The Wrong Political Game

Heading into a likely series of midterm-election defeats, Democratic incumbents would do well to remember two points -- large losses were likely inevitable, and insofar as they were avoidable, the party has only itself to blame for not handling the economy better.

Conventional wisdom is likely to disagree with both claims. Jonathan Martin wrote in Politico Monday that Democratic leaders' growing criticisms of the flood of anonymous money into the midterm elections is morphing away from being a campaign gambit into "a main talking point to explain -- and fend off the recriminations over -- what many Washington Democrats assume will be a brutal election night." On the right, of course, Democratic losses will be spun as demonstrating that true Americans march to the tune of the Tea Party drum. Among the establishment, the results will be spun as showing what all election results are said to show -- that Democrats are too far left and need to move to the middle.

The truth is simpler. The president's party usually loses seats in a midterm. Large congressional majorities are very vulnerable because the other guy is left with only his safest seats. Most of all, a bad economy is bad for incumbents. Specifically, as a nice set of charts from political scientist Seth Masket demonstrates, there's a significant correlation between growth in real disposable income and fewer losses for the president's party in Congress.

Unfortunately, pointing to the economy's role in determining presidential popularity often reads as an excuse. But it's not.

There's plenty of irrationality in voter behavior, including in voters' assessment of the economy. But the basic idea of holding elected officials accountable for short-term economic performance is in line with the reality that elected officials can, in fact, exert a lot of influence over the economy in the short term.

Over the long term, of course, it makes no sense to blame any particular Congress. The prosperity of a country, measured over a period of decades, has to do with the talent of its entrepreneurs in dreaming up new ideas and the diligence of the broader population in going to work. Policy matters to long-term growth, but mostly in ways that aren't very well understood, and it is only one of many factors. The short term is different. When unemployment is high, offices and storefronts are vacant, and factories are running below capacity, it doesn't take any bright new entrepreneurial ideas to increase production. You just need to do a better job of mobilizing the resources that exist. Get the people who aren't working into jobs, and they'll fill up the offices and crank up the factories.

Democrats, simply put, haven't gotten it done.

Speaking to The New York Times' Peter Baker for a profile published last week, Obama said his administration "probably spent much more time trying to get the policy right than trying to get the politics right" and drew the lesson that "you can't be neglectful of marketing and P.R. and public opinion."

Marketing and public relations are nice, but opinion is fundamentally driven by results. And on this, Obama has it backward. A party whose leaders realized that economic results were the most important driver of public opinion wouldn't have renominated a conservative Republican to head the Federal Reserve. Even more astoundingly, having given Ben Bernanke a second term in office, the Obama administration didn't get around to nominating anyone to fill the other vacant posts on the Federal Reserve Board until April 2010. Then, once the nominations were made, Senate Democrats didn't speed the hearings and confirmation process along. One of Obama's nominees, Peter Diamond, actually managed to win a Nobel Prize in economics while still languishing in confirmation limbo.

Similarly, the extent of stimulus possible in the American Recovery and Reinvestment Act was famously limited by the need to gain Republican support. Given that, shouldn't someone have put reconciliation instructions into the budget resolution that would have allowed for additional stimulus to be undertaken by majority vote? Instead, Senate Democrats wound up spending much of 2010 in painstaking negotiations with a handful of New England Republicans, desperately trying to eke out a few more dollars.

The issue is not so much that the administration needed to be more or less moderate, rather that it needed to be more effective in boosting the economy and more mindful of the central role it plays in politics. This matters because, to point out the obvious, the economic outlook is still bleak. Enhanced post-election focus on marketing and PR won't turn that around. In other words, all the marketing and PR in the world won't succeed in moving public opinion, meaning Democrats could easily have another round of election losses to look forward to.

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