The American political scene since 2000 is conventionally depicted in high colour. For much native—not to speak of foreign—opinion, the country has cartwheeled from brutish reaction under one ruler, presiding over disaster at home and abroad, to the most inspiring hope of progress since the New Deal under another, personifying all that is finest in the nation; to others, a spectre not even American. For still others, the polarization of opinion they represent is cause for despair, or alternatively comfort in the awakening of hitherto marginalized identities to the threshold of a new majority. The tints change by the light in which they are seen.
For a steadier view of US politics, line is more reliable than colour. It is the parameters of the system of which its episodes are features that require consideration. These compose a set of four determinants. The first, and far the most fundamental, of these, is the historical regime of accumulation in question, governing the returns on capital and rate of growth of the economy. The second are structural shifts in the sociology of the electorate distributed between the two political parties. The third are cultural mutations in the value-system at large within the society. Fourth and last—the residual—are the aims of the active minorities in the voter-base of each party. The political upshot at any given point of time can be described, short-hand, as a resultant of this unequal quartet of forces in motion.
What remains unchanging, on the other hand, is the monochrome ideological universe in which the system is plunged: an all-capitalist order, without a hint of social-democratic weakness or independent political organization by labour.  The two parties that inhabit it, Republican and Democratic, have exchanged social and regional bases more than once since the Civil War, without either ever questioning the rule of capital. Since the 1930s there has been a general, if not invariable, tendency for those at the bottom of the income pyramid—should they cast a ballot, which large numbers do not—to vote Democrat, and those at the top, Republican. Such preferences reflect the policies by and large pursued by the two parties: Democratic administrations have typically been more redistributive downwards than Republican, in an alignment shadowing, without exactly reproducing, divisions between left and right elsewhere. But these are rarely differences of principle. A salient feature of the consensus on which the system rests is the flexibility of relative positions it allows. Policies associated with one party can migrate to the other, not infrequently assuming forms in the cross-over more radical than they possessed in their original habitat. A glance at the history of the past half-century is a reminder of these eddies within the system.
Although it was some time before its character crystallized, Roosevelt’s victory in 1932 famously opened a new era in American politics. The Depression, marking the end of a regime of accumulation based on the gold standard, high tariffs, low taxation and still early forms of mass production, discredited the Republicans who had long dominated it. Under the shock of the slump, popular pressures—above all, the labour strikes that began in 1934—drove the Democratic Administration beyond its initial measures of financial stabilization and emergency relief towards social reforms and infrastructural programmes that consolidated its electoral base, while the shake-out of least competitive capitals and corporate concentration continued.  When the sharp recession of 1937 struck, unemployment was soon back up at 12.5 per cent. What transformed the New Deal into the watershed it became was the arrival of massive state demand with rearmament. With the onset of a full war economy, from late 1941 onwards, a new regime of accumulation came of age. The gold standard had gone. Taxation was higher; deficits were no longer taboo; deposit insurance and banking regulation were in place; corporations had concentrated; consumer demand had expanded. These were conditions of the transformation. But the decisive change came with the huge jump in state spending and intervention in the economy, public expenditures soaring from 19 per cent to 47 per cent in two years, when the country was mobilized for war and business returned to the seats of power in Washington to run the industrial drive for victory. Firing technological innovation and wiping out unemployment, the war-time boom delivered American supremacy over the capitalist world after 1945, with an international economic order to fit its requirements at Bretton Woods. The expansion unleashed by the war economy rolled on for a quarter-century of high growth rates at home and unchallenged hegemony abroad.
The political system formed under this regime, though it descended from the New Deal, also differed from it. After the war the Democrats maintained the electoral dominance they had secured in the thirties, when they won first-time voters and second-generation immigrants, once-distant Protestant workers and northern blacks, while keeping a tight grip on their historic stronghold in the racist South. While the two parties divided control of the White House evenly, from 1948 to 1968 each winning it three times, Congress remained for nearly half a century a Democratic preserve; between 1932 and 1980, the Republicans took it just twice, for a pittance of four years. But the underlying political configuration encompassed both parties. After 1937, when the steel strike was broken and the economy slid back into recession, the labour insurgency that had forced the most significant social reforms onto Roosevelt’s agenda was spent. The Wagner Act allowed unionization to increase up to the early fifties; but along with growth in membership came bureaucratization and domestication of the AFL–CIO. In 1947, a majority in both parties joined forces to repress militants and strikes with the Taft–Hartley Act. 
