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George Bush's legacy
The frat boy ships out
Jan 15th 2009 From T h e E c o n o m i s t
F e w p e o p l e w i l l m o u r n t h e d e p a r t u r e o f t h e 4 3 r d p r e s i d e n t
HE LEAVES the White House as one of the least popular and most divisive presidents in American history. At home, his approval rating has been stuck in the 20s for months; abroad, George Bush has presided over the most catastrophic collapse in America’s reputation since the second world war. The American economy is in deep recession, brought on by a crisis that forced Mr. Bush to preside over huge and unpopular bail-outs.
America is embroiled in two wars, one of which Mr. Bush launched against the tide of world opinion. The Bush family name, once among the most illustrious in American political life, is now so tainted that Jeb, George’s younger brother, recently decided not to run for the Senate from Florida. A Bush relative describes family gatherings as “funeral wakes”.
Few people would have predicted this litany of disasters when Mr. Bush ran for the presidency in 2000. True, the 2000 election was likely to be divisive because of the peculiar arithmetic of the outcome (Mr. Bush lost the popular vote to Al Gore by 500,000 votes, then won a disputed recount in Florida by a few hundred). But for most people Mr. Bush was a pretty acceptable choice, and certainly not a crusader-in-waiting.
He came across as an affable chap, particularly when compared with his uptight rival. Frank Bruni, who covered his election campaign for the New York Times, wrote in 2002 that “the Bush I knew was part scamp and part bumbler, a timeless fraternity boy and heedless cutup, a weekday gym rat and weekend napster.” And the then governor of Texas presented himself as a centrist—a new kind of “compassionate conservative”, a “uniter rather than a divider”, an advocate of a “humble” and restrained foreign policy. The Economist liked this mixture enough to endorse him in 2000.
How did all this change? How did the uniter become a divider? How did Mr. Bush’s governing style shape American politics over the next eight years? And what legacy has the 43rd president left for the 44th?
His supporters—the few that remain—point out that this was a presidency knocked sideways by the terrorist attacks of September 11th 2001, which no one foresaw. The huge expansion of government and executive power under Mr. Bush, and the prosecution of a disastrous war, all unrolled in the wake of those attacks. The financial crisis, which began with overvalued homes and sloppily underwritten mortgages, was the product of numerous forces and failures in which Mr. Bush was not a major contributor; they included low interest rates, bankers’ reckless risk-taking, flawed regulation and consumers’ bubble mentality, all of which spanned borders.
Yet Mr. Bush’s presidency was also poisoned by his own ambition. Mr. Bruni’s “timeless fraternity boy” wanted to be a great president. He not only wanted to win the second term that Bill Clinton had denied to his father—though that mattered to him enormously. He also wanted to usher in a period of prolonged Republican hegemony, much as William McKinley had done for his party in the late 19th century. After the September 11th attacks he not only itched to destroy al-Qaeda and the Taliban. He also wanted to tackle the root causes of terrorism in the Middle East. Mr. Bush frequently spoke about how much he hated anything that was “small ball”. His close advisers repeatedly described him as a “transformative president”.
Mr. Bush’s role model throughout his presidency was not his father but the patron saint of the modern conservative movement, Ronald Reagan. He regarded Reagan as a man who had unleashed free-enterprise and defeated the Soviet Empire, and he tried to do the same with his huge tax cuts and his global war on terror. He mimicked Reagan’s Western style, even relaxing on a Texas ranch where Reagan had taken his holidays on a Californian one; and he echoed Reagan’s enthusiastic use of the word “evil”.
Other facets of Mr. Bush’s personality mixed with his vaulting ambition to undermine his presidency. Mr. Bush is what the British call an inverted snob. A scion of one of America’s most powerful families, he is a devotee of sunbelt populism; a product of Yale and Harvard Business School, he is a scourge of eggheads. Mr. Bush is a convert to an evangelical Christianity that emphasises emotion—particularly the intensely emotional experience of being born again—over ratiocination. He also styled himself, much like Reagan, as a decider rather than a details man; many people who met him were astonished by what they described as his “lack of inquisitiveness” and his general “passivity”.
