Feb. 7 (Bloomberg) -- President Barack Obama has long aspired to emulate Ronald Reagan in changing the trajectory of American politics. Halfway through his presidency, the evidence is that public opinion is bending Obama’s way.
While Reagan declared that “government is the problem” and vowed to “lighten our punitive tax burden,” Obama won re-election by almost 5 million votes with an opposing vision that calls for federal action to promote equality, require greater sacrifice for those at the top, and address everything from climate change to health insurance.
House Republicans were forced to break with party orthodoxy and accept a tax increase on the wealthy, a plan pushed by Obama and backed by the public. Voter attitudes during the Obama years have shifted in favor of same-sex marriage and a path to citizenship for undocumented immigrants. Even Obama’s health-care law gets majority support among Americans in a recent poll.
As a result, Republican leaders are sounding alarmed as they head into the next round of budget and debt negotiations with Obama: House Speaker John Boehner said the president is out to “annihilate” the Republican Party, while Republican National Committee Chairman Reince Priebus is trying to change the rules for electing the president in 2016.
“Obama has the potential to make the kind of political changes Ronald Reagan did,” said Julian Zelizer, co-author of “Conservatives in Power: The Reagan Years” and a Princeton University history professor. “The long-term effects of his presidency could be very important.”
One major obstacle to Obama’s reaching that goal is the weakness of the economic rebound under the president, who, like Reagan, was faced with a crippling recession.
Republicans for decades have cited the boom under Reagan as proof of the effectiveness of his governing philosophy of low taxes and light government regulation. The economy’s strength was clear by 1985, making his legacy “a little bit” more secure at the time than Obama’s is now, Zelizer said.
The gross domestic product expanded at an average 6.7 percent rate in 1983 and 1984. Under Obama, growth averaged just 1.8 percent for the past two years, including a 0.1 percent contraction in the last three months of 2012.
Still, the conservative shift in U.S. politics linked to Reagan only became fully apparent over time as the election of his vice president, George H.W. Bush, as successor ratified his legacy and the Republican Party gained control of both chambers of Congress in 1994. It was a Democrat, President Bill Clinton, who declared “The era of big government is over” seven years after Reagan left office and who further deregulated the financial industry in 1999.
Even within the White House at the beginning of Reagan’s second term, few advisers appreciated the far-reaching impact his presidency would have, in spite of the Republican’s 49-state re-election victory, said Ken Khachigian, an adviser and speechwriter for the president.
“I don’t think any of us felt that that had been achieved,” Khachigian said. “History has a way of playing out over a generation, not just three or four years.”
While Reagan spent his presidency communicating a vision for limiting the scope of government, Obama used his second inauguration speech on Jan. 21 to present an unabashed case for Washington’s role in promoting equality and protecting Americans’ economic security.
“We do not believe that in this country freedom is reserved for the lucky, or happiness for the few,” Obama said. “We recognize that no matter how responsibly we live our lives, any one of us, at any time, may face a job loss or a sudden illness or a home swept away in a terrible storm.”
The New Republic magazine summed up the address by declaring, “The Word Liberal Makes a Comeback.”
As far back as the 2008 Democratic presidential primary, Obama expressed admiration for Reagan’s ability to capture the spirit of his times and guide the nation in a new direction.
Reagan “changed the trajectory of America in a way that, you know, Richard Nixon did not and in a way that Bill Clinton did not,” he told the Reno (Nevada) Gazette-Journal in January 2008. “He put us on a fundamentally different path because the country was ready for it.”
Reagan reversed an almost half-century-long movement toward expanding government’s role in the economy and society that Franklin Roosevelt began with the New Deal and Lyndon Johnson continued with his Great Society programs. He passed the 1981 tax cuts, continued to deregulate business and set a new tone in labor relations by breaking the national air traffic controllers union, though he allowed federal spending to increase and later had to roll back some of the tax reductions to curb the deficit.