Collective labour was one thing, to be curbed wherever it risked becoming unruly. Atomized voters were another, to be courted so long as the price could be afforded. If state spending as a proportion of GDP was no longer at war-time levels, the long boom of the fifties and sixties yielded rates of profit permitting regular wage gains for workers, and tax revenues for continuing public works and social benefits, along with large military budgets. But no regime of accumulation is static, and in due course there was an inflexion. War-time planners in Washington had envisaged a post-war world in which a dollar standard and free trade would deliver export prosperity for US capital via economic recovery in Europe and Japan. The extent of damage in former allies and enemies alike, and the over-riding imperatives of the Cold War, forced this design out of shape. To save capitalism abroad, pure free trade would have to be diluted, local rulers allowed some start-up assistance and a measure of protection for their markets, if they were not to sink back into depression. Recovery came, and as anticipated, American profits with it. But since labour costs were lower abroad, it was more rational for US capital to invest—where possible: Europe rather than Japan—locally in production for local markets, typically at higher rates of profit than available in domestic investment, rather than export to them. With the great expansion of American multi-national corporations overseas, organized labour was further weakened, not legislatively but structurally, from the mid-fifties onwards.
Yet so long as the overall regime of accumulation held, the calculus of party competition kept the parameters inherited from the New Deal in place. Within them, Republican rulers were perfectly capable of outflanking Democratic predecessors. Truman, whose Presidency was largely barren of domestic legislative achievement, broke more strikes than Eisenhower, whose Interstate Highway Act launched the biggest public-works programme since the WPA. Anti-segregation activism and ghetto insurrections wrested the Civil Rights Act and the War on Poverty from LBJ, with a momentum that outlasted him. It was Nixon, not Johnson, who oversaw the largest increase in social entitlements and economic regulation of post-war history, and proposed the most ambitious anti-poverty scheme, a guaranteed minimum income that no capitalist country has yet instituted. At Congressional level, where in both Houses the most rock-solid single bloc of Democrats was always from the South, Republicans voted in larger numbers than Democrats for the civil-rights bills.
Across the advanced capitalist world, the post-war boom came to an abrupt halt in the early seventies. Profitability declined, wages ceased to rise, and stagflation set in. The common cause lay in the inter-capitalist competition that had been intensifying since Germany and Japan, restored by Washington as forward defences of the Free World, had re-entered the world market in force, often with newer capital stock and superior corporate and banking structures. Forced to defend sunk capital that could not readily be written off, American firms faced lower margins just as unwelcome social spending and costly regulation were hitting a peak under a Republican president. To cap everything, after cutting the link of the dollar to gold, Nixon resorted to wage and price controls to throttle inflation. Faced with this combination of economic crisis and political profligacy, capital—big and small—sprang into action. The Business Roundtable was set up in 1972. By the end of the decade the Chamber of Commerce and National Federation of Independent Business had doubled their membership, and corporate lobbyists in Washington multiplied over ten-fold; political action committees funded by capital far outdistanced those of labour, and hard-hitting new think-tanks—the American Enterprise Institute, Heritage Foundation, Cato Institute—were at battle stations.  The breakdown of steady growth generated a systematic mobilization against the post-war settlement.
