Three years out, few bets in U.S. politics looked as sure as Hillary Clinton’s election to the presidency in 2016. Republicans had badly polluted their brand in the debt ceiling standoff. Their coalition seemed to have dwindled to an embittered band of older white Southern men.
But it’s never wise to predict the future by projecting forward from the present.
By spring 2014, the U.S. economy had been expanding for almost 60 months, the fifth-longest expansion in U.S. history, but also the weakest and most lop-sided. Through the expansion, poorer Americans failed to raise their consumption to pre-2007 levels, even as richer Americans bid stock prices to record highs.
Facing a bleak Christmas selling season, Wal-Mart began cutting orders to suppliers in the fall of 2013. The official retailer of Lower America cut its sales force by 10%. Target also reported strangely disappointing sales in 2013. Ultra-down-market retailer Dollar General reported better sales, but almost all of those results were driven by its decision to begin selling tobacco products in its stores.
All the oomph in the U.S. economy was delivered by the top 10% of households. And they were vulnerable to events in the financial market. When such an event struck in the early spring, the U.S. economy toppled back into recession. The tentative employment gains of the Obama years were abruptly wiped out, and congressional Democrats suddenly faced a very ugly scenario in the fall 2014 elections.
In a frantic effort to mobilize supporters, the Democrats abruptly veered toward more populist economics. Senator Elizabeth Warren began to demand not just fines on JP Morgan, but the actual breakup of too-big-to-fail financial institutions. Too little, too late: instead of the gains they’d been counting on in 2013, the Democrats lost 15 House seats and control of the Senate in November 2014.
That defeat galvanized something in progressive Democrats. In an effort to collect chits for 2016, Hillary Clinton had campaigned hard for fellow Democrats in 2014. Now Clinton was damaged— and the fundraising successes of her ally, Virginia Governor Terry McAuliffe, suddenly became a target of criticism rather than a source of gratitude. “I don’t think we can auction our party’s future to Terry McAuliffe’s rich friends,” Senator Warren told MSNBC’s Rachel Maddow three days after the election defeat.
In the painful aftermath of 2014, many Democrats were ready to hear that the party had been defeated because President Obama had been too cautious in his policies and too remote in his style. As Obamacare stumbled from implementation difficulty to implementation difficulty, they remembered that the program they really wanted was Medicare for all. They seethed at the way Obama had submitted to Republican demands that budget balancing take precedence over job creation. And whatever happened to the administration’s promises on climate change?
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