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Democrats must regain the moderates

By Ed Gresser, Special to CNN
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STORY HIGHLIGHTS
  • Ed Gresser: Economy, good but unpopular Democratic policies helped GOP win
  • But Dems made mistakes: Appeasement, lack of plan for private sector growth, he writes
  • Gresser says moderates who helped get Democrats elected swung GOP this year
  • They want growth based on private-sector investment, exports, innovation, he says

Editor's note: Ed Gresser is president of the Democratic Leadership Council, a non-profit organization of moderate Democrats, and director of the DLC's Project on Trade and Global Markets.

(CNN) -- A pretty awful night for us Democrats, after a brief two years in power. Why? Difficult circumstances are part of the story. So is the price for good but unpopular policy.

But the party also made mistakes, recovering a reputation for freely spending public money, neglecting to chart a path away from emergency stimulus and back to growth led by the private sector, and letting fear of intra-party controversy keep some growth opportunities on the shelf. The public reacted unhappily; we need to accept the verdict and make some changes.

Some appreciation first, though: President Obama and the 111th Congress came to Washington to do big things, and achieved many of them. While responding to an economic crisis and managing two inherited wars, they oversaw a historic reform of health policy, new policies for student loans and K-12 education, improved trade adjustment assistance and broadened support for scientific research. These are major achievements in which Democrats can take pride.

But the public nonetheless responded with a Bronx cheer, turning about 60 House seats, six Senate seats and nine governors' mansions over to the Republicans. Had Republicans nominated more moderate Senate candidates in a few races, it could have been worse.

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Why? CNN's exit polls show that the reason was not a decision by political liberals to stay home: They made up 20 percent of the vote, the same as in 2006. Instead, it was a big shift in the votes of political moderates. In 2006, moderates voted for Democratic House candidates by 22 million to 14 million. This year the pool shrank, with the exit poll suggesting that about 6 million one-time moderates shifted to the conservative side and gave the election to the Republicans.

Why? Objective conditions are a partial explanation. With 14.5 million Americans out of work -- down from the mid-2009 peak but falling only slowly -- the mood is bad. Midterm elections are often (though not always) tough on an incumbent president's party, and big House majorities meant Democrats held shaky territory. And some gutsy, correct and unpopular policy decisions -- the auto rescue, continuation of TARP and Afghanistan troop commitment are examples -- took a toll.

But Democrats knew the landscape was bad and prepared well, with strong fundraising and early campaigning. And polling suggests the public still blames the Bush era rather than the Obama team for the grim economy. So objective conditions aren't the whole answer -- we need to look at ourselves as well.

Political moderates are aspirational, pragmatic and see an important but limited role for government in economic life. For them, Democrats' inability or unwillingness to chart a long-term path away from emergency stimulus revived a pre-Clinton reputation for carefree attitudes toward public money. President Obama himself analyzes the consequences acutely:

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"That accumulation of numbers on the TV screen night in and night out in those first six months I think deeply and legitimately troubled people. ... They started feeling like: Gosh, here we are tightening our belts, we're cutting out restaurants, we're cutting out our gym memberships, in some cases we're not buying new clothes for the kids. And here we've got these folks in Washington who just seem to be printing money and spending it like nobody's business."

The lack of a path back to growth led by the private sector, meanwhile, led many moderates to see Democrats as inclined to look to government rather than inventors and entrepreneurs as the source of growth, prone to arguing with business, and willing to leave some potential sources of growth -- notably export promotion through trade negotiations -- off the table to avoid intra-party conflict.

These are major achievements in which Democrats can take pride. But the public nonetheless responded with a Bronx cheer.
--Ed Gresser
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Where to from here? Democrats should be chastened, self-critical, but not despairing. Similar midterm beatings did not presage defeat for Ronald Reagan in 1984, nor for Bill Clinton in 1996. Rather, economic recovery and (in Clinton's case) a pragmatic, pro-growth policy record combined with Republican overreach led to easy re-elections.

This time around, no Democrat should count on an overreaching Republican Party to rescue us again. Instead the party's challenge is to regain the confidence of American moderates.

Moderates worry about the country's financial health, and want to see a credible route back out of emergency deficits and toward fiscal balance.

Moderates want a credible plan for growth, based on private-sector investment, exports and innovation. The administration needs to provide both. One opportunity comes next month, when the administration gets recommendations on fiscal balance from the White House's Fiscal Responsibility and Debt Reduction Commission. Another, during the president's Asia trip this month, is the president's commitment to finish unsettled parts of the U.S.-Korea Free Trade Agreement. Others will come up in coming months.

For now, Democrats need to accept a bad night and respond. An appropriate place to start might be an adaption of the president's 2008 campaign slogan: Don't lose hope -- but do change.

The opinions in this commentary are solely those of Ed Gresser.