Such was the setting in which the agenda of a new regime of accumulation took shape. The neo-liberal order ahead would include deregulation of markets, de-unionization of labour, decreases in taxation and deflation of the money supply—in effect, a reversion towards norms of the original liberal regime prior to the Depression, minus the gold standard and tariff protection. But there would be two critical differences, in the position of industry and the nature of the electorate. Manufacturing, just burgeoning into mass production in the twenties, with fifty years of expansion ahead of it, would from the eighties onwards contract relentlessly under the pressure of lower-cost producers abroad, displacing capital into finance as the command-centre of the economy, and yet more drastically eroding the position of labour. At the same time voter expectations now precluded wholesale liquidation of insolvent or inefficient enterprises: mass unemployment appeared incompatible with stable capitalist rule. In most capitalist countries of the period, analogous changes took hold. But in the absence of any significant traditions critical of the over-riding prerogatives of private property and free enterprise, and the structural erosion of the power of labour, in America they acquired their purest form. The parameters of the political system shifted to the right everywhere in the West, but nowhere so far and with so little impediment as in the US.
At party level, after a high tide of progressive reform under a Republican president, the backwash of political reaction came with a Democrat in the White House, and an overwhelming Democratic majority—292–143 in the House and 62–38 in the Senate—in Congress. Less state, more market was the solution to the woes of the economy at the arrival of the bicentennial. The keynotes of the Carter Administration were tight money and deregulation, to weaken labour and strengthen business. In Congress, the Democrats lowered the capital-gains tax and raised the payroll levy, while—in one vote after another—rejecting reform of health care, indexation of the minimum wage, consumer protection and improvement of electoral registration. At the Fed, Volcker was entrusted with a hard deflation. Neo-liberalism was now in the saddle. The short-term cost for Carter and his party was high, when the steep interest rates that were Volcker’s cure for inflation provoked a severe recession. The electorate was not grateful. But a larger problem lay in the lack of an ideological message from the Democrats capable of embellishing the turn in any terms less dour than the need for belt-tightening. Something more alluring was needed.
Reagan’s victory in 1980, as decisive as Roosevelt’s in 1932, met the requirement. Neo-liberalism found its popular supplement in an optimism of national reassertion and moralism of individual self-reliance, laced—if not excessively—with faith in the Bible.  This was an ideological encapsulation with which the Democrats were hard put to compete. Though they had pioneered the neo-liberal turn, they were handicapped by identification with the order that had preceded it, in which they had so long been the dominant party. The Republicans, with no comparable difficulty of adjustment, became the natural party of government in a political system whose centre of gravity had shifted structurally to the right. The new regime of accumulation favoured them.
Behind the shift in partisan ascendancy lay also sociological changes. The first of these affected the white working class. Hard-hat backlash against anti-war demonstrations and school bussing had already produced a patriotic and racial vote for Wallace in 1968, and a greater one for Nixon in 1972. But with real wages falling after 1972, and fiscal creep biting into take-home pay, workers now also had fewer material reasons for loyalty to the Democratic Party. Carter had abandoned them. Many abandoned him. Reagan won a majority of them in 1980 and a much larger one in 1984. The second change was the shift in population and wealth from the Northeast and Centre of the country to the West and Southwest, where capital was newer and less trammelled, urban patterns more dispersed, traditions of labour organization weaker and frontier imaginaries stronger. There, in California, a revolt against property taxes of home-owners financed by real-estate developers had already passed Proposition 13, putting Carter’s Revenue Act of the same year in the shade. For a century, no presidential candidate had ever come from the region. Then from the same springboard came Goldwater, Nixon and Reagan. Finally and most decisively, the South—always the most conservative part of the country, which the memory of Lincoln’s victory in the Civil War had for a century made a Democratic bastion—had started to become Republican in the aftermath of Johnson’s conversion to civil rights. Its transfer as a regional bloc from one party to the other, the largest single shift in the electorate since Abolition, was gradual. Thirty years later, when the South was posting the fastest economic growth in the country, it would be close to total.
