Hillary should be attacking Stabenow according to her own standards, because Stabenow voted no on the first TARP vote that actually paid for the first tranche of funding to the auto companies. (Here’s the second, January 2009 one.)

The Return of the Reagan Democrats

March 5, 2016/70 Comments/in 2016 Presidential Election /by emptywheel

Donald Trump held a rally in Warren, MI today, a blue-collar, largely white suburb of Detroit in Macomb County. The county, as a whole, is famous for what Democratic pollster Stan Greenberg dubbed the “Reagan Democrats” after lifelong white working class Democrats started flipping to the GOP in 1980, as he described in this study done on polling about Obama in 2008.

In 1960, Macomb was the most Democratic suburban county in the country as John F. Kennedy won handily there, garnering 63 percent of the vote. Four years later, Lyndon Johnson increased the Democratic vote share even further, winning 75 percent of Macomb voters. But over the next 20 years, these voters turned on the Democrats, culminating with Ronald Reagan taking 66 percent of the vote in 1984.

Even before the election, Greenberg found Obama did worse with Macomb’s voters than he did elsewhere. Greenberg even found some racial basis for that, though not as much as he had earlier. But Greenberg judged early on that Obama did so much better elsewhere in the state — primarily, with the young, but also by generating enthusiasm among African American voters — that it wouldn’t matter.

Obama is running 7 points ahead in our statewide poll conducted at the same time. Obama obviously will be able to count on immense enthusiasm and turnout among African Americans, but there is more going on than that – including Obama’s over-performance in the growing suburban parts of the state, including Oakland County, where he is running a net 5 points above party identification and 9 points ahead of John McCain. Among young voters under 30 years, Obama defeats McCain 58 to 36 percent but Obama’s success with younger voters is even broader.

He leads McCain among all voters under 40 years by 48 to 41 percent across Michigan and matches that margin in Macomb. Clearly, the rules of the game are a little different this year.

Sure enough, Obama did over-perform in the suburbs. So much so that after the election, Greenberg said so long to his Macomb Reagan Democrats, embracing, instead, the racially diverse (or at least tolerant) suburbanites who could replace them in the Democratic coalition.

Oakland County has formed part of the Republican heartland in Michigan and the country. From 1972 to 1988, Democratic presidential candidates in their best years lost the county by 20 points. From Bill Clinton to John Kerry, however, Democrats began to settle for a draw. Over the past two decades, Oakland County began to change, as an influx of teachers, lawyers and high-tech professionals began to outnumber the county’s business owners and managers. Macomb has been slow to welcome racial diversity, but almost a quarter of Oakland’s residents are members of various racial minorities.

These changes have produced a more tolerant and culturally liberal population, uncomfortable with today’s Republican Party. When we conducted our poll of 600 voters in Oakland County on election night, they were a lot more open than voters in Macomb to gay marriage and affirmative action. We asked those who voted for Mr. Obama why they made that choice. At the top of the list was his promise to withdraw troops from Iraq, followed by his support for tax cuts for the middle class and affordable health care for all, and the idea that he will bring people together, end the old politics and get things done.

On Tuesday, Oakland County voters gave Mr. Obama a 57 percent to 42 percent victory over John McCain — those 15 points translated into an astonishing 96,000-vote margin. That helped form one of the most important new national changes in the electorate: Mr. Obama built up striking dominance in the country’s growing, more diverse and well-educated suburbs.

So, good riddance, my Macomb barometer.

But in elections since, Democrats have been doing worse and worse among whites and, in the interim years, losing elections as a result. By 2014, Greenberg was not so sanguine about Democrats’ losing those white voters anymore.

For example, a lot of blue-collar work today takes place in small groups rather than in factory settings, and most construction workers are self-employed contractors. Moreover, if by blue-collar jobs we mean jobs that involve routine and repetitive tasks, require limited skills, are closely supervised, and offer no autonomy during working hours, then it turns out that half of all white male workers and 40 percent of white working women are blue collar. Far from working on factory floors, more and more workers are employed in service-sector jobs like health care, leisure and hospitality, and, particularly, professional and business services.

If Democrats cannot figure out how to appeal to today’s working-class voters, then they don’t deserve to lead. Nearly all of the people in these jobs have not seen a raise in years. The majority of them, who now work in the service sector—maids and housekeepers, waitresses and hostesses, cooks and dishwashers, counter attendants and ticket takers, janitors and hairdressers and child care workers—earn, on average, about $400 a week.

