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Friday, November 21, 2003

Howard Dean and the Progressive Agenda

I haven't said much about Howard Dean lately, so let me touch on a couple of news items that caught my attention.

First, everyone presumably knows about the confederate flag flap triggered by Dean's comments during a debate. People also know about his partial retraction, presumably.

But do they know about the repair measures he's pursued? For example, Maryland Representative Elijah Cummings, chairman of the Congressional Black Caucus, is expected to endorse Dean in the next few days. In a recent interview with the Baltimore Sun, Cummings called Dean "somebody who can energize our base" and "the kind of candidate we need to run for president."

I'm not certain how much these kinds of endorsements make, but politicians obviously think they are valuable. Cummings, by chance, is coming to my University to speak in the near future and I hope to learn more about his views on Dean. I'll blog about it I learn anything valuable.

Second, Dean announced this past week that he intends to re-regulate various industries in an attempt to ward off Enron-style corporate abuses and to prevent further media concentration. Libertarians, predictably, are up in arms about this even though many would agree that corporate abuses need to be addressed.

The libertarian line isn't all that far from the Democratic Leadership Council's , which wants to find market-based ways to overcome corporate abuses.

Is the answer to market failure even more markets? Perhaps, but what is the answer? Even the libertarian writer Megan McArdle, discussing Dean's plan, acknowledges that the answer is quite evasive. After all, she "would be surprised indeed to find that he has solved a problem that is still worrying some of the finest minds in finance and economics."

Perhaps the answer is targeted regulation. It does seem like a good idea to prevent too much concentration of media power. Utility de-regulation did have some horrible consequences as Enron and the California energy disaster (which are related problems) demonstrated -- not to mention WorldCom. Plus, unregulated stock options are a big problem that helped promote the bubble economy of the late 1990s.

Dean's fellow Democrats (like Wesley Clark and Joe Lieberman) blasted him right away without allowing much time for real discussion of his plan. Indeed, Clark has said at times that he was motivated to run in part by Enron and problems he had observed first-hand in investment banking.

After reading just a small bit about Dean's plans, I wonder if Nobel winner Joseph Stiglitz is behind them? Last year's anti-globalization book has been following by this year's The Roaring Nineties that debunks many myths about the 1990s' economy. He slams telecom deregulation, apparently. The American Prospect's book reviewer summarizes a key Stiglitz claim:
He shared a 2001 Nobel Prize in Economic Science for his pathbreaking contributions to the concept that markets function imperfectly, hurting many people, because the information available to market participants is inadequate. So government has to intervene, adroitly through rules and regulations, to make markets function properly.
Stiglitz, unlike Dean, doesn't seem to be such a stickler for deficit reduction, so maybe I'm seeing something that doesn't exist. Obviously, I'd be right if Stiglitz (with cause) joined the Economists for Dean That website, by the way, has been giving a lot of play to the mutual fund scandal, which also fits into this picture (as Paul Krugman readers know).

Alert to my friends supporting Kucinich, Braun or Sharpton: this is a progressive and populist idea Dean is pursuing. It's worth examining in more detail.

For that reason, I wouldn't mind reading Brad DeLong's take on Dean's plans. Brad?

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