Why Clinton and Obama Aren't As Similar As You Think

People tend to perceive the Democrats as unified and the Republicans as trapped in internecine brawling, but in his column today, David Brooks argues that ideological fissures within the Democratic party are bound to erupt if Hillary Clinton or Barack Obama is the next president. The idea is that the new Democratic president will either withdraw from Iraq, or not, and will either make good on ambitious domestic proposals, or not. Either way, Barack or Hillary will inevitably split the party's liberals and moderates apart.

Well, maybe. Forecasting this far in advance is not a terribly productive exercise. Nobody has any idea what Iraq will be like in a year, and no one is certain what the domestic political and fiscal circumstances in a year's time will portend for the next administration.

Reading Brooks's first paragraph, I was hoping he would push back against the deeply-ingrained conventional wisdom that there are no significant policy differences between the Democratic candidates. Instead, he takes it for granted. Here is why it's wrong.

The myth of ideological unity in the Democratic presidential race comes primarily from two sources. First, the candidates themselves have insisted at nearly every turn that there is very little daylight between them on ideological grounds. But they have a clear incentive to play down any differences between them, namely, the fact that both candidates' platforms are wildly popular among a wide cross-section of Democrats.

Secondly, there is the seemingly objective fact that Obama and Clinton share virtually all the same policy goals. This overlap proves a lot less than most observers assume. In some sense, after all, both the nuclear freeze movement and Ronald Reagan sought to abolish nuclear weaponry. But their very different approaches to meeting that goal encompassed a wide ideological gulf.

The case of Clinton and Obama is subtler, but similar. Both believe that social inequality, poverty, and inadequate health care are problems the government should take a robust, active role in solving. And that's about as far as it goes. Clinton and Obama's domestic proposals differ extensively in detail because Clinton and Obama have starkly different visions of how government action on any social ill should be organized.

Unify this: Obama's infamous "snub" Take the subprime mortgage crisis, for example. Clinton and Obama agree that the government should do something to help people facing foreclosure or bankruptcy. Now, there are essentially two ways to make mortgage payments more affordable: by tinkering with the interest rate on the mortgage, or by tinkering with the principal balance (i.e. the value) of the mortgage.

Clinton favors the first approach, trumpeting a five-year freeze on existing mortgage interest rates as a cornerstone of her economic package. It's difficult to overstate just how heavy-handed that sort of interventionism is. It is not possible to play games with a subset of interest rates without the consequences spreading throughout the market. An interest rate freeze would drive investment out of the housing market and -- I can explain how this process works if anybody's curious -- cause new mortgage interest rates to skyrocket. In other words, people will feel the hand of the government in Clinton's plan, and it's doubtful that they'll like the feeling.

Obama, on the other hand, focuses on principal balances. He wants to remove existing statutory restrictions on reassessing the value of a mortgage and provide borrowers with subsidies. His plan offers similar relief to the Clinton plan. But since Obama doesn't inflict pain on new prospective borrowers or investors, it leaves barely a footprint.

This is just one example among many. On issue after issue, Clinton favors very traditional welfare-state liberalism, with all its attendant deficiencies and political liabilities. In the case of the mortgage crisis, Clinton is literally advocating a return to 70s-style price controls.

Obama, by contrast, is proposing something very different and new. His lead economic advisor, Austan Goolsbee, calls it "iPod government: simple to use, easy for people, makes their life better.''

Clinton and Obama broadly agree on policy goals and activist government, placing them somewhere near each other on the center left. But Clinton is a statist, while Obama is an individualist. Their philosophies of government are very different.