At that point, the GOP wasn’t even doing all that well with these voters. But they are now, with Donald Trump, returning today to the site of Reagan’s victory with the support of a bunch of working people arguably voting against their economic interest. Trump is speaking the language — significantly, of building infrastructure, and not just his damned wall — that would appeal to this group in a way the GOP had foresworn. And in Macomb, as elsewhere, Trump’s voters are his voters, largely detached from either party and thus far unimpressed with the dirt the GOP threw last night and reportedly will start throwing in abundance in the near future. Trump seems to recognize he has a limited window of time to win out before the shit gets really deep, and he stands a very good chance of doing just that.

And there is a real reason to be concerned that it will lead to victory for the GOP in November.

Thus far, we’re seeing Democratic turnout down, significantly, and GOP turnout up even more. That comes, in large part, because white voters — thus far we’ve had voting in the South, so these consist of what this analysis calls old-style Dixiecrats as well as Trump cross-overs — are turning to Donald Trump. Worse, we’re not seeing the kind of turnout among people of color, not even African Americans, that Democrats have been presuming would build a permanent firewall against GOP victories.

So it’s absolutely imperative that we find some way to do three things:

Bring back some form of the Obama effect on African American turnout, so it does not fall (as it did in South Carolina).

Give younger voters the motivation to actually turn out and vote.

Effectively fight the Trump effect, and stem the anti-establishment exodus of working class whites to the GOP, and to Trump.

If we can’t find a way to do that, then in the outer South:

North Carolina will not be remotely competitive.

Virginia won’t lean Dem, and could be a true tossup or even lean R.

Florida won’t really be a tossup, but will probably lean reasonably R as in 2004 (unless gains among Hispanics are fully strong enough to offset the Trump effect in North Florida and the drift of older retirees to the GOP).

That’s enough by itself to return the electoral college map to something more similar to what we had in 2000 and 2004. And if the Trump effect is strong in places like Ohio, Pennsylvania, and Michigan, then we could have a real fight on our hands, without any clear reason to think we have the upper hand.

In other words, with Trump on the GOP ballot and Obama off the Dem ballot, the Obama coalition could come tumbling down and crash into pieces. That “blue wall” we liked to think made America safe from another George W. Bush? Gone. History.

But even in MA, Trump drew those working class whites in YUGE numbers.

Bernie probably had a shot at winning among white and black and brown working people. Partly because the Democrats launched Republican attacks on sound policy, partly because Bernie didn’t listen to people of color enough, and partly because Trump had an easier sell to the white working class, he won’t pull it off.

Which will leave Hillary and Oakland’s voters (or, in parallel fashion, huge wins in the most affluent Military Industrial Complex suburbs of VA).

Democrats risk losing this election, once again to Reagan’s Democrats. If Trump wins, it may also be a realignment election, where Democrats become the party of those suburbs while Trump feeds the fears of those working towns. As Greenberg said, Democrats don’t deserve to win if they’re not offering solutions for those working class service workers, of all classes.

And thus far, Democrats haven’t convinced sufficient numbers they do.

Christina Romer’s Evidence Based Economics

February 17, 2016/18 Comments/in Economics /by emptywheel

Christina Romer and some other Chairs of Democratic Presidents’ Council on Economic Advisors are out tut-tutting Bernie Sanders’ economic plans.

We are concerned to see the Sanders campaign citing extreme claims by Gerald Friedman about the effect of Senator Sanders’s economic plan—claims that cannot be supported by the economic evidence.

[snip]

As much as we wish it were so, no credible economic research supports economic impacts of these magnitudes. Making such promises runs against our party’s best traditions of evidence-based policy making and undermines our reputation as the party of responsible arithmetic. These claims undermine the credibility of the progressive economic agenda and make it that much more difficult to challenge the unrealistic claims made by Republican candidates.

I find Romer’s signature on this document to be interesting given what we know about a report Romer and President Obama’s other economic advisors did in the transition period in 2008. Romer had calculated that it would take $1.7-1.8 Trillion to undo the damage the banks had done. But Larry Summers not only bullied her into taking that out of the report presented to the President, but even the “compromise” $1.2 Trillion she proposed instead.

Romer calculated that it would take an eye-popping $1.7-to-$1.8 trillion to fill the entire hole in the economy—the “output gap,” in economist-speak. “An ambitious goal would be to eliminate the output gap by 2011–Q1 [the first quarter of 2011], returning the economy to full employment by that date,” she wrote. “To achieve that magnitude of effective stimulus using a feasible combination of spending, taxes and transfers to states and localities would require package costing about $1.8 trillion over two years.”

[snip]

When Romer showed Summers her $1.7-to-$1.8 trillion figure late the week before the memo was due, he dismissed it as impractical. So Romer spent the next day or two coming up with a reasonable compromise: $1.2 trillion. In a revised document that she sent Summers over the weekend, she included the $1.2 trillion figure, along with two more limited options: about $600 billion and about $850 billion.