This led Mr. Bush to distrust the Washington establishment, and even to believe that establishment wisdom was probably wrong simply by virtue of what it was. Fred Barnes, a conservative journalist, entitled his book on Mr. Bush “Rebel in Chief”. He quotes one Bush confidante as saying: “One tux a term. That’s our idea of outreach to the Washington community.”
Lack of curiosity also led Mr. Bush to suspect intellectuals in general and academic experts in particular. David Frum, who wrote speeches for Mr. Bush during his first term, noted that “conspicuous intelligence seemed actively unwelcome in the Bush White House”. The Bush cabinet was “solid and reliable”, but contained no “really high-powered brains”. Karen Hughes, one of his closest advisers, “rarely read books and distrusted people who did”. Ron Suskind, a journalist, has argued that Mr. Bush created a “faith-based presidency” in which decisions, precisely because they were based on faith, could not be revised subsequently.
For the good of the party
Mr. Bush relied heavily on a small inner core of advisers. The most important of these was Dick Cheney, who quickly became the most powerful vice-president in American history. Mr. Cheney used his mastery of bureaucracy to fill the administration with his protégés and to control the flow of information to the president. He pushed Mr. Bush forcefully to the right on everything from global warming to the invasion of Iraq; he also fought ruthlessly to expand the power of the executive branch, which he thought had been dangerously restricted since Watergate.
The two other decisive figures were Karl Rove, Mr. Bush’s longtime political guru, and Donald Rumsfeld, his defense secretary. Mr. Rove was obsessed by pursuing his dream of a rolling Republican realignment, subordinating everything to party politics. Mr. Rumsfeld regarded the Iraq war not, like his boss, as an exercise in democracy-building, but as an opportunity to test the model of an “agile military” that he was pioneering at the Pentagon.
The fruit of all this can be seen in the three most notable characteristics of the Bush presidency: partisanship, politicization and incompetence. Mr. Bush was the most partisan president in living memory. He was content to be president of half the country—a leader who fused his roles of head of state and leader of his party. He devoted his presidency to feeding the Republican coalition that elected him.
The most important legislation of his first year in office was a $1.35 trillion tax cut that handed an extra $53,000 to the top 1% of earners. At his farewell press conference on January 12th Mr. Bush called his tax cuts the “right course of action”, as if they were an unpopular but heroic decision. They weren’t. The budget was in surplus in 2000, and both Mr. Bush’s main Republican rival, John McCain, and his Democratic opponent, Mr. Gore, also wanted to cut taxes, but by less, so as to pay down more debt and shore up Social Security (public pensions). Mr. Bush’s much larger tax cut reflected his, and his party’s, belief that lower taxes restrain the size of government, empower individuals and are good for both growth and Republican prospects.
Cheney, the string-puller
Sean Wilentz, a historian at Princeton, remarks how unusual it is for a president to have politicised such a national catastrophe: “No other president—Lincoln in the civil war, FDR in world war two, John F. Kennedy at critical moments of the cold war—faced with such a monumental set of military and political circumstances, failed to embrace the opposing political party to help wage a truly national struggle. But Bush shut out and even demonised the Democrats.”
The invasion of Iraq was like much else in the Bush years—an initial triumph that contained the seeds of disaster. Thomas Ricks, the author of “Fiasco”, argues that “the US-led invasion was launched recklessly, with a flawed plan for war and a worse approach to occupation.” Mr. Rumsfeld’s decision to invade with too few troops led inexorably to the breakdown of law and order, which turned the Iraqi population against the Americans, and to the Abu Ghraib scandal, which solidified world opinion against America. But Mr. Bush responded to the unfolding disaster with a mixture of denial and stubbornness, refusing to force Mr. Rumsfeld to adjust his plans. He engaged in an absurd photo-op to declare “Mission accomplished”, and he also gave medals to three of the architects of the debacle, George Tenet, Tommy Franks and Paul Bremer.
