Left Behind: How Neoliberalism’s Legacy Cost Democrats the 2024 Election

Biden’s real economic reforms were drowned out by the powerful lure of Trump’s promises...

We just elected a guy who’s fine with the planet melting down, kids getting shot in school, insurance companies going back to denying coverage for preexisting conditions, and wants to weaponize the federal government in a way dictators do.

What happened?

Democrats thought the 2024 election would be all about Donald Trump’s embrace of fascism and the future of our democracy. And abortion.

Pretty much all of us thought that. As did most of the news media and pundits.

But now that the exit polls and research are largely in, we’re finding, instead, that the election was all about who’d be best able to “blow up the system.”

By “the system,” voters didn’t mean democracy (although we may get the end of that); they meant the neoliberal system that Ronald Reagan introduced to replace FDR’s New Deal policies in 1981 and was subsequently embraced by Bush, Clinton, Bush, and Obama.

In other words, they said, “We want the jobs like we had before Reagan’s neoliberalism, when one person could support a household.”

If that word intimidates or confuses you (as it does most Americans), here it is broken down: Neoliberalism (as I lay out in The Hidden History of Neoliberalism: How Reaganism Gutted America) combines free trade, low taxes, and an end to the power of unions. Neoliberals typically also embrace open borders, as in the world’s most complete neoliberal experiment that’s called the European Union (which is also in trouble now).

The result of Reagan’s version of neoliberalism has been that good jobs (over 20 million of them) and even entire factories (over 15,000 of them) moved to low-wage countries, unions were destroyed, and wealth exploded at the top while the middle class shrank into near poverty.

In the 2016 primaries, Donald Trump and Bernie Sanders were the first two candidates for either of the two major parties to call for an end to neoliberalism. Americans were enchanted by both.

It’s why people from Joe Rogan to Howard Stern were endorsing Bernie Sanders, and blue-collar workers across the country were taking Trump seriously.

Bernie’s call to end neoliberalism was complete: End the offshoring and bring jobs back, pass Card Check to reinvigorate unions, and raise taxes on the morbidly rich and profitable corporations.

Trump’s call was only partial; while he embraced bringing our jobs and factories back to America, he wanted to keep the neoliberal “reforms” of low taxes on billionaires and an end to union representation. (He went so far as to publicly congratulate Elon Musk on his union-busting/union-preventing activities.)

Sadly, the elders of the Democratic Party had already decided that Hillary Clinton was going to inherit her husband’s neoliberal dynasty so, when voters were confronted with Clinton’s defense of neoliberalism versus Trump’s partial attack on it, they chose the latter. Something’s better than nothing, they seemed to think.

And Trump gave it a shot during his first term, throwing up tariffs in such an incoherent and uninformed way that he provoked an unnecessary trade war with China that cost America hundreds of billions. But at least, voters thought this year, he gave it a shot. Maybe he’ll do better this time around.

Working class people of all races (particularly men) know that neoliberalism sent our jobs overseas, made rich people fantastically rich, and destroyed our unions. Few associate it with Reagan, though, as those policies didn’t really start to bite until the Clinton years.

Still, even not knowing when or where it all started, they hated it. And, we just learned with the outcome of this presidential election, it turns out that voters will tolerate the chance that their kids will get shot, their insurance companies will rip them off, and their government will imprison dissenters in exchange for the promise of the good paying jobs that come with ending neoliberalism.

Back in 2010, I published a book to guide Democrats through policies that could win the 2012 election. Rebooting The American Dream was the book about how to end neoliberalism (although I never used that wonky word) that Bernie Sanders famously read on the floor of the Senate during his 8-hour filibuster of the Bush tax cuts, and got me an invitation to discuss economics in the Obama White House.

The first two chapters are titled Bring My Job Home and Roll Back the Reagan Tax Cuts, followed by calls for an end to corporate union-busting, free college, Medicare for All, reversing Citizens United, immediate action to stop global warming, an end to predatory foreign policy (Iraq, etc.), genuine immigration reform, an end to corporate personhood, and more widespread employee-owned companies.

Bernie had been a guest on my radio program for an hour every Friday, taking and answering questions from listeners, for a full six years at that time (he ended up doing it for eleven years) and we shared a public disgust for Reagan’s — and then Clinton’s and Bush’s — embrace of neoliberalism.

For the 21 years that I’ve been doing my daily radio program I’ve been arguing that illegal immigration hurts working class people (just ask anybody in the construction industry); that we should bring our factories back home and the fastest way to do that is to return to a gradual and rational tariff-based system; and that we need to raise taxes on the morbidly rich and corporations above 50 percent like other developed nations to cap great wealth and incentivize companies to invest in R&D and their employees.

That call has been largely ignored until the last four years.

In a true American political tragedy, Clinton and Obama were so enthralled by neoliberalism they couldn’t even get around to passing Card Check to bring back unions (although both promised to), much less ending job offshoring or meaningfully raising taxes on the morbidly rich.

Those steps would have taken us back to the era when the majority of American workers could buy a home, a car, take an annual vacation, put their kids through school, and retire with dignity on a single paycheck. The era, in other words, that Trump constantly points to, only this time we’d be able to do it without the racial segregation and gay-bashing.