At first, Summers gave her every indication that all three figures would appear in the memo he was sending the president-elect. But with less than twenty-four hours before the memo needed to be in Obama’s hands, Summers informed her that he was inclined to strike the $1.2 trillion figure.

[snip]

The final version of the memo had framed the debate around two basic choices—roughly $600 billion and roughly $850 billion—and these were the focus of the conversation.

In the end, Congress passed somewhere between $787 and $831 billion in stimulus — near the high side of what Summers presented, but still half of what Romer said the economy really needed.

As a result, of course, we’ve had a recovery for the banks, but far less of one for average people. That is, short-selling the stimulus put us where we are now, with millions of voters supporting outsider candidates like Sanders and Trump, because wonks like Larry Summers promised the stimulus was adequate to the problems facing the country.

Hillary’s Admission Diplomacy Couldn’t Get Pakistan To Hand Over Bin Laden

February 12, 2016/35 Comments/in emptywheel /by emptywheel

There was a really weird moment during the foreign policy section of last night’s debate.

Bernie, to respond to Hillary’s explanation of what we need to do to win wars against terrorism, said he doesn’t support regime change. To counter him, Hillary said, in part, that he had voted in favor of regime change in Libya.

Which led to this exchange:

SANDERS: Judy, if I can, there is no question, Secretary Clinton and I are friends, and I have a lot of respect for her, that she has enormous experience in foreign affairs. Secretary of state for four years. You’ve got a bit of experience, I would imagine.

But judgment matters as well. Judgment matters as well. And she and I looked at the same evidence coming from the Bush administration regarding Iraq. I lead the opposition against it. She voted for it.

But more importantly, in terms of this Libya resolution that you have noted before, this was a virtually unanimous consent. Everybody voted for it wanting to see Libya move toward democracy, of course we all wanted to do that.

SANDERS: That is very different than talking about specific action for regime change, which I did not support.

CLINTON: You did support a U.N. Security Council approach, which we did follow up on. And, look, I think it’s important to look at what the most important counterterrorism judgment of the first four years of the Obama administration was, and that was the very difficult decision as to whether or not to advise the president to go after bin Laden.

I looked at the evidence. I looked at the intelligence. I got the briefings. I recommended that the president go forward. It was a hard choice. Not all of his top national security advisors agreed with that. And at the end of the day, it was the president’s decision. So he had to leave the Situation Room after hearing from the small group advising him and he had to make that decision. I’m proud that I gave him that advice. And I’m very grateful to the brave Navy SEALs who carried out that mission.

This is not the first time Hillary has changed the subject by bringing up the Osama bin Laden killing — a far more awkward example came when she did so to respond to Chuck Todd’s question whether she would release her Goldman Sachs speech transcripts.

TODD: Are you willing to release the transcripts of all your paid speeches? We do know through reporting that there were transcription services for all of those paid speeches. In full disclosure, would you release all of them?

CLINTON: I will look into it. I don’t know the status, but I will certainly look into it. But, I can only repeat what is the fact that I spoke to a lot of different groups with a lot of different constituents, a lot of different kinds of members about issues that had to do with world affairs. I probably described more times than I can remember how stressful it was advising the President about going after Bin Laden.

But this example is more telling in a number of respects.

First, consider why she had to change the subject, aside from the fact that Libya has turned out to be such a colossal mistake. Hillary claimed Bernie voted in favor of regime change and then, without a break, described the vote as favoring Security Council involvement.

He voted in favor of regime change with Libya, voted in favor of the Security Council being an active participate in setting the parameters for what we would do, which of course we followed through on.

The resolution included, among other things, these three parts:

(3) calls on Muammar Qadhafi to desist from further violence, recognize the Libyan people’s demand for democratic change, resign his position and permit a peaceful transition to democracy governed by respect for human and civil rights and the right of the people to choose their government in free and fair elections;

(7) urges the United Nations Security Council to take such further action as may be necessary to protect civilians in Libya from attack, including the possible imposition of a no-fly zone over Libyan territory;

(11) Welcomes the outreach that has begun by the United States government to Libyan opposition figures and supports an orderly, irreversible and transition to a legitimate democratic government in Libya.

It certainly called for Qaddafi to resign and transfer power to a democratic government. It even endorsed the “outreach” — which ultimately involved barely covert support for rebels — as a means to “transition to a legitimate democratic government.” And it called for the UNSC to take further action, which it did weeks later in calling for a no-fly zone. Famously, Russia and China only permitted that resolution to pass because Susan Rice had led them to believe it did not entail regime change (which is why Russia refused to play along with multilateral efforts to do something about Bashar Assad’s massacres).

