“There’s something wrong,” she told a crowd of Iowans, “when hedge fund managers pay lower taxes than nurses or the truckers I saw on I-80 when I was driving here over the last two days.”
Oh, right, that. The infamous carried interest tax break, the one that allows private equity vampires like Mitt Romney and Stephen Schwartzman to pay a top tax rate of 15 percent while all of the rest of us (including the truckers Hillary “saw” – note she didn’t say “hung out with Bill and me over chilled shrimp at the Water Club”) pay income taxes.
The carried interest loophole is an absurd, completely unjustifiable handout to the not merely well-off but filthy rich, and it’s been law in this country for about three decades.
Raise your hand if you really think that Hillary Clinton is going to repeal the carried interest tax break.
We’ll come back to that in a minute. In the meantime, the reaction to Hillary’s campaign announcement went exactly according to script. Newspapers and news sites ever-so-slightly raised figurative eyebrows at the tone of Hillary’s announcement, remarking upon its “populist” flair.
This is no plutocrat who plans to ride to the White House upon a historically massive assload of corporate money, the papers declared, this is a candidate of the people!
“Hillary’s Return: Her Folksy, Populist Re-Entry,” proclaimed Politico. “Populist Theme, Convivial In Tone!” headlined the Los Angeles Times. “Hillary Lifts Populist Spirits,” commented The Hill, hook visibly protruding from its reportorial fish-mouth.
Having watched this campaign-reporting process from both the inside and the outside for a long time now, I knew what was coming after the initial wave of “Hillary the Populist!” stories.
In presidential politics, every time a candidate on either the left or the right veers in a populist direction – usually with immediate success, since the American populace is ready to run through a wall for anyone who makes the obvious observation that they’re being screwed by someone up above – it takes about two or three days before the “Let’s let cooler heads prevail!” editorials start trickling in.
These chin-scratching op-eds arrive on time every time, like clockwork. They declare that populism is all well and good, and of course a necessary strategy for getting elected, but the “reality” is that once in office, one has to govern.
And since the people are a stupid, angry mob, these op-eds say, and don’t know how to govern themselves, the politician will have to abandon the populism sooner or later.
Then there’s another kind of “cooler heads” editorial. This one makes note of the candidate’s populist rhetoric, and maybe even applauds it as good solid political strategy.
But then the editorialist quietly reassures us that these speeches are all a pose, and that once in office, the candidate will revert back to being the shamelessly bought-off creature of billionaire interests he or she always has been.
So it was with Hillary this week. Just days after she came out shaking a fist to an announcement routine that transparently read like a medley of Elizabeth Warren’s greatest stump hits, the press started with their “cooler heads prevail” pieces.
“How Hillary Clinton Found Her Populist Side (And Why She’ll Have to Lose It)” declared James Kirchick of the Spectator.
Kirchick’s amusing thesis is that Hillary’s decision to harp on the income inequality thing is misplaced not only because Hillary and her husband have made more than the CEOs she’s blasting in her speeches, but because Americans actually like rich people:
Americans, unlike Europeans, do not hate the rich. We want to be them, not soak them. Perhaps the winning strategy for Hillary, then, is to quit the unconvincing pose of being one of the little guys and stop apologizing for and explaining away her wealth. That, after all, would be the American way.
Then there were the “Don’t worry, she doesn’t mean it!” pieces.
“Hillary Clinton’s Wall Street Backers: We Get It,” announced Politico, which polled Democrat-leaning Wall Streeters about the anti-wealthy rhetoric and reassured us that none of them took her seriously.
It’s “just politics,” said one major Democratic donor on Wall Street, explaining that some of her Wall Street supporters doubt she would push hard for closing the carried interest loophole as president, a policy she promoted when she last ran in 2008.
Yes, back to that, the carried interest issue. Promising, and then failing, to repeal the carried interest tax break is fast becoming a Democratic tradition, so much so that I’m beginning to wonder if not fixing this problem is an intentional move, designed to ensure that Democrats always have something to run on in election seasons.
In both the 2008 and 2012 election cycles, Barack Obama either decried the tax “trick” or overtly promised to close the loophole.
Obama’s remarks about carried interest pretty much always sound exactly like Hillary’s remarks this week. He gave a Rose Garden speech in 2011, in advance of his race against Romney, in which he rejected “the notion that asking a hedge fund manager to pay the same tax rate as a plumber or teacher is class warfare.”
But Obama and the Democrats never really did anything about the loophole, even when they had the power to do so. And if you go back, you will find “cooler heads prevail” pieces popped up every time the president mentioned carried interest.
“Carried Interest and the Limits of Populism,” an Examiner piece from last year, was typical: it noted that the tax break “sounds” unfair, but that if you look at the details, you’ll find that such incentives are really at the core of capitalism and are what make America work, etc.
It doesn’t matter that these op-eds usually come in the conservative or centrist press. They’re part of a psychological cycle, designed to make voters think that the things that they really want, like tax fairness or prosecution of white collar crooks or ends to wars or illegal surveillance or torture or whatever, are just pie-in-the-sky aims that inevitably perish when they run into the “reality” of governance.
The campaign season is a time of promises. Election and subsequent rule, we are to understand, are a time of disappointments, coupled with the behind-the-scenes repayment in favors for financial support – usually described to us using more gentle names like “pragmatism” or “reality.”
Editorialists like to talk about the two things, ideals and reality, as totally separate and distinct. Idealism, the stuff of campaign promises, is usually pooh-poohed as “purity politics,” while the cold transactional politics of Beltway dealmaking and incremental change are usually applauded as “pragmatism.”
On the campaign trail, reporters (and I’ve seen this with my own eyes) have a clear bias against idealistic candidates, and often bombard them early in the campaign with “This candidate can’t win in the general election” pieces.
So it was with Howard Dean and even Mike Huckabee, where reporters for some reason worried on behalf of voters about the fact that the candidates’ idealistic, populist rhetoric was so sincere that it might turn off the big-money wings of their own parties, making them non-viable and “unserious” going forward.
Meanwhile, campaign-trail reporters love candidates like John Kerry and John McCain, politicians who can sound like idealistic outsiders but have proven credentials as Beltway whores. These are the candidates who in Goldilocks terms are neither too idealistic nor too transparently come off as oligarchs, but are the “just right” amount of blowhard, the kind with the “look of a frontrunner.”
All of which is a roundabout way of saying that Hillary’s first official week as a presidential candidate went exactly as her handlers must have hoped.
At launch she talked a streak of anti-elitist rhetoric that was taken seriously for a few days, until the punditry took the temperature of her populism and declared to it be the right kind: the fake kind, the purely strategic kind.
The congoscenti even seemed to applaud Clinton for sounding enough like Elizabeth Warren to preclude the necessity of the actual Elizabeth Warren running for president, Warren being the wrong kind of populist, the real kind.
The punditry should embrace the real idealists and hammer the fakes. Instead we get this sleazy process in which the fakes are called smart and yet still allowed to market themselves as the real thing. It would be nice, for once, if we did things in reverse.