Sweeping victory at the polls on a platform of freeing enterprise from government at home, and re-establishing American power and confidence abroad, gave Reagan a mandate for a radical shift in what was possible to enact in Washington. Without delay, he pushed through the most far-reaching overhaul of the tax structure on record—lowering rates for all, but heavily weighted towards the rich—and broke the first national strike that came his way, by the air-traffic controllers’ union. These were highly popular moves, enjoying bipartisan support and wide public approval. But though a great political success, the tax-cuts were no remedy for the Volcker recession, and had to be partly retracted, before another round followed in Reagan’s second term. But neo-liberal recipes could no more be taken pure economically than ideologically: in practice, a large dose of military Keynesianism was required to keep growth going, as steep increases in defence expenditure primed demand, generating annual deficits three times higher than under Carter. After 1985, the shake-out of the Volcker recession and a lowering of the dollar, combined with wage-repression and fiscal hand-outs, allowed manufacturing exports to recover, restoring corporate profitability. Yet the performance of the American economy did not substantially improve. The initially high dollar, attracting foreign capital, accelerated the rise of the financial sector and widened the trade deficit. Overall growth was less than in the seventies. By the end of the Reagan era, its epilogue under the first Bush, the federal debt had tripled. The underlying impasse of the long downturn had not been resolved.
The Democrats were meanwhile adjusting to the parameters of the new order, as the Republicans had done to the old one. Within a year of Reagan’s re-election in 1984, the Democratic Leadership Council was formed to reposition the party in line with the requirements of the time—shedding outdated commitments to public spending, labour or welfare dependents for a ‘new centrism’, champion of a leaner state at home and a more resolute one abroad. By the turn of the nineties, mass movements of any kind—labour, student, black, feminist, rainbow—had vanished from the scene. Picked by the media as the most reassuring candidate from the DLC, Clinton took the Presidency in 1992 on a split vote, Perot dividing the Republican electorate in a recession year. Once in the White House, he took the opposite path to Reagan—raising taxes to reduce the deficit, in the belief that bond markets held the key to business confidence as the engine of growth. Welfare reform, disciplining outlays to dependents, sent another strong signal to the markets that this was a responsible Administration. The recession faded, the budget went into surplus, and at the end of Clinton’s second term, the economy expanded at a hectic clip.
But the boom was no healthier than Reagan’s, since the debt expunged from the public accounts reappeared, vastly magnified, in private accounts, household and corporate, in the wake of the financial deregulation that became the signature drive of the Clinton Presidency. The repeal of Glass–Steagall demolished New Deal separation of investment from retail banking, and the Commodity Futures Modernization Act lifted any restraint on trades in over-the-counter derivatives.  With a return to the high dollar, foreign capital flooded into the stock market, while profitability in manufacturing declined once again. In the artificial flush of Clinton’s last years, mortgage liabilities were stoked by lavish government loans, corporations borrowed against their own share prices, speculation in hi-tech start-ups exploded, and equities soared. Effectively, asset-price Keynesianism had replaced fiscal-military Keynesianism, doping domestic demand enough to return briefly to higher growth.
Behind this change lay an inflexion in the regime of accumulation operative since the early eighties, comparable to that of the mid-fifties in the antecedent regime. Once again, the change came from abroad. This time it was the full-scale entry of China into the world market that governed it—lowering labour costs dramatically across manufacturing; at once widening and bank-rolling the American trade deficit; propelling US assembly-lines out to China; fuelling fictive capital at home.  The Reverse Plaza Accord of 1995 to revalue the dollar proved the tipping-point, at once for outsourcing of manufacturing to the PRC and insourcing of money for the stock and real-estate bubbles of the end of the century. In contrast to the thirties and eighties, but in this too like the fifties, the change was not primed by an intellectual model, but presented on a plate by global conditions. Banks and corporations, hedge funds and start-ups reaped the benefits of the planetary expansion of the world-capitalist economy under American monetary domination, extolled ex post facto as ‘globalization’, and ‘the great moderation’. The inflexion was not a departure from the neo-liberal order as conceived in Vienna, Chicago or Minnesota, but a deepening of it.