VITALY CHURKIN (Russian Federation) said he had abstained, although his country’s position opposing violence against civilians in Libya was clear. Work on the resolution was not in keeping with Security Council practice, with many questions having remained unanswered, including how it would be enforced and by whom, and what the limits of engagement would be. His country had not prevented the adoption of the resolution, but he was convinced that an immediate ceasefire was the best way to stop the loss of life. His country, in fact, had pressed earlier for a resolution calling for such a ceasefire, which could have saved many additional lives. Cautioning against unpredicted consequences, he stressed that there was a need to avoid further destabilization in the region.

In last night’s debate, Sanders responded — after talking about what good friends he is with the woman who just claimed he had supported regime change — that he had supported more democracy in Libya, not regime change.

Everybody voted for it wanting to see Libya move toward democracy, of course we all wanted to do that. That is very different than talking about specific action for regime change, which I did not support.

Which led Hillary to suggest, in response, that “we follow[ed] up on,” which led directly to Qaddafi taking a bayonet up his rectum.

You did support a U.N. Security Council approach, which we did follow up on.

Hillary is suggesting (whether solely for political gain or also for legal cover, it’s not entirely clear) that that Senate call for democracy entailed permission to execute regime change. That is, she seems to be claiming that the intent all along was regime change and Sanders should have known that when he did not object to a voice vote in favor of the Libya resolution.

Then, BOOM, dead Osama bin Laden…

… Just in case you start thinking too much about what it means that Hillary suggested that Senate resolution amounted to support for regime change which therefore amounted to an authorization to use military force.

Now, thus far, the exchange is troubling, but not surprising. Hillary’s hawkishness and fondness for fairly broad exercises of executive authority are known qualities.

But the juxtaposition of the disastrous regime change effort in Libya with Obama’s decision to secretly send Navy SEALs into Pakistan to execute Osama bin Laden got me thinking about how different that OBL decision looks when the former Secretary of State is boasting about it, rather than the President.

Once you decide that the way to respond to locating OBL is to sneak into a sovereign country and execute someone, you clearly have to consult with the Secretary of State, as she’s going to have to deal with the diplomatic fallout. That was all the more true as things rolled out, given that we were already conducting delicate negotiations to get Raymond Davis out. Not to mention the way that Davis fiasco soured relations between CIA and State.

Left unsaid, though, is the other option: developing good enough relations with Pakistan — or, more likely, being able to wield enough leverage against Pakistan — such that they would turn him over without the sovereignty violation.

Maybe — likely — that was never going to happen. Maybe — likely — within the bowels of CIA and State and the White House we had good reason to know that Pakistan would not turn over OBL, no matter how much leverage we used. Maybe — likely — it’s also true that the Obama Administration thinks special forces have a better success rate than diplomacy — or thought that, in his first term; his second term, post-Clinton, has had a series of impressive diplomatic successes.

I’m not suggesting I think we could have just asked nicely. But I find it notable that the Secretary of State describes her role as advising the President on whether or not to violate another country’s sovereignty to execute someone, not as considering whether there are other ways to achieve the same objective. I find it remarkable that a Secretary of State boasts about this decision, which ultimately is about the limits of diplomacy even with our so-called allies.

Biased Pluralism and the Defense of “Reality” in the Democratic Primary

February 11, 2016/18 Comments/in 2016 Presidential Election /by emptywheel

Last week, I pointed to a problem with Jonathan Chait’s defense of Hillary Clinton’s “pluralistic” approach to governance, noting that in an era of weak labor organization, such an approach leaves out the views of the great majority of working people, precisely the kinds of people Bernie Sanders is attracting.

I didn’t think of it at the time, but since got reminded of an important paper by Martin Gilens and Benjamin Page, released in 2014. It used a dataset matching polling data to policy outcomes to test four theories for how our political system works: Majoritarian Democracy (meaning policies adopted reflect what most people want), Dominance by Economic Elites (meaning the rich get what they want), Majoritarian Pluralism (meaning interest groups, including those that represent the non-wealthy, get what they want), and Biased Pluralism (meaning interest groups that represent the views of the economic elite get what they want).

Ultimately, the paper showed that our system provides what interest groups want, not what the majority want. Importantly, it also noted that the interest groups that have influence don’t actually represent the preferences of the average citizen (which is defined to be policies supported by a median income voter).

But net interest-group stands are not substantially correlated with the preferences of average citizens. Taking all interest groups together, the index of net interest-group alignment correlates only a non-significant .04 with average citizens’ preferences!

It explains this, in part, because there are so many more interest groups (which include corporations) representing the interests of the economic elite that ultimately they’ll guide policy even when including those interest groups representing the interests of the non-elite.

As a result, majoritarian views — what most Americans want — have almost no influence on policy.

