By Jeff Fox
The nation’s challenges are not unprecedented but Washington’s political capacity to deal with even the routine business of governing is a cause for great concern, said this year’s winner of an award named for President Harry Truman.
“This situation is worse than anything I’ve seen in a long career in Washington,” Alice M. Rivlin, former vice chair of the Federal Reserve, said Tuesday during a luncheon in Kansas City in which she was given the Truman Medal for Economic Policy.
She spoke warmly of Truman and drew parallels to President Obama, and she walked through America’s economic and political history. Specifically, she said, the nation’s separation of powers and two-party system require debate and compromise – a process she said has entirely broken down.
“I’m afraid we’re in for a period of lurching from crisis to crisis, which is totally unnecessary,” she said.
Rivlin, 82, served in the Lyndon Johnson administration in the 1960s and in 1975 became the first director of the Congressional Budget Office. She was deputy director and then director of the Office of Management and Budget under President Bill Clinton and then was named to the Federal Reserve. She is the fifth recipient of the Truman Medal, which is given every other year, in part to recognize that the Council of Economic Advisors, which serves each president, came into being in 1946, when Truman was in office.
Rivlin said there are striking similarities between Truman and Obama. Both faced intense partisan opposition, both worked hard and were essentially optimistic about America, and both saw themselves as Washington outsiders.
“Both presidents have been vilified by the press and the other party, and both have been called socialists – whatever that means,” she said.
Truman, she pointed out, “embraced the unfinished business of (Franklin Roosevelt’s) New Deal with enthusiasm” and that included national health insurance, which never came to pass and which Truman considered a bitter failure.
“The result of that failure was decades of building a patchwork of a system” that the country has now, she said. The Affordable Care Act, or Obamacare, is “a much more free-market plan than Harry Truman’s,” she said.
Truman left office low in the polls but is today highly regarded, and the country looks back on that time as prosperous and promising. So, Rivlin asked, should we take comfort in Truman’s experience, or is the country so deeply divided that it cannot survive without significant political changes?
“I don’t know,” she said, “but I’m worried.”
By any measure, she said, Americans are more prosperous now than in Truman’s time, when America was emerging from a decade and a half of depression and war. There was, she reminded the audience, a very real fear that the country would go right back into a depression once the war ended.
“The memories of those hardships were fresh,” she said.
Contrast that with today’s slow economic growth, the demographic challenges of an aging population, public anger at government aid for large banks but not for Main Street, and a general sense that the country has become less prosperous, she said.
Still, she said, major issues are solvable. She gave the example of Social Security.
“It isn’t badly broken, and it needs to be put back on a solid foundation,” she said.
But there are obstacles, as evidenced by the current government shutdown. The country has an intentional separation of powers, federalism makes implementation of things such as the Affordable Care Act far more complicated, and the two political parties have moved away from the middle, she said.
“But most important, ‘compromise’ has become a dirty word,” she said.
The Truman Medal is given by four groups: the Harry S. Truman Library Institute (a private, non-profit partner of the Truman Library), the Missouri Council on Economic Education, the Economic Club of Kansas City, and the Henry W. Bloch School of Management at the University of Missouri-Kansas City.