Politically, Clintonism appeared to have made Democratic rule competitive with Republican under conditions at the outset less favourable to it: not only speeding up financialization of the economy, while restoring budgetary balance, but transmitting a glow of prosperity to the modest as well as the opulent. In 1996 bankers and voters alike gave thumbs up to the President for a second term, Clinton raising more money than Dole on Wall Street, and taking thirty-one states and close to half the electorate: not a triumph on Reagan’s scale, but healthy enough, with a promisingly wide gender gap—11 per cent—as pledge for the party’s future. Ideologically, the discourse of a Third Way reconciling economic freedom with social cohesion, fortunes for the rich and side-payments for the poor, had superior appeal in a post-Cold War period when uncontested American primacy, with the disappearance of the Evil Empire, made national self-assertion less pressing an issue in popular sensibility. By every standard measure, another Democratic success should have followed.
Clinton’s fellations in the White House, however, cost the party the election of 2000. The contingency of a sexual bavure let the Republicans back in by an infinitesimal margin. Yet it so happened that a victory won by such a chance crystallized a value-division of increasing intensity. Since the sixties, a more or less bohemian counter-culture had developed in the US, rejecting conventional mores and beliefs. Radicalized by opposition to the war in Vietnam, it had served as a convenient target for Nixon to rally a silent majority of law-abiding patriots to his cause. With the fading of war in Indochina as an issue, depoliticization of this area set in. From the late seventies onwards, much of what was once a counter-culture migrated into a less rigidly regimented, vaguely bien-pensant sector of mainstream bourgeois life itself, where market forces normalized flouting of traditional taboos into profitable forms of repressive de-sublimation. This mutation, of which Clinton could be taken as a tawdry emblem, catalysed a vehement reaction in the ranks of low-denomination religion, pitting no longer a ‘silent’ but a ‘moral’ majority—in reality another minority, of evangelicals—against godless subversion of right living. Self-conceived as conservative, these groups became over time shock troops of Republican electoral mobilization, propelling contrary forces—sympathy for LGBT would be a short-hand today—into the Democratic camp. Here, it is widely believed, lay one root of an increasing polarization of the political system. 
In 2000 Bush was a beneficiary of this tension. But his campaign was moderate in tone and its success was not due to any overt appeal to religious zeal: capture of independent voters, not turn-out of the already committed, gave him the White House. By 2004, this had changed: his three-million-vote victory came in good part from all-out mobilization by the evangelical base the Republican Party could now rely on. But between the base of the party and its high command there remained a significant distance. Belying its reputation as a regime of the radical right, the Bush Presidency was in general domestically pragmatic, not reversing but adapting to the inflexion of neo-liberal accumulation—and legitimation—bequeathed by Clinton. Confronted with the same economic difficulties as his two predecessors—at inauguration, a business-cycle recession; throughout, the intractable pressures of the long downturn—Bush presided over a combination of the fiscal giveaways and military Keynesianism of the first with the asset-price Keynesianism of the second: public deficits triple the size of Reagan’s, and a mortgage spree on top of Clinton’s, taking housing debt to $11 trillion at a time when the GDP of the country was around $14 trillion. Three tax-cuts exceeded Reagan’s record in size, if not quite in the extent—pronounced enough—of their tilt towards wealth. Bankruptcy laws were tightened to favour creditors. An aggressive bid to privatize parts of Social Security, an idea already floated by Clinton, came to nothing. With bipartisan support, civil liberties were cut back and defence expenditures doubled.
But like that of the Democratic Administration before it, at home the neo-liberalism of the Republican regime was compensatory in design, requiring its ideological supplement. Sub-prime mortgages, manna for packagers and bankers presented as help to the disadvantaged, were a typical inheritance from Clinton. But however large these would loom economically, they required a social agenda alongside them. Bush had been elected on a slogan of compassionate conservatism, and in office paid his respects to it. The No Child Left Behind Act increased federal spending on education more than any government since the War on Poverty. The Medicare Prescription Bill—in the words of a Democratic observer, ‘a massive expansion of the entitlement state’—was the largest extension of health care since the time of Johnson. Even immigration reform, to regularize the position of illegal entrants and tighten employer use of them, though blocked by opposition in Congress—principally but not exclusively from his own party—was attempted by Bush. In the wake of mega-scandals left by financial deregulation—Enron, WorldCom—the Sarbanes–Oxley bill instituted weak checks on corporate fraud, rather than actively enabling it as Rubin and Summers had done. The overall social record was not one of die-hard reaction.