The estimated impact of average citizens’ preferences drops precipitously, to a non-significant, near-zero level. Clearly the median citizen or “median voter” at the heart of theories of Majoritarian Electoral Democracy does not do well when put up against economic elites and organized interest groups. The chief predictions of pure theories of Majoritarian Electoral Democracy can be decisively rejected. Not only do ordinary citizens not have uniquely substantial power over policy decisions; they have little or no independent influence on policy at all.

When the majority gets what they want, it is because the elite interest groups favor the same policy, not because anyone is responding to the interests of the average voter.

Finally, the paper further shows that that is even more true when the majority wants change.

A final point: Even in a bivariate, descriptive sense, our evidence indicates that the responsiveness of the U.S. political system when the general public wants government action is severely limited. Because of the impediments to majority rule that were deliberately built into the U.S. political system—federalism, separation of powers, bicameralism—together with further impediments due to anti-majoritarian congressional rules and procedures, the system has a substantial status quo bias. Thus when popular majorities favor the status quo, opposing a given policy change, they are likely to get their way; but when a majority—even a very large majority—of the public favors change, it is not likely to get what it wants.

So it’s one thing if the majority wants things to remain the same, when they might get what they want, but another thing if they’d like to change the status quo, when they almost never will.

I raise all this because it provides an important reminder for this year’s bizarre presidential election. At least on the Democratic side, the findings totally reinforce both candidates. Bernie Sanders is absolutely right that the system is rigged, that the government’s policies don’t reflect the interests of average Americans. But Hillary Clinton is right, too, that the way to get things done in DC — or at least the way that things have gotten done in DC — is to negotiate compromises within the existing interest group structure (which includes a nearly impotent labor movement and overly powerful corporations). She’s even probably right that in the current system you need to co-opt a certain number of economic elite interest groups (that is, largely, corporate groups) to be able to acquire the critical mass of support from interest groups to get a policy adopted. You’ve got to make enough Goldman Sachs speeches to get them to the table, Hillary might excuse her boondoggle speeches.

But that also has certain implications for the policy debate going on. One problem Hillary is having is in needing to champion — to legitimize — the compromises made within that system: notably, Dodd-Frank and Obama’s insurance reform. She’s doing that by suggesting, with the help of wonk-boys like Chait, that the compromises made in those legislative processes were all that were possible at the time. As I hope to lay out, not only the record — but specific actions by those who remain a part of the Hillary entourage — disprove that claim, at least in theory: 2009 was the rare year when that might not have been true. In addition, Hillary’s choice to function within the existing pluralist system also all presumes that the existing set of interest groups, with the nearly impotent labor movement and overly powerful corporations, are a fixed set.

Which brings us back to Bernie’s call for a revolution, which we might think of as providing average people some means of being an interest group again. Whatever else it is, it could become (unlike the Dean organization that became the 50 state strategy and Obama for America that became a messaging organization within a neutered DNC) a resilient interest group. In many ways, it is a more institutionalized and better funded reincarnation of some recent protest groups, with a very strong overlap with Occupy Wall Street, and as such might have staying power, regardless of what happens with the primary.

But that brings us back to the other problem Hillary (as well as the institutional candidates on the Republican side) is having: voters aren’t dummies.

While you can defend the claim that Obama’s insurance reform was all that was possible, that doesn’t mean — even with the many benefits it has brought about — that it was a sound compromise, much less policy that served the interest of the majority or the country as a whole. Similarly, while you can claim (even more dubiously) that foaming the runway to give the banks a soft landing was necessary, real Americans know we all would be better off with Lloyd Blankfein in prison. That is, you can claim that interest group policies are all we can get, but at that same time that means that interest group policies don’t self-evidently serve the interests of Americans. Hillary can’t admit that, but that’s the truth confirmed in Gilens and Page. It’s also the reason why the wonk-boys are working so hard to claim that these policies serve the good of most people, to try to refute the obvious ways they don’t.

Hillary may well win (the primary, at least) based on truthfully claiming she represents the continuation of Obama’s policies, as Greg Sargent argued yesterday.

Beyond this, the big picture here is that Sanders has gotten as far as he has by offering up a serious, if partial, indictment of the Obama years. He is arguing that Obama era reforms — Dodd-Frank, Obamacare, his climate agenda — ended up being woefully inadequate to the scale of our challenges, because he failed to sufficiently rally the grassroots against the power of the oligarchy and because the Democratic establishment still remains in thrall to oligarchic money. Clinton full-throatedly defends Obama’s accomplishments as very much worth preserving, rejects the Sanders-promulgated notion that Obama could have gotten a whole lot more than he did, and vows to build on those achievements.

The bigger, more diverse, more moderate electorates in the contests to come might be more receptive to Clinton’s arguments along these lines. And one thing to watch will be whether Sanders tries to find a way to temper the criticism of the Obama years that is laced through the story he is telling.

