What If Obama Were the New FDR ?

Are there traces of the New Deal in the current US administration? President Obama, so often reprimanded for his economic interventionism by the republican opposition to to the point of being accused of socialism, can he be seen as a heir of Franklin Delano Roosevelt? At first sight, the parallels are not obvious. The New Deal did not match the current Fed's expansionary stance in monetary policy, and Obama, unlike FDR, has not launched major public spending programs. However, attitudes and proclivities of the Obama administration have elements of that tradition, since it revives the great democratic tradition of the 20th century.

The latter aspect emerges from the pages of the book that describes the modus operandi of the Obama team, looking at the forms of government intervention achieved during the trough of the crisis. The book in question was authored by Steven Rattner and is titled Overhaul. An Insider's Account of the Obama Administration's Emergency Rescue of the Auto Industry (Boston-New York, Houghton Mifflin Harcourt, 2010). Rattner, a former journalist who went to work on Wall Street, where he became a successful investment banker, is the man chosen to lead the task force appointed by Obama at the start of his mandate to rescue two of Detroit's Big Three: General Motors and Chrysler, whose survival was seriously threatened.

Rattner was put in charge of an agile organization with a time-limited mandate created within the Treasury, whose mission was to organize and manage the $82 billion bailout: the largest in US postwar history. It was a very difficult task which Rattner successfully accomplished, who renounced to a Wall Street's million-dollar bonuses and burdened himself with huge responsibilities for a modest government salary. What puts the automotive industry task force in the tradition of the New Deal is the fact that it was a special agency, acting in relative autonomy with respect to the presidential administration and thus capable of rapid and flexible decision-making. Also, Rattner in a sense revived that triangular structure between Big Government, Big Business and Big Labor that was a feature of the New Deal, since he had to maneuver between the GM and Chrysler executives and the still powerful UAW, the union of auto workers born during the New Deal that had helped Obama win the election in the Midwest. And there were furious car dealers, stockholders and bondholders to be appeased, as they feared to lose everything.

The system was not one of direct government regulation or control. It was in effect a system of bargaining among the various actors brokered by the task force. It was a method that stressed interdependence rather than coercive regulation. A forward-looking vision of an organized and dynamic pluralism, which revives the great lessons of the liberal tradition of the 1900s.