Reckless Predictions




You had no reason to notice it, but The American Prospect was totally Y2K-free this past year. We didn't run a single article about the disasters that were supposedly going to befall the world after the clock struck midnight on New Year's Eve. We also didn't run any articles giddily anticipating all the wonders that human ingenuity would bring in the twenty-first century. We are a sober lot. We don't make reckless predictions one way or the other. Now I propose to spoil that spotless reputation by speculating about the outcome of the 2000 presidential election.



First speculation: Although Bill Bradley refused to acknowledge it, Al Gore effectively ended the race for the Democratic presidential nomination in New Hampshire. Gore might not have won there if John McCain hadn't corralled the majority of the independents. But immediately afterward, Gore soared to a huge advantage in national polls (40 points, as I write a week later), and there seems little way Bradley can regain traction. The nomination should be settled in March, leaving the Democrats plenty of time to heal their wounds and reunite for the general election. Bradley's donors can console themselves with the thought that they helped get Gore in shape.



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Second speculation: The Republican race will also end with the triumph of the anticipated victor, George W. Bush, though the fight promises to go on longer and significantly diminish Bush's stature. McCain has already shown in New Hampshire--and may do so again in South Carolina and Michigan--that a candidate who comes across as more mature and experienced can trounce the boy from Texas. Perhaps the popular groundswell will carry McCain to the nomination, but the odds are against it: Republican primary voters lean heavily to the right. (The early primaries exaggerate McCain's strength because their rules allow crossover voting by independents and, in the case of South Carolina and Michigan, by Democrats as well.) Bush's support among the Republican leadership will give him a critical edge in amassing delegates, but a victory that depends on mobilizing the party's base could have a huge cost. Before the primaries got under way, Bush was moving toward the center; fighting for survival, he has turned right. The longer the battle with McCain persists, the more Bush is likely to alienate moderates and independents he needs in November. Also, beating up a war hero isn't pretty. One potentially disastrous scenario for the Republicans is that McCain wins the popular vote in the California primary, but Bush gets all the delegates because only the votes of registered Republicans count in the delegate contest. Bush could emerge the nominee, but with his legitimacy in tatters. Even if he wins the nomination with a clear majority, the polls in the spring and early summer will show him locked in a close battle with Gore or will put Gore ahead.



Third speculation: As the general election shapes up, Bush will still hold a big lead in fundraising and will use that edge to do as much damage to Gore as possible. The fall campaign will be ugly. Remember, Dad's advisers brought us Willie Horton, and the younger Bush is already proving in his attacks on McCain that he's no slouch. This time it's hard to see how the Republicans could play the race and crime cards against the Democratic candidate. Two strategic options seem more likely: First, a generalized attack on Gore for "corruption," playing off the Clinton-era scandals. And second, an attack on Gore as the prisoner of "special interests"--particularly gays, where Gore has already given the Republicans an opening because of his subsequently retracted remark that support for gays in the military would be a precondition for appointments to the Joint Chiefs of Staff. But will implicit antigay appeals work as well as implicit racial appeals have worked in the past? I don't think so. Moreover, the Clinton scandals are getting stale, and the grounds for defining Gore as corrupt are weak.



Fourth speculation: Barring any "October surprises," Gore will win the presidential election. And since I'm living dangerously, I'll go a bit further: It won't even be close, and the Democrats will regain the House.







A Primary Discolored



California's rules for presidential primaries are a disaster waiting to happen. If it is not the Republicans this year, some party in the future is going to face a grim picture: One candidate wins the popular vote in California, while another candidate backed by a majority of registered party members gets all of the state's delegates (it's winner take all) and thereby captures the nomination in a victory that the public sees as illegitimate.



Primaries are supposed to strengthen the legitimacy of a nominee by demonstrating support by the members of a party. Open primaries take the idea an ill-advised step further, allowing nonmembers to determine a party's nominee. California's compromise (an open expression of preferences, a closed vote on delegates) is the worst of all possible worlds since it potentially discredits a nominee at the very time of an election. It undermines the integrity of a party's nominating process. If California won't repeal the system, it ought to face a constitutional challenge.







The Manic Budgetary Process





Now consider some genuinely reckless speculation: the official federal budget forecasts. Thanks to the rules for long-term budget forecasting, America suffers from what might be called manic fiscal psychosis: a rapid oscillation of moods in federal budgetary policy. A few years ago, the Congressional Budget Office (CBO) and Office of Management and Budget (OMB) projected immense budget deficits "as far as the eye could see"-- actually, further than either of them, or anyone else, could see. Now the same agencies project immense budget surpluses extending indefinitely into the future, with CBO's projections running far higher than OMB's.



Of course, the economy has improved, and tax and spending policies have changed. But one reason for the bipolar fiscal mood swing is that the forecasts are driven by current trends in revenues, expenditures, and the economy. Even slight variations in those trends, when projected out just a few years, much less a decade, produce huge swings in the budget balance. The balance, after all, is the difference between two huge unknowns--future revenues and future expenditures, each in the trillions of dollars. The farther each of these unknowns is projected, the more uncertainty increases, and it becomes staggeringly large for estimating the net difference between them.



The purpose of long-term forecasts is to make government decisions more rational, but the political effects can be perverse. Projected deficits plunge us into unjustified gloom; surpluses get us intoxicated. Professionals familiar with the numbers understand that they need to be taken with some caution, but that kind of critical understanding seems impossible in the national political arena. The whole debate about Social Security has been colored by what may well turn out to be unnecessarily pessimistic economic assumptions; yet if we had listened to the sirens of doom, we might have made long-term structural changes to the program that would have sacrificed many of its benefits in reducing poverty among the elderly.



What could we do to avoid making long-term policy on the basis of transitory fiscal illusions? The statistical agencies should give wider ranges among their long-term forecasts to emphasize how uncertain the forecasts are. And the most conspicuously reported fiscal results should be stated as percentages of gross domestic product, not as absolute numbers (which seem incomprehensibly large). It would also be healthy for the agencies to report on their own previous records: How accurate have their assumptions and estimates proved to be? That ought to introduce some skepticism into the debate. ¤





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