I’d temper that and note that Bernie is probably closer to the real foreign policy successes of Obama’s post-Hillary term, including opening relations with Iran and Cuba and demanding that the Saudis actually start fighting ISIL. But on the Obama policies that are most obviously the result of letting interest groups, from the impotent labor movement to the overly powerful corporations, direct policy, Hillary is the inheritor of a historically fairly popular legacy. That’s true, and it may well be enough, barring any unforeseen economic reversals, though economic reversals are actually looking pretty likely, in which case that legacy may be of far less value.

The problem with being in that very advantageous position is that, especially this year, voters are all too aware that those policies didn’t necessarily serve their needs. And that, it seems, explains the disjuncture between Hillary’s claim (true or not) to best be able to negotiate the interest groups of DC and the fact that that hasn’t been enough to convince voters.

On Pluralism, Bernie Sanders, and the Fight for 15

February 5, 2016/30 Comments/in 2016 Presidential Election, Economics /by emptywheel

In one of the hot-take pieces on the Democratic primary many people are talking about today, Jonathan Chait — fresh off being certified as a wonk by Paul Krugman — distinguishes between what he calls Hillary Clinton’s “pluralist” approach and Bernie Sanders’ “statist” vision.

Sanders did not so much dispute the efficacy of Dodd-Frank as to broaden the question. His fixation with Wall Street is not systemic risk — i.e., the chance that another crash will trigger an economic meltdown. He frames Wall Street as a problem of political economy, not economy. Wall Street is so big and rich that it is inherently dangerous, and will by its nature corrupt the political system.

Clinton does not believe that. Her political ideal is what some political scientists have called “pluralism.” A pluralist politics venerates the careful balancing of competing interests. It is okay to bring business to the bargaining table as long as there is also a place for labor, environmentalists, consumer advocates, and other countervailing interests. Clinton’s Democratic Party, and Obama’s, is one in which pluralist agreements struck important progress not only in financial reform but also health care, public investment, green energy, and other priorities.

Sanders does not completely reject the products of these pluralist compromises. (He grudgingly accepts them as worthwhile, piecemeal steps.) What he rejects is the political model that treats pluralism as the normal model of political action. Sanders believes the interest of the public is not divided, it is united, and only the corrupt influence of big business has thwarted it. He consequently vows to smash its power through a combination of a mass upsurge in political activism and campaign-finance reform.

[snip]

A Democratic Party as monolithically statist as the modern Republican Party is anti-government — one in which any defense of free markets or business is dismissed — would look very different than anything within American historical experience. After decades of this being taken for granted, it has finally become necessary to defend moderation as a governing creed.

Let’s ignore how Chait caricatures Sanders for the moment, warning of an awful “statist” Democratic party in which “any defense of free markets or business is dismissed,” and take his view of Hillary’s pluralism on its face.

In Hillary’s Democratic party, citizens exercise their influence through various interest groups. There’s business (presented here as a monolith), and there there’s “labor, environmentalists, consumer advocates, and other countervailing interests,” and together they compromise on incrementalist policy about which everyone gets a say.

That is, in fact, how the mainstream Democratic party organizes itself, and Hillary’s endorsement by virtually all of the organizations deemed to represent one of these players reflects it. She does have support from business, but she also has support from League of Conservation Voters, Planned Parenthood, Human Rights Campaign, and other big organizations. (There’s a breathtaking list of her endorsements here — you have to scroll down quite a way to get to the institutional endorsements.) This is what that “establishment organization” hubbub was about: that Hillary has the support of the groups deemed to represent the various pluralities of the Democratic party.

On that list are most of the national labor unions. That’s not surprising. Hillary is (still) a favorite to win nomination and after that the general election, and all these organizations are ensuring they’ll have a seat at that pluralist table Hillary sets (though it’s not clear what the unions that backed Obama early in 2008 really got out of the deal; he certainly didn’t deliver the Employee Free Choice Act, as he had suggested he’d try to do). Union leaders endorse early because it ensures they’ll have the ear of the presumptive president.

Even there, as some have noted, a few unions that let members decide who to endorse endorsed Bernie.

But here’s the thing. Just 11.1% of workers were in a union last year. And to the extent that the Democratic party’s pluralism is mediated through these national organizations, it means the views of workers as such are largely represented by organizations they don’t have any stake in, organizations whose workers make 26% more than non-union workers. And we wonder why so few of these workers show up to vote for Democrats?

I asked Chait on Twitter where these more marginalized workers would get their seat at the pluralist table and thus far haven’t gotten an answer.