Macro-economically, the direction was set at the Federal Reserve, where Greenspan backed the new round of tax-cuts as a stimulus to growth, lowered interest rates repeatedly to sustain equity prices, and encouraged the spread of sub-primes. But the financial bubble created in the nineties could not be extended forever. In the autumn of 2008, the reckoning came on Bush’s watch. Amid general panic at the collapse at Lehman, a meltdown of the banking system was averted only through emergency purchase by the Treasury of $400 billion of assets at risk on Wall Street. The debacle, an end-product of the Clinton era, ensured the rout of McCain a few weeks later.
Democratic victory at the polls, however, was more than a reflex of the crash. It corresponded to a gradual sea-change in the sociology of the electorate, under way since the nineties and long predicted to alter the balance of partisan forces in times to come. The hard-hats won by Nixon and Reagan had shrunk: between 1980 and 2010, the proportion of whites without college education dropped from 70 to 40 per cent. The size of the non-white electorate—black, brown and yellow—had doubled since Clinton had won it in 1992, from 13 to 26 per cent. Since then, no Republican has won a majority of its fastest-growing segment, Hispanics. Most important of all, women had started voting in greater numbers than men in the eighties, and from the nineties onwards, not only has a large majority invariably voted Democratic, but their turn-out has increased disproportionately. In 2008, some ten million more women cast a ballot than men. To these demographic dividends were added the gradually cumulative effects of cultural deregulation, as marriage rates tumbled and professions of faith declined. In the fifties, over 90 per cent of American voters under thirty were married; today, less than 30 per cent. Married couples now form only 45 per cent of households, those with children just 20 per cent. More than a quarter of the population no longer describes itself as Christian. 
Such corset-loosening—compatible, of course, with any amount of market-friendly conformism—has gone furthest in the two groups historically most affected by the domestication of the counter-culture, youth and wealthy professionals, each now a key Democratic vote-bank. Crucially, it has also wrenched apart the Sunbelt: California, the most populous state in the nation, becoming overwhelmingly Democratic in the mid-nineties, just as the South became overwhelmingly Republican. The net effect of these changes has been to replace what was once something like class politics with what is now closer to identity politics, as the basis of coalition-formation and electoral mobilization. In the process, traditional income determinations have been losing their salience, or warping into their opposite.  Emblematically, in 2008 a majority of white voters living on less than $50,000 a year voted for McCain, a majority earning over $200,000 a year for Obama. Four years later, eight out of the ten richest counties in the country voted for Obama. In every one of these cradles of plutocracy, his margin of victory was greater than the national average. 
Financial crisis, demographic change, socio-cultural permutation: at the dusk of the Bush Presidency, all favoured the Democrats. To these the candidate added his own symbolic charge. Obama won the nomination in 2008 because the Democratic Party—for which, like the Republican, first-past-the-post rules, inherited from a pre-modern English oligarchy, form an untouchable system of political closure in the public arena—had for the first time mandated proportional representation in all of its primaries. Had traditional winner-takes-all rules applied, Clinton’s wife, scooping the pool in seven out of ten of the largest state delegations,  would have won the nomination with ease. In the event, the rule-change produced the perfect candidate for the hour: not only younger, cooler and more eloquent, but magnetic for the minorities on which victory depended. Image, which in a politics of the spectacle always matters more than reality, normally requires projection. But here, in the perception of colour, it was literal, allowing edifying legend (an autobiography under contract before even graduation) to develop around reality with unusual speed and ease.
