Already, across the country, there's a growing rift between unions in the public sector and the private sector, perhaps not in official statements but clearly in terms of rank-and-file voters and popular perceptions. Wisconsin Gov. Scott Walker got 37 percent of the vote from union households in his recall fight, in part because private sector union members understood how much the private sector needed a healthy state economy.
More broadly, the old system of rewarding liberal elites on cultural and environmental issues while paying off the working class with economic spoils will be increasingly hard to sustain. Obama's positions on gay marriage and the Keystone XL pipeline fuel donations from celebrity millionaires, but they don't help with middle- and lower-class voters. And if those voters get no payoff from voting Democratic, what's the point?
Consider Obama's decision to grant work permits to perhaps 1 million young illegal immigrants. In a booming economy that would be a lot easier. Instead, the White House must tell millions of unemployed blacks that the competition for jobs has just gotten tougher because Obama needs more Latino votes.
Ironically, the last time America experienced the politics of austerity, it was a great boon for the Democratic Party. Franklin D. Roosevelt cobbled together his great coalition in the 1930s by doling out patronage and spoils to various constituencies.
But here's the difference. Roosevelt could target his pandering without too much fear of spillover. He could tell blacks he was on their side and Southern racists he was on theirs. In Oval Office meetings, he would mollify members of his coalition by blaming other members for holding up progress.
I don't actually think the Democratic Party is doomed (nor did I ever believe the GOP was). But the way politics is done has to change for the simple reason we cannot afford it. Maybe I'm wrong, but the Democrats seem far less prepared to deal with that reality than the Republicans.