This question is probably most pressing with regards to the most exciting labor organizing in recent years: the SEIU-backed Fight for 15, which has found a model that works for franchises, and which has also notched a number of key local wins for a higher minimum wage. Importantly, where it succeeds in raising wages for an entire city, people within and outside of the movement structure will do better. But a lot of workers who would be incorporated at the pluralist table by a push for a living minimum wage are not and would not be SEIU members.

Fight for 15 is an issue where there’s a clear policy difference between Hillary, who favors raising the minimum wage to $12 (which is not a living wage in many areas of this country) and Bernie, who enthusiastically supports the $15 goal.

Nevertheless, SEIU endorsed Hillary. Jacobin explained the logic shortly after the endorsement.

If Clinton is going to win — because she has to win — then delaying a primary endorsement has no upside. The union would simply jeopardize its spot on Clinton’s crowded list of favors to return.

But the access argument is also unpersuasive. In 2007 the union was divided internally over whether to back John Edwards or Obama. In the end the national union allowed its state affiliates to go their separate ways, only uniting behind Obama after Edwards had dropped out after the first round of primaries. Opting not to come out early for Obama didn’t prevent the union from mobilizing members and resources for the general election. Similarly, SEIU will be indispensable to the Democratic nominee’s chances in November, so it is hard to argue that Clinton could shut the union out.

[snip]

Comments from SEIU’s largest local suggest the union is perfectly happy to see Sanders pressing Clinton to take more left-leaning positions. But the labor movement still sees the election solely through the prism of its outcome — not in terms of what Sanders’s candidacy represents, or makes possible.

That narrow electoralism could end up harming Fight for 15 — not just the union’s most important campaign, but arguably the most important labor battle happening today. SEIU’s decision to provide the financial largesse for Fight for 15 comes from the indisputably correct observation that unless the labor movement can bring millions of low-wage workers into its fold, organized labor is scheduled for expiry.

Yet before the endorsement announcement, SEIU President Mary Kay Henry toldAl Jazeera that though the union is expecting “candidates up and down the ticket who are willing to get in the streets and champion this demand,” support for a $15 minimum wage is not a “litmus test” but an “aspirational demand.”

Over the last three years, SEIU has spent tens of millions of dollars and galvanized the labor movement around an inspiring fight. It has justified this enormous expenditure to its members by correctly arguing that they won’t be able to protect and improve their own standards unless something is done to boost the wages of the worst paid workers.

But if the union actually believed it could win on this issue — if it believed it could lead — then a litmus test is exactly what it would be. Clinton would just have to get in line. Members and non-members have shown that they are willing to fight for $15 and a union. What does it say to them if they now are asked to knock on doors calling for $12 and a Clinton?

That is, Hillary’s pluralist table, which leaves little space for the overwhelming majority of workers who aren’t represented by a union, had already dealt away the key policy platform the key voice pulling up to that table has pursued.

Partly that’s a testament to the desperation of unions — that they’re willing to trade their key issues even to get a seat at the table, and partly that’s a testament to the lack of representation for most workers who might sit there.

But having set the table like that, there’s little prospect the large numbers of workers who haven’t been as active in Democratic politics of late will have much sway in face of the powerful banks who don’t appear to have traded away key issues for their time with Hillary.

Notably: these lower income voters, along with the more widely noted younger voters, are precisely those whom Bernie is winning (though as the primary moves to more racially diverse states, that is expected to change).

There’s a key failing in the pluralist vision painted by Chait (even taking it on its face): even to win a seat at the table, labor — and really just that fraction of workers who enjoy union representation — had already started compromising, well before the bankers even sat down for their scotch.

And no matter how this primary ends up, that’s not something that’s sustainable, particularly not in the wake of the financial disaster that pushed so many people closer to the edge. If Clinton is going to win with a pluralist table, there needs to be, for both electoral and social justice reasons, a seat, a lot of seats, for all the workers who have fallen by the electoral wayside in recent years. Bernie has gotten their attention. What does Hillary plan to do to keep it?

The Virgin Birth of Obama’s Wonk Core

January 29, 2016/15 Comments/in 2016 Presidential Election /by emptywheel

There’s a telling paragraph in this post from Ezra Klein, one of a series of posts written lately by self-described “wonks” defending the electoral and political approach Hillary Clinton embraces.

It’s a vision that is intuitively plausible to many liberals because it resonates with their own experience. They remember being excited by the promise of Obama’s agenda and then disappointed by the compromises he made, the fights he backed away from, the deals he cut with industry. They remember being organized in 2008 and demoralized in 2010. They remember feeling like they could accomplish anything, only to be told they needed to stop hoping for so much.

The argument is that something about the first years of Obama’s Administration led people to be more realistic in their political expectations. It comes after two more paragraphs characterizing Sanders’ vision of his own break with Obama: mobilization of voters.