Personification of national triumph over race prejudice, vindication of the American dream of success possible for all, devout yet moderate reconciler of divisions, bearer of hope to the disregarded and afflicted, Obama could serve as a hold for any number of uplifting popular identifications. Remote from any ghetto, his actual background and trajectory—like McCain, product of one of the overseas outposts of turn-of-the-century US imperialism (Panama, Hawaii); tutelary grandmother, first female vice-president of a bank in the country; educated at one of America’s top private schools (Punahou is worth around $1 billion); passage through Columbia and Harvard—could only be irrelevant to these. Once invested with the authority of office, looks and aplomb have generated a celebrity ruler—colour relaying style to yield a JFK for a multi-cultural age, attracting much the same kind of engouement in the local intelligentsia and its counterparts abroad. In the electorate at large, colour remains more divisive, but its equations have altered. There, in the net partisan balance, a racism that is still widespread, if now largely unspoken, has moved from being a surreptitious asset to a clear-cut liability. Among voters, the prospect of the first only half-white President attracted less hostility than a vision of the first half-black one aroused enthusiasm.
The bearing of colour, critical in delivering victory to Obama at the polls, has been minimal on his record in office. One out of five male blacks has continued to know incarceration under his rule, without a word from the White House on their fate. The indices of black unemployment and poverty have not budged. The business of the Democratic Administration has lain elsewhere. Its first concern was necessarily containment of the financial crisis: the banks had been bailed out under Bush, but in the wake of the crash the economy was in free fall. To check the drop, an emergency stimulus of $800 billion—the American Recovery and Reinvestment Act—was rushed through, of which tax cuts were once again the largest single component (37 per cent). But this time assorted expenditure on infrastructure, research, energy and social needs made up nearly half the total (45 per cent), for a package hailed by its admirers as a ‘New New Deal’.  Reform of health care, at which Clinton had stumbled, was the next priority. With the backing of the insurance industry and the AMA, and a filibuster-proof Democratic majority in Congress, Obama could now pass an Affordable Care Act seeking to make health coverage universal, and reduce costs enough to pay for itself. To avert further financial mayhem, the Dodd–Frank Bill multiplied new agencies for the oversight of Wall Street, and duties for the existing agencies. To maintain vigilance against terrorism, the Administration extended wire-tapping without warrants under the Patriot Act. Last but not least, the military budget, running at $629 billion when Bush left office, rose yet further under Obama, to $707 billion by 2012. The public debt, $10.7 trillion in 2008, had jumped to nearly $16 trillion by the end of his first term.
How little the parameters of the political system had shifted with the reversion to Democratic tenure of the White House can be seen by the degree of continuity in the agendas of the Bush and Obama presidencies. Both rulers, like Reagan before them, took office in a recession and responded with tax-cuts to goose the economy. Both presided over weak measures to rein in financial excesses. Both extended health-care benefits to gain social support. Both increased federal funding on education. Both sought reform of immigration. Both hiked military spending, and curbed civil liberties. Both escalated the deficit. The principal difference has lain in the size and direction of the side-payments each partisan variant has made, within a framework set by the joint requirements of business confidence and voter appeasement, in conditions of deteriorating economic performance. Under the Republican Administration, the ideological supplement sustaining the regime became a hyperbolic nationalism, powering the strike-back against 9/11, and covering a fiscal tilt to the rich. By 2008, the length and outcome of successive overseas expeditions had exhausted this formula, clearing the space for a Democratic alternative somewhat closer to Bush’s original appeal, what in the local idiom might be called ‘compassionate liberalism’, covering an increase in public expenditure and a fiscal tilt towards the less well-off.
The political difference was sufficient to put Obama back into the White House in 2012. But it scarcely alters the boundary-markers in place since the days of Carter and Reagan. The scattered disbursements of the federal stimulus, often undercut by fiscal contraction at state level, have left most of their recipients cold. The centre-piece of Democratic reform, the Affordable Health Care Act, is a much more ambitious scheme than Bush’s Medicare Prescription bill. But it is cast in the same mould: an extension of social benefits in exchange for a bonanza to the private health-care industry—the pharmaceutical corporations, their over-priced drugs guaranteed a state-subsidized market in one case; the insurance companies, their over-charged customers expanded by