Mr. Bush’s weaknesses were on display again in the second great disaster of his administration, Hurricane Katrina, which struck New Orleans in August 2005. The hurricane exposed Mr. Bush’s congenital passivity: he did not visit New Orleans until five days later, after first viewing the damage from the safety of Air Force One. It also exposed the consequences of filling your administration with third-rate hacks. The head of the Federal Emergency Management Agency, Michael Brown, a former commissioner for the International Arabian Horse Association, made a hash of dealing with the disaster but nevertheless received an encomium from the president—“Brownie, you’re doing a heckuva job”—that rang around the country.
The Truman hope
How will Mr. Bush be judged in the light of history? “Many historians”, says Princeton’s Mr. Wilentz, “are now wondering whether Bush, in fact, will be remembered as the very worst president in all of American history.” A humbled Mr. Bush counters his critics by pointing out that “You never know what your history is going to be like until long after you’re gone.” He frequently invokes the name of Harry Truman as a president who was dismissed at the time, but is now regarded as one of the greats.
Mr. Bush’s presidency is not without its merits. He supported sensible immigration reform. He proposed tighter regulation of Fannie Mae and Freddie Mac, the now-nationalised mortagage agencies. Congress stymied him on both points. He promoted more members of minorities than any previous president; and he also stood up to the Dixiecrat wing of his party, edging Trent Lott, a Mississippi senator, out of his job as majority leader for segregation-favouring remarks. He maintained good relations with India, Japan and, particularly, Africa, where he launched a $15 billion anti-AIDS programme.
On trade, too, Mr. Bush’s heart was in the right place, though policy was at first subverted by political or strategic priorities. In 2002 he approved tariffs on imported steel to fulfill a promise Mr. Cheney made to steelworkers in West Virginia, a state crucial to his 2000 election. That year he also signed a massive increase in farm subsidies so as not to antagonize farm-state congressmen facing election that autumn. But these early protectionist impulses gave way to a more stalwart defense of trade. Mr. Bush resisted intense pressure from Congress to punish China for keeping its currency low. After Congress narrowly granted him streamlined authority to negotiate treaties, he pushed the Doha global free-trade agreement and a free-trade area of the Americas. These efforts failed in part because of other countries’ intransigence, notably India’s in the case of the Doha round. In the absence of a broader framework, his administration pursued bilateral trade deals, although often with countries chosen for strategic rather than economic value: Oman and Bahrain, for example, which host American military bases.
His administration’s handling of the financial crisis alternated between shaky and competent. Swallowing his visceral scorn for finance, Mr. Bush delegated crisis management to Henry Paulson, his treasury secretary and a former investment banker. Mr. Paulson’s remedies were often blunted by complexity, inconsistency and his insistence that lenders and borrowers pay for their mistakes. His decision to let Lehman Brothers fail significantly intensified the crisis. Still, Mr. Paulson regrouped by pouring hundreds of billions of government dollars into the tottering financial system, which has bought a measure of stability. Mr. Bush backed this, in violation of his own anti-interventionist impulses.
Mr. Bush showed more ability to learn from his mistakes than his critics realize or than he himself might like to admit. The second Bush administration was very different from the first. He reached out to America’s allies, particularly through his second secretary of state, Condoleezza Rice, establishing good relations with France’s Nicolas Sarkozy and Germany’s Angela Merkel; and he also improved his administration’s profile in the world by firing Donald Rumsfeld and sidelining various neoconservatives.
The president’s legendary stubbornness paid off in one area: his decision to ignore Washington’s wise men and increase troop levels in Iraq, rather than preparing for withdrawal, probably averted disaster there and certainly increased stability. There is even a possibility that Mr. Bush’s most controversial decision may eventually be vindicated: if Iraq turns into a beacon of democracy in the Middle East, then he will look much better in a decade’s time than he does today. But that is a big “if”.
Farewell to restraint
Meanwhile, his policy of cutting taxes while increasing spending—of simultaneously pursuing big government and small government—dramatically swelled the deficit. He inherited a projected ten-year surplus of $5.6 trillion and bequeaths a ten-year deficit of $6 trillion, assuming his tax cuts remain in place. Hardly the makings of a positive judgment from future historians.