“The major political, strategic difference I have with Obama,” Sanders told Vox’s Andrew Prokop in 2014, “is it’s too late to do anything inside the Beltway. You gotta take your case to the American people, mobilize them, and organize them at the grassroots level in a way that we have never done before.”

This is the vision Sanders is selling in Iowa. It’s a vision that is hopeful both in its diagnosis of the problems in American politics and in its prescription. It’s a vision that says liberals were right all along, and the American people have always been with them, and it’s the corrosive influence of corporate donors that has snapped that bond and confused the country.

But Ezra then turns that vision of mobilization into something with a very short history: just back to 2008, when Obama mobilized voters to get elected but then disappointed them in 2010.

Curiously, Ezra doesn’t describe what demoralized liberals in 2010 — I’m not actually sure whether he means the final shape of the health insurance reform or the electoral losses that year (the size of which were exacerbated by the politics of the health insurance reform). That, of course, is critical to any consideration of the efficacy of pragmatism, because if making pragmatic choices ends up losing historic majorities in Congress, pragmatism will always be a loser for liberals.

But it’s the assumptions Ezra makes in the paragraph that really strike me (they seem, in part, to be based on a story Norm Scheiber wrote in 2014 about former Obama precinct captains from Iowa, which is crazy in that the story and Ezra’s interview based on it were entirely premised on Hillary being unstoppable this time around): that something about Obama’s campaign was uniquely exciting, uniquely promising to liberals and therefore his compromises in office were newly disappointing. That assumption that Obama’s campaign was uniquely exciting really puzzles me. After all, presidential candidates have been exciting voters, including newly active voters, since at least JFK (or, in Hillary’s case, Goldwater). And while those inspired by Kennedy are unique (in that he didn’t live long enough to disappoint them), for all others, there’s always a hangover, after which people take many different paths: disillusionment, integration within the larger party, or excitement by some other candidate in some future race. So why would Obama be different (aside from the fact he’s black, which is important, but certainly not the main thing that inspired even black voters)?

I was so puzzled I actually double checked Ezra’s age because it seemed like something someone who had never voted before 2008 might say, but (as I vaguely recall), even Young Ezra was not only old enough, but quite active, in the 2004 campaign, where a guy named Howard Dean lost in Iowa, but went on to dedicate four years to mobilizing Democratic voters across the country, until Obama replaced the man whose efforts helped to get him elected.

Those years that came before are critically important, too, because they represent a period when the decline of unions — the Democrats’ former method of mass mobilization and still very much a crutch for the party — and the rise of the mobilized Christian right made Republicans newly competitive in presidential elections. And while Hillary’s husband definitely inspired his own share of newly excited voters, the response to the decline of Democrats’ natural mobilized base led to a new kind of Democratic politics, reliant on big donations and lots of TV. We needed Dean to refocus on organizing because the Democratic party had led local organizing to atrophy, which was all the more devastating given the rise of ALEC and with it a machine to help conservatives dominate legislative elections at the state level.

Which brings me to the other curious admission in Ezra’s piece: that even as Hillary-favoring “wonks” beat up on Bernie supporters for their foolish idealism, Hillary herself doesn’t have a plan to challenge Republican dominance.

The problem for Clinton is that the immediate future looks grim for the progressive agenda, and she knows it. Republicans are likely to hold both the House and the Senate. They have a 5-4 majority on the Supreme Court and, at least for the moment, huge majorities in governorships and state legislatures. Americans are, if anything, growing more divided. Money is an ever more powerful force in American politics. The fact that voters don’t want a fight doesn’t mean they’re not going to have one.

Clinton doesn’t have an easy answer for any of this, and, perhaps to her credit, she’s refused to pretend otherwise. Democrats were bitterly disappointed by the compromises Obama made when he had huge Democratic majorities. The compromises the next Democratic president will have to make, given the likely Republican dominance of Congress, are going to be even more brutal for liberals — and if they’re not, it will likely be because nothing of importance gets done in the first place.

Let me clear: there’s not an easy answer to reverse the work Republicans have been doing since Reagan “changed the rules.” There’s definitely not a quick answer. But if liberals don’t start doing the work now, the apparent blind faith among some in the Democratic party that 2020’s census will magically reverse the political order will fail (if the country doesn’t fail worse before then). Though, as I note, Trump’s candidacy is itself changing the rules, in ways Democrats could well capitalize on if they stopped ignoring it.

The thing is, it’s no secret how to change things: it does remain organizing, and outside of some pre-existing institution of civil society (whether that be unions or evangelical churches), that organizing is going to require both inspiration and a commitment to issues that will benefit the masses of ordinary people.

Pessimism about how much the current Congress will get done may be realistic, but it is no more realistic than the assessment that mobilizing the people who’ve gotten screwed by Republican policies is a necessary antidote.