Obama is now turning back toward more government action in addressing economic crises and social ills. His first two years in office, when Democrats controlled both houses of Congress, included an $833 billion economic-stimulus package, direct intervention to support the automobile and clean-energy industries, a financial-regulation package and a health-care law that will expand insurance to tens of millions of Americans.
Just as disaffected white working class voters, those in nonprofessional occupations who lack college degrees, and many Southerners became “Reagan Democrats,” Obama is solidifying Democratic support in an emerging coalition made up of the rising generation of younger Americans and expanding populations of blacks, Hispanics, Asians and college-educated voters.
While Obama’s 51 percent re-election vote is well behind Reagan’s 59 percent in 1984, the Democrat’s 60 percent support among those younger than 30 slightly exceeds Reagan’s edge among the age group. The strongest support for Obama’s Republican opponent, Mitt Romney, came from those 65 and older.
The first few presidential election votes set a pattern for younger voters that usually lasts, said Ruy Teixeira, a senior fellow at the Center for American Progress and co-author of a 2002 book, “The Emerging Democratic Majority,” which argued that long-range demographics favor left-of-center candidates.
“If you start out conservative, you remain fairly conservative; if you start out liberal, you remain fairly liberal,” Teixeira said.
Obama’s mixed-race heritage and his young family also deepen the connection to him among younger voters who have grown up in an era of greater ethnic diversity, Teixeira said.
“He represents and embodies the changes in the country that they see,” he said. “He seems like he’s one of them.”
Still, the loyalty of the emerging electoral coalition will likely only be cemented if the economy grows enough to lift Americans’ living standards, Teixeira said.
The economy under Obama has been good for investors. The benchmark Standard & Poor’s 500 U.S. stock index rose about 75 percent during his first term compared with a 27.5 percent increase during Reagan’s first four years.
Wage-earners haven’t prospered. Real median household income declined to $51,088 in December 2012 from $55,012 when he took office in January 2009, according to an analysis of census data by Sentier Research, an economic-consulting firm in Annapolis, Maryland. Median household income in Reagan’s first term by contrast climbed to $46,215 in 1984 from $45,260 in 1981, U.S. census data show.
“Demographics plus growth equals dominance,” Teixeira said. “He’s got the demographics. If he gets the growth, he’ll get the dominance.”
Another significant difference for the two presidents is the political atmosphere in Washington. Obama has had to overcome a cohesive Republican congressional opposition that has been mostly united in blocking his priorities. Reagan benefited from conservative Southern Democrats, who in some cases broke with party leaders to back his agenda, even though he faced a more hostile Congress in his second term.
The consensus on a number of contentious issues has been changing as Obama has been in the White House.
Fifty-one percent of Americans support same-sex marriage compared with 41 percent three years ago, according to NBC News Wall Street Journal polls taken in December 2012 and October 2009. Sixty-two percent favor a path for illegal immigrants already in the U.S. to become citizens, up from 47 percent in September 2009, according to an Associated Press-GfK Roper Public Affairs poll taken Jan. 10-14.
Sixty percent of voters backed a tax increase on the wealthy, according to exit polls, a centerpiece of Obama’s re-election campaign that congressional Republicans opposed. Support has been growing for Obama’s health-care law, which Romney had vowed to try to repeal. Fifty-one percent of U.S. adults say they favor all or most of the law’s provisions, up from 45 percent two years ago, according to a CNN poll conducted Jan. 14-15.
The longer-term impact of the political shifts in the Obama years will also depend on how subsequent events alter public assessments of his presidency.
The unraveling of the Soviet Empire in the late 1980s and early 1990s burnished Reagan’s reputation, Zelizer said. The overhaul of the tax code that he negotiated with Democratic congressional leaders in 1986 and an immigration bill passed the same year boosted his image as a president capable of working across party lines, he said.
Potential agreements between Obama and congressional Republicans on immigration law, revamping the tax code, or revisions to entitlement programs to curb costs could have a similar effect on Obama’s standing, Zelizer said.
On the other hand, “we still don’t know how Obamacare is going to be implemented,” Khachigian added. “We don’t know how the new tax laws are going to affect the economy. There are a lot of imponderables on the international scene.”
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