Rubinomics & The Democrats

Robert Kuttner in this month's American Prospect has a look into Robert Rubin's powerful influence over the Democratic Party, which still hold true today, in light of shifting attitudes on economics.

An interesting snippet:

And although he no longer raises large sums for political candidates himself, Rubin remains very close to others in the Wall Street Democratic money machine, and to its party conduits, particularly Senator Chuck Schumer, who heads the Democratic Senate Campaign Committee, and Representative Rahm Emanuel, Schumer's House counterpart in the 2006 campaign.

When the Democrats took back the House in 2006, incoming Speaker Nancy Pelosi advised the new Democratic caucus that its first two briefings would include one on defense, with three experts of differing views. On the economy, Robert Rubin would be appearing, solo.

It will be interesting to see how influential Rubin wil be on the Presidential candidates. To date Edwards's appears to be the only serious candidate who is advocating for an economic world view notably different from Rubin's. Clinton, unsurpisingly, is running the most conservative campaign on economic issues.

Rubin's position as the Democrats' economic seer is unfortunate in several related respects. First, the vision Rubin is selling offers nothing for an economically stressed electorate. His theory is that budget balance, free capital markets, and low interest rates are both necessary and mostly sufficient for broad prosperity. We might like new social spending, but alas, the fiscal imperatives tie our hands. Rubin was a big supporter of pay-as-you-go-budget rules, now adopted by the Democratic congressional majority. These rules limit further Republican tax cutting, but they also hobble Democrats' ability to spend more than token sums on new initiatives.