The distinction between these two forms of progressivism is a very old one that was most sharply highlighted in the 1912 Presidential election. In that race you had two progressives running, Theodore Roosevelt and Woodrow Wilson, who articulated very different visions of how progressive aims are to be accomplished. For TR, big corporations needed to be accepted as an inevitable consequence of modernity, but their abuses could be checked through government regulation. For Wilson, under the influence of Louis Brandeis, the problem was existence of such large institutions. They were inevitably corrupting and needed to be broken up if the free market were to function. These debates resurfaced within the Roosevelt administration as competing factions pushed for the NRA-style system of corporatism, with business, government, and labor all working together, and a more straightforward anti-corporate approach. I'm grossly simplifying, but you get the idea.
What's important to remember is that these debates were never resolved. The triumph of Keynesian economics in the postwar era effectively short-circuited the conversation. Liberals in good standing could accept big business and high finance or rail against it in equal measure because the economy was working reasonably well and there were other battles to fight. The current economic crisis, however, so long in the making, is forcing these debates back out into the open. Geithner's plan accepts the continued existence of huge financial firms that are "too big to fail." Some of his critics think that this is a fundamental mistake, that if an institution is too big to fail, it is too big. Citigroup and Goldman Sachs are too large and politically well-connected to regulate effectively, and their activities so permeate the financial sector that if they collapse they'll bring the economy down with it.
I don't have a well thought-out position on the financial crisis or what to do about yet. I think there are reasonable liberals on different sides of the question, and I don't have sufficient expertise to make a clear judgment. But I do think liberalism looks to be at a crossroads, one a hundred years in the making. Either liberals are going to accept the primacy of big business or we're going to go to war against it. I know which side I'm inclined to be on.
I think it's a fault of liberalism to generalize that big business is "bad", when the nation as a whole benefits quite a lot from the existence of big business in many industries. Capitalism and the Free Markets are the cornerstones of this country and we can all benefit from them, whether we participate in them directly or not. The problem, as I see it, is in the extreme manifestations of both, not just in lack of regulation but also in size.By Rebecca, at 12:02 PM
Not only do I agree that "if an institution is too big to fail, it is too big", I also believe that it is dangerous for a company to be allowed to become too big to fail. Dangerous for all of us.
I'm not naive enough to believe that Obama's going to get his wish for bipartisan partnership. In fact, I think he's got enough of a mandate right now that he doesn't even need it, and probably won't for a while.
But, although I usually consider myself liberal almost to an extreme, I don't really want the pendulum to swing all the way over to the other side in a way that ignores practicality. We don't necessarily need more regulation, we need smarter and more realistic regulation.
After the Enron debacle, we legislated measures into effect that have hurt us in the long run. London overtook New York as the financial center of the world, and we sacrificed a lot to pay for mistakes that never should have been allowed to occur. If we continue down that road, it'll be the liberal financial equivalent of the Patriot's Act, or whatever the hell that destruction of civil liberties is called.
In the same way, we have to tread a careful line between unions and big business. Unions exist because of the abuse of workers by management, and this country has benefited greatly because of them. On the other hand, unions became so powerful that they have often implemented abuses of their own that have unnecessarily increased the bottom line of the businesses who employ their workers. We need to keep some objectivity there, as well.
So, although I do embrace the rush to finally achieve all of those ideals nearest and dearest to our liberal hearts, I think we need at least a little bit of the conservative input to keep us from going too far. To keep our feet on the ground, so to speak. The Republicans are pretty much fangless at this point, and let me just say that is such a joy to behold. So it will come down to those pesky conservative Dems to make sure that we don't shoot ourselves in the foot.
Still, there is one final component of our financial recovery that is the giant elephant in the room. All of the countries we are competing with are able to offer lower prices for their products in great part because they do not have the added burden of paying for the health insurance of their employees. The polls have been showing that the general public is now ready to embrace a national health insurance. There is also an organisation of "physicians, medical students and health professionals who support single-payer national health insurance" (www.pnhp.org). It is past time we get this done. And I hope that Obama will retain enough of his political capital to see to it.
I'm worried that he will expend too much of it on Geithner...particularly since I think Geithner's plan is based on a fatally flawed foundation. I still think Obama will manage to help us get through all of this. But I think it will take longer than it could have, otherwise. And that's a real shame considering how bad things are already.
Thanks for the detailed comment. A couple of points. I was trying to make a general point about bigness, but I certainly accept that in some cases bigger is better. What I am concerned about is that an economy dominated by large corporations is going to have a lot of pathologies, which we are seeing right now.By Arbitrista, at 10:13 AM
I would have no problem with a conservatism that balanced liberalism if there were a modern conservatism worth engaging with. But there isn't. As far as I can tell, there's no such thing as reasonable conservatism as a coherent force in American politics. Just look at the ridiculous things those people have been putting forward. Similarly, while there certainly is the potential for union abuses, I would argue that what we face is the virtual absence of unions - we don't have a balance now, but sheer corporate triumphalism.
I couldn't agree more about national health insurance.
I think the key, as we both mentioned, is to keep any individual corporation from becoming TOO large and having the right regulations in place to prevent the pathologies from taking hold.By Rebecca, at 10:57 AM
I absolutely agree, we have been missing a reasonable conservatism for years. But since the Republicans are still clinging to their wingnuttery, I think that this is the best opportunity we'll have for the conservative Dems to get out from under their control and start acting more like Democrats. Voting like they should, as well. Of course, they can only change so much, and that's where I hope the plain old feet on the ground practical conservatism will come from. We can only hope.
I don't quite agree that the unions are an endangered species. It would take a lot more than what we've seen so far just to get rid of the Teamsters, alone. Between Obama and our majorities in Congress, I think unions will emerge stronger and more prevalent than they have ever been before - and I think that's wonderful. I'm just sayin'...extremes are never good, and we want to be careful.
There's a wide middle road here for us to work with, it's not like a thin little line we have to walk. But we want corporate America to start realizing that unsustainable sky high shorter term profits are really not good for anyone, because they lead to situations like we find ourselves now where everyone is suffering. They have to start accepting that the cost of doing business is a little higher when they are required to treat - and pay - workers fairly, but that is what leads to economic stability for the country as a whole.
On the other hand, the unions have to accept that adding to the bottom line unnecessarily doesn't do anyone any good if it causes a business to go under or to become non-union. I don't believe they have been guilty of that, up to now, in spite of the isolated things you hear about here and there. Again, it's just because they've got all the clout of the White House and most of the legislature on their side, that I worry a little about handing them too much power.
Balance and practicality. Careful, well thought out legislation. No extremes. The exact opposite of the last several years. I don't think that's too much to ask.