The great irony here is that Joe Biden has been the first president since Jimmy Carter to reject neoliberalism and embrace Bernie’s and FDR’s New Deal system of government and Keynesian economics:
— He’s kept most of Trump’s tariffs in place and added a bunch of his own.
— He raised taxes on corporations and billionaires significantly.
— He tightened up the border and wanted to sign a major reform of our immigration system.
— He was the first president in history to walk a picket line.

President Biden, in other words, made a real and sincere effort to roll back neoliberalism, and would have done a lot more had Republicans not seized the House two years ago.

He is the true anti-establishment guy, taking an axe to Reagan’s, Bush’s, Clinton’s, Bush’s, and Obama’s embrace of the policies that have impoverished much of the American middle class.

The problem was that nobody knew Biden had so explicitly repudiated neoliberalism and taken such extraordinary and successful steps forward that, even in the face of a massive interest rate increase by the Fed, we did not have a recession. Our economy is doing better than any president’s economy since John Kennedy.

If Biden had just stepped out of the White House every day to let the press know what he was doing — like Trump did for four years (but with lies and BS) — and Kamala Harris had explicitly confirmed that she, too, wanted to end neoliberalism, the exit polls tell us today she would have won in a sweep.

But Harris and her team assumed that the message of rescuing democracy from fascism — an abstraction that most American voters don’t even understand — and protecting the right to abortion would beat Trump.

And they ridiculed Trump’s push for tariffs — even though Biden has embraced them — as a “middle class sales tax” when most people living in the Rust Belt know exactly what tariffs are and how they work to bring factories back home. Hell, we studied them in fifth grade civics when I was in elementary school growing up in Michigan.

As a result, voters went to the polls and voted to rescind abortion bans while simultaneously filling in the circle for Trump, thinking he’d bring back the prosperity that neoliberal economic policies stole from them.

As Damon Linker noted at his Notes from the Middleground Substack (reprinted in today’s New York Times), commenting on how Harris’ embrace of Liz Cheney was a dud:

“Reaganism is now well and truly dead, with no substantial base in either party.”

Similarly, Financial Times US National Editor Ed Luce wrote this morning after quoting Bernie Sanders’ comment that Democrats had lost the working class and citing Trump’s most successful ad that says “Kamala is for they/them, President Trump is for you”:

“Tuesday night strongly reaffirmed that Democrats are no longer the party of the working class. … It would be a big error for Democrats to write off America’s working classes as hidebound know-nothings. Nor should they dismiss the tens of millions of lower income households that voted for Trump as economically illiterate.”

This decisive vote for Trump tells us this is truly one of those “hinge points” of history that I’ve written about over the years.

And the double irony today is that the billionaires who support Trump want more neoliberalism; they want the tax cuts, deregulation, and to keep the unions out of their companies while retaining their offshore manufacturing facilities. But nobody ever told the American public in a way they could hear that that’s what most of Trump‘s billionaire supporters are all about.

Instead, Trump ran on faux populism, saying he’d use tariffs to bring jobs home while cutting taxes on tips and Social Security. To paraphrase James Carville, Trump’s pitch was, “It’s the economy, stupid.”

This is why two days ago Bernie came right out and said it:

“It should come as no great surprise that a Democratic Party which has abandoned working class people would find that the working class has abandoned them. While the Democratic leadership defends the status quo, the American people are angry and want change. And they’re right.”

DNC Chair Jaime Harrison (also a regular guest on my program) reacted with outrage, tweeting on Xitter:

“This is straight up BS… Biden was the most-pro worker President of my life time- saved Union pensions, created millions of good paying jobs and even marched in a picket line and some of MVP’s plans would have fundamentally transformed the quality of life and closed the racial wealth gap for working people across this country. From the child tax credits, to 25k for a down payment for a house to Medicare covering the cost of senior health care in their homes. There are a lot of post election takes and this one ain’t a good one.”

Sadly, Harrison’s message that Biden repudiated neoliberalism isn’t shared by all Democrats, and was barely even mentioned by the Harris campaign. Even significant numbers of Black and Hispanic men were willing to embrace a demagogue who openly hates them in the hope of getting good manufacturing employment that beats inflation.

It’s not enough to just do a good job at governing; you must make sure everybody knows about it. Deep down in their bones. Every day. Month after month, year after year. In that, Biden, Harris, and Harrison all failed, while Trump performed like an Olympic athlete.

If Democrats want a chance to return to power in America, they must — like President Joe Biden largely did — completely repudiate neoliberalism and openly re-embrace FDR’s system, promising to bring our jobs back home, limit illegal immigration, reestablish union power, and raise taxes on the rich.

And make damn sure everybody in America knows it!

Only then can Democrats regain enough of a base across working class America to credibly campaign on more “esoteric” issues like protecting democracy, tackling climate change, expanding healthcare and education, boosting housing support, and embracing equal opportunity for all.

Democrats must recognize how the winds have changed in America, do the work, spread the word, and let America know what they stand for. If they do, it could be a new day for this country.

The song that was inspired by this article is here.
My reading this article as an audio podcast is here.
My newest book, The Hidden History of the American Dream, is now available.