In pursuit of his fiscal ambitions, Mr. Bush helped roll over or sweep aside long-standing rules and conventions designed to keep the deficit in check. Republicans in Congress pushed through his 2001 and 2003 tax cuts under a parliamentary maneuver called “reconciliation” previously reserved for measures that reduced, or did not increase, the deficit. Doing so largely stripped Democrats of their ability to raise procedural obstacles in the Senate, but also required the tax cuts to expire after ten years. As the projected surpluses melted away, Mr. Bush cut the horizon in his budgets from ten years to five, masking the long-term impact of his policies.
For years the president refused to include the cost of the Afghanistan and Iraq wars in his budget. He also acquiesced in the expiry of 12-year-old budget rules that made it difficult to cut taxes or increase spending if it raised the deficit. In coming years deficit reduction will be hard enough, with the recession-induced collapse in tax collections and the cost of the bail-outs. Jim Horney, a former Democratic congressional staffer now at the liberal Centre on Budget and Policy Priorities, a think-tank, says it has been made even harder by the disappearance of any culture of restraint in Congress.
Mr. Bush’s biggest failure, however, is on entitlements. The ageing of the population, coupled with rapidly rising health-care costs, means that in coming decades Social Security and Medicare benefits will outstrip workers’ payroll contributions by trillions of dollars. Both programs presented Mr. Bush with a political opportunity. To pry elderly voters away from the Democrats, he promised to add a prescription-drug benefit as part of any Medicare reform. He did so in 2003, winning the support of the AARP, the powerful pensioners’ lobby, which has long been seen as closer to the Democrats. But in the end he achieved few cost savings, while adding a staggering $8 trillion to Medicare’s unfunded liability (see chart).
Social Security, founded in the Depression to provide workers with a secure pension, has defied all recent attempts to make it solvent. Although such an attempt was part of Mr. Bush’s first election campaign, it was not solvency that animated him, but the prospect of workers diverting some of their Social Security contributions to private investment accounts. Such accounts were intended as the centerpiece of the Republican Party’s “ownership society”.
Economists are divided on the merit of such accounts, but agree they do nothing to restore solvency: that requires slimmer benefits, higher taxes, or both. Because of the political peril of touching Social Security, broad reform demands bipartisan support. Yet David Walker, the federal government’s chief auditor from 1998 to 2008, says Mr. Bush doomed his own effort, launched after his 2004 re-election, by seeking to shape its outcome from the start. He had appointed an advisory commission whose members first had to agree to support private accounts (which many Democrats oppose). He issued detailed proposals for private accounts while eschewing, until much later, solvency proposals. His administration staged some 200 “town hall” events attended by pre-screened participants, Mr. Walker says, yet at the end of it all support for Mr. Bush’s proposal was lower than when it began.
Between the Medicare drug benefit and the failure to restore solvency to Social Security, the long-term unfunded cost of America’s programs for the elderly had last year reached a stratospheric $43 trillion, or 5% of future wages, compared with $13 trillion, or 3% of future wages, in 2000. Mr. Obama and Congress may still be able to mend entitlements. But they start with a bigger and more imminent danger than Mr. Bush did eight years ago, and one made even harder by the deep hole the current recession has created in the budget.
The costs of ambition
The neoconservatives who had such influence over Mr. Bush argued that unintended consequences were usually more important than the intended ones. The Bush presidency has proved them right in this, if in little else.
A president who labored to produce Republican hegemony ended up dramatically weakening the Republican Party. The Democratic Party is now in a more powerful position than it has been at any time since the second world war. In the Senate, the Democrats have a majority of 59 seats to 41 (including two independents who caucus with the Democrats); in the House, they hold 256 seats to the Republicans’ 178. Americans who came of age during the Bush years identify with the Democrats by the largest majority recorded for any age cohort since the second world war.
