Giving Credit

Over the last four years, Paul Krugman has been a harsh critic of the Obama administration -- not because it has failed to cut the deficit -- but because it has not made job creation its prime objective. However, as Obama starts his second term, Krugman praises the president for his accomplishments:

He hasn’t delivered everything his supporters wanted, and at times the survival of his achievements seemed very much in doubt. But if progressives look at where we are as the second term begins, they’ll find grounds for a lot of (qualified) satisfaction.

Krugman writes that Obama has succeeded in three key areas:

Progressives have been trying to get some form of universal health insurance since the days of Harry Truman; they’ve finally succeeded.

True, this wasn’t the health reform many were looking for. Rather than simply providing health insurance to everyone by extending Medicare to cover the whole population, we’ve constructed a Rube Goldberg device of regulations and subsidies that will cost more than single-payer and have many more cracks for people to fall through.

On the issue of inequality,  the results have been disappointing. But Obama has made some progress:

That said, health reform will provide substantial aid to the bottom half of the income distribution, paid for largely through new taxes targeted on the top 1 percent, and the “fiscal cliff” deal further raises taxes on the affluent. Over all, 1-percenters will see their after-tax income fall around 6 percent; for the top tenth of a percent, the hit rises to around 9 percent. This will reverse only a fraction of the huge upward redistribution that has taken place since 1980, but it’s not trivial. 

And, finally, there is the question of financial reform:

The Dodd-Frank reform bill is often disparaged as toothless, and it’s certainly not the kind of dramatic regime change one might have hoped for after runaway bankers brought the world economy to its knees.

Still, if plutocratic rage is any indication, the reform isn’t as toothless as all that. And Wall Street put its money where its mouth is. For example, hedge funds strongly favored Mr. Obama in 2008 — but in 2012 they gave three-quarters of their money to Republicans (and lost). 

The jury is still out on Mr. Obama. But he has another four years to leave a legacy. In the end, as Martin Luther King suggested, he will not be judged by the colour of his skin but by the content of his character.

This entry is cross posted at The Moderate Voice.