At a moment when President Obama is seeking to convince Americans that the economy is finally back on track, Sen. Elizabeth Warren (D-Mass.) delivered a major address Wednesday in which she argued that average Americans are being left behind because Washington has failed them.
In a speech to an AFL-CIO conference in Washington, Warren ticked off a list of upbeat indicators: Corporate profits and economic growth are up. The unemployment rate is down. Inflation remains low. And the stock market is booming.
“But the overall picture doesn’t tell us much about what’s happening at ground level to tens of millions of Americans,” she said. “Despite these cheery numbers, America’s middle class is in deep trouble.”
Warren’s speech before the labor federation’s National Summit on Raising Wages, scheduled more than a month ago, fell on the day that Obama went to Detroit to highlight the recovery of the auto industry.
“America’s resurgence is real. Don’t let anybody tell you otherwise,” he said, adding that “if we all pitch in, then we can make sure that this rising tide is actually lifting all the boats, not just some. We can make sure that the middle class is the engine that powers American prosperity for decades to come.”
The difference may be largely a matter of emphasis, but the contrast highlights a dilemma facing Democrats as they set about framing their economic message going into the 2016 election season: Should they take credit for the rebound or tell people still struggling that the party’s leaders feel their pain?
“There’s a delicate line that has to be walked here,” said Mark S. Mellman, chief executive of the Mellman Group, a polling and political consulting firm for Democratic candidates. “No question people are feeling better, but not everybody is feeling a lot better.”
He said that “talking up the economy” would help people feel better and that “the better they feel, the better they feel about the president and Democrats.” But he said there is a danger that those people who don’t feel better about the economy will conclude that party leaders are simply “out of touch with their circumstances.”
Warren’s speech came at a politically charged time. The Democratic Party is already looking to 2016, with former secretary of state Hillary Rodham Clinton likely to declare her candidacy and many party activists looking to Warren as an alternative. Even if Warren doesn’t run, her popularity and message could influence the rhetoric of the ultimate party standard-bearer.
Obama, without having to worry about another election, is using the megaphone of his office to claim credit for the recovery, which gained speed at the end of 2014 after puttering along at a modest and inconsistent pace. His visit to Detroit on Wednesday was part of a warm-up lap around the country before his State of the Union address Jan 20. The president is scheduled to stop in Phoenix on Thursday to draw attention to the resurgence of the housing market and to discuss education and jobs during a visit to Tennessee on Friday.
The president has trumpeted a record 57 straight months of job growth. He notes that 2014 was the strongest year for job creation since the 1990s and that job growth in high-paying industries meant that wages were “on the rise again.”
Asked whether it was “morning in America” — President Ronald Reagan’s campaign theme when running for reelection in 1984 — Jason Furman, chairman of Obama’s Council of Economic Advisers, demurred recently.
“I’m not saying it’s morning in America. I think we’re digging our way out of a really deep hole, and we’re still not all the way out of that hole,” he said in a mid-December press briefing. “Wages are certainly not all the way to where they want to be, but absolutely moving in the right direction.”
Warren has a different take on recent advances.
“A lot of broad national economic statistics say our economy is getting better, and it is true that the economy overall is recovering from the terrible crash of 2008,” Warren said in Wednesday’s speech. “But there have been deep structural changes in this economy, changes that have gone on for more than 30 years, changes that have cut out hardworking, middle-class families from sharing in this overall growth.”
Warren faulted Washington — including leaders of her party — for buying into “trickle-down policies,” such as deregulation and tax cuts for the wealthy. She said such measures benefited corporations and the wealthy in the futile hope that they “could be counted on to create an economy that would work for everyone else.”
Nothing in Warren’s critique was new.
“Making the economy work for everybody. This is the core of why people have voted for Democrats since the Great Depression,” Mellman said. “The exact formulation of the message can change, but the core idea is the same one Democrats have been about since the Depression, and there’s no sense in changing it now.”
Moreover, Austan Goolsbee, professor of economics at the University of Chicago’s business school and chairman of the Council of Economic Advisers during Obama’s first term, warned that the recovery might not last until 2016.
“If you take the risk of the slowdown in China and the continued risk of a financial crisis in Europe, I think that’s fairly sobering even if the United States is gradually standing up a little stronger.” He said “the chances of extended 5 percent [gross domestic product] growth seem not that high.”
Many liberals are hoping that Warren will reconsider declarations that she will not challenge likely candidate Clinton for the 2016 Democratic presidential nomination.
The progressive organization MoveOn.org last month announced the start of what it says will be a $1 million campaign by its members to draft Warren.
Warren — an outspoken critic of Washington’s coziness with Wall Street — is admired by many in the party’s base for her ability to frame an argument that the system is rigged against the interests of ordinary workers. That kind of message, some say, is what was missing during the 2014 midterm elections, which turned out to be a disaster for Democrats.
Such is Warren’s appeal — and her fundraising prowess — that Senate Democrats created a position in their leadership for the first-term senator from Massachusetts.
But the effort to bring her inside the tent has not made her any less willing to engage in battles, even against more senior figures in her party.
In the waning days of the lame-duck session, she opposed a spending bill that included a provision to weaken part of the 2010 Dodd-Frank legislation that tightened oversight of Wall Street. She also is a leading opponent of the White House’s bid to appoint investment banker Antonio Weiss to a top position in the Treasury Department.
Warren’s rhetoric, along with the need to boost turnout among the Democratic base, may have already pushed Clinton’s economic rhetoric to the left. During the 2014 midterm elections, Clinton combined personal anecdotes about the difficulties faced by working women with a lament that too many working people lack economic security. Her speeches became more partisan as Election Day neared and the probability of heavy Democratic losses became clearer.
“We have spent years now clawing our way back, out of the hole that was dug in 2008, but we have a lot more to do if we want to release our full potential and make sure that American families finally feel the rewards of recovery,” Clinton said while stumping for Democratic gubernatorial candidate Tom Wolf in Pennsylvania.
She appeared alongside Warren once during the midterm campaign season and said she admires Warren’s zeal. She also appeared to borrow a page from Warren’s anti-Wall Street message, a tricky issue for Clinton as a former New York senator with deep and lucrative ties to the corporate and financial elite. Moreover, some of Warren’s targets — bank deregulation and free-trade agreements — were put in place by Bill Clinton when he was president.
In the same Pennsylvania speech Clinton said that “corporations seem to have all the rights and none of the responsibilities” of ordinary Americans, while “working people haven’t had a raise in over a decade, and it becomes harder and harder.”
Wolf was among the few Democrats who appeared with Clinton and went on to win last year.
Since then, Clinton has quietly sought advice from a range of business, civic and philanthropic leaders about the main challenges they see in their respective spheres, people familiar with some of those meetings said. The private discussions are one way Clinton is honing an economic message that will attempt to combine optimism about the improving economy with an appeal to working- and middle-class voters who feel left out of the recovery.
“This story is at the center of where the presidential race is going to be,” said former Obama political strategist Bill Burton. “The economy is undoubtedly doing better as a whole, but if the middle class doesn’t feel it, then that is the opening through which the winner of the next presidential election will walk.”