A president who believed that America’s global supremacy was guaranteed by America’s unrivalled military power ended up demonstrating the limits of both. Many of America’s closest allies in Europe refused to co-operate with the Iraq war. Many of America’s rivals used America’s travails in Iraq to extend their power: Iran is more powerful than it was in 2000, and closer to acquiring a nuclear bomb; Russia and China have extended their web of alliances and strengthened their regional influence. Mr. Bush’s recalibration of his policies in his second term suggests that even he recognizes that America’s loss of soft power has cost it dear.
The American military machine is under intense strain. The demands of tackling the Iraq insurgency have forced America to short-change Afghanistan. Deployments have grown longer and redeployments more frequent. Recruitment standards are going down. The neoconservative dream of a muscle-bound America knocking down the “axis of evil” and planting democracies from North Korea to Iran looks, more than ever, like an overheated fantasy cooked up in a think-tank.
Finally, Mr. Bush also demonstrated the limits of capitalist triumphalism. The Bush administration was as business-friendly as any in American history: Mr. Bush was the first president with an MBA (from Harvard) and he appointed four CEOs to his cabinet, more than any previous president. The administration was also wedded to the fundamental tenets of Reaganomics: cut taxes and free the supply side and everything else will take care of itself. Mr. Cheney even argued explicitly that “Reagan taught us that deficits don’t matter.”
Mr. Bush now leaves behind a tax system in some ways less efficient than the one he inherited, in need of annual patches, and unable to fund the government even in good times. He also leaves behind a broken budget process. Any economic triumphalism is long gone. Many of the CEOs, most notably Donald Rumsfeld and Paul O’Neill, proved to be dismal administrators. Reaganomics helped to produce a giant deficit. The financial crisis has made re-regulation rather than deregulation the mantra in Washington, while government has acquired a much bigger role in the economy through its backing of banks and car companies.
–noun, plural -cies.
Government by the worst persons; a form of government in which the worst persons are in power
“I inherited a recession, I’m ending on a recession,” he noted at his press conference on January 12th. He wasn’t asking for pity, only to be judged on what happened in between. Unfortunately, that economic legacy is littered with wasted opportunity, bad judgments and politicized policy. The budget surplus he inherited is now a deficit, the fiscal hole in America’s retiree programs is bigger than ever, the tax system is an unstable, patched-up mess.
It is not all his fault. But for the most part, good policy repeatedly took a back seat to Mr. Bush’s overweening political ambition. Both the country and, ultimately, the Republican Party are left the worse for it.
Mr. Bush sold his first tax cut, in 2001, as recession insurance. He did the same in 2003; and though the budget surplus was gone by then, he upped the ante by also lowering taxes on capital gains and dividends. Lower taxes on capital boost investment, but, as one former senior administration official says, that thought was secondary: “It was a political winner that happened to coincide with good economics.” Lower taxes on capital had the potential to bolster a growing “investor class” that tended to vote Republican.
Relentless partisanship led to the politicisation of almost everything Mr. Bush did. He used his first televised address to justify putting strict limits on federal funding for stem-cell research, and used the first veto of his presidency to prevent the expansion of that funding. He appointed two “strict constructionist” judges to the Supreme Court, John Roberts and Samuel Alito, turned his back on the Kyoto protocol, dismissed several international treaties, particularly the anti-ballistic-missile treaty, loosened regulations on firearms and campaigned against gay marriage. His energy policy was written by Mr. Cheney with the help of a handful of cronies from the energy industry. His lackluster attorney-general Alberto Gonzales, who was forced to resign in disgrace, was only the most visible of an army of over-promoted, ideologically vetted homunculi.
Bumbling towards Baghdad
The Iraq war was a case study of what happens when politicisation is mixed with incompetence. A long-standing convention holds that politics stops at the ocean’s edge. But Mr. Bush and his inner circle labeled the Democrats “Defeaticrats” whenever they were reluctant to support extending the war from Afghanistan to Iraq. They manipulated intelligence to demonstrate that Saddam Hussein possessed weapons of mass destruction and had close relations with al-Qaeda. This not only divided a country that had been brought together by September 11th; it also undermined popular support for what Mr. Bush regarded as the central theme of his presidency, the war on terror.
Source: T h e E c o n o m i s t
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