“It’s More Than Romney Promised”: What Would Republicans Say If Mitt Romney Were President And The Economy Was This Strong?
Imagine if Mitt Romney were president right now.
Imagine if, 722 days after winning the election, President Romney were presiding over an economy growing at five percent a year, an unemployment rate dipping beneath six percent, and gasoline that was less than $2-a-gallon.
This is, after all, what Romney promised. Hell, it’s more than Romney promised.
“I can tell you that over a period of four years, by virtue of the policies that we’d put in place, we’d get the unemployment rate down to six percent, and perhaps a little lower,” he told Time during the campaign. December’s tumble to 5.6 percent unemployment is, thus, two years ahead of schedule.
As for the five percent growth rate and the sub-$2 gas — that’s more than Romney dared ask the electorate to expect. Tim Pawlenty — remember him? — promised to nudge growth to five percent and was roundly mocked for his troubles. And to find anyone promising $2-a-gallon gas, you need to dig up Michelle Bachmann’s campaign lit (even Newt Gingrich didn’t dare predict gas under $2.50, and he wanted to use space mirrors to light highways).
If Mitt Romney were president right now, he would be seen as the second coming of Ronald Reagan. There would be parades in the streets. The kids would have “severely conservative” tattoos. Men would be saying “gosh.”
This is the problem with how Washington — Democrats and Republicans alike — interpret economic news. If Mitt Romney was president right now the economic numbers would be seen as proof that he was a remarkable success. They would appear to show that his agenda — repealing Obamacare, cutting taxes, deregulating the economy, greenlighting the Keystone XL pipeline — was precisely what had been needed to unleash the awesome growth engine that is the American economy. Conservatism would be ascendant. Liberalism would be discredited.
But Barack Obama won the election. The Affordable Care Act hasn’t been repealed. Taxes were raised in 2013. Regulation has proceeded apace. The Keystone XL pipeline is no closer to being built. And yet the economy is roaring. The ambitious economic promises the GOP field made for their conservative policies have been achieved despite the continuation of liberal policies.
There is an easy liberal interpretation here: President Barack Obama is great. Liberalism is great. And it’s simply entrenched media narratives and the GOP’s relentless resistance to giving Obama credit for anything that has left his approval rating stuck at 44 percent.
But I come not to praise President Obama. I come to bury the lazy economic thinking that infects American politics and, particularly, political campaigns.
Washington tends to think of itself as the cause and everything that subsequently happens in the world as the result. A booming economy is proof that Bill Clinton is a genius, or that Ronald Reagan is a genius. A crappy economy is proof that Barack Obama is a naif, or that George H. W. Bush can’t govern. It’s a view of causality usually found in five-year-olds, but it is pervasive in American politics. It is also false.
Policy matters, of course. And, particularly in 2008, 2009, and 2010, it was, arguably, the driver of our economic fortunes. But, for the most part, the economy is driven by much beyond what happens in the White House and the Congress (caveat: the Federal Reserve is an immensely powerful actor, but come campaign time, politicians tend to pretend it doesn’t exist).
It’ll be some time yet before we know whether the economy is truly beginning to roar or the engine is about to sputter out. But the $2 gas that’s left economists so optimistic isn’t the fault of anyone in Washington; it’s a mixture of technological innovation leading to more supply, falling global demand leading to yet lower prices for that supply, and Saudi Arabia refusing to slow production because it wants to choke America’s nascent shale-gas industry (Brad Plumer has an excellent look at the causes behind the cheap gas here).
The reasons unemployment has fallen below six percent are varied, and some of them are problematic (like the reduction in labor-force participation). Government policy has played a role, and my read of the evidence is that premature austerity, particularly at the state and local government level, did a lot to slow the recovery. Nevertheless, anyone suggesting that the job gains over the last two years are the clear result of anything Congress did, or didn’t do, is fooling themselves.
It’s an unhappy fact of political life that the direction of the economy tends to decide elections even though it isn’t actually driven by political decisions. Politicians tend to get around that by pretending otherwise: they take more credit than they deserve when the labor market is doing well, and they receive more blame than they deserve when it’s flagging.
By the normal rules of politics — the rules we would be playing under if Mitt Romney had won the election — the recent economic news proves Barack Obama is a magnificent leader and liberal policies an economic boon. But the normal rules of politics, at least when it comes to interpreting the economy, are dumb.
By: Ezra Klein, Vox, January 12, 2015
“GOP Lawmakers Hit The Ground Running To The Far-Right”: House Republican Leaders Still Haven’t Mastered The Art Of Vote-Counting
In the weeks immediately following the 2014 midterm elections, there was an enormous amount of talk about the need to avoid “poisoning the well.” The point seemed to be, policymakers should be cautious about picking political fights in order to avoid partisan rancor in the new Congress.
Clearly, those concerns have been thrown out a Capitol Hill window.
House Democrats on Wednesday knocked down a GOP bill that would have delayed a key Wall Street reform known as the Volcker Rule, stunning Republican leaders who had expected it to pass with ease. […]
The bill would have allowed banks to hang onto billions of dollars in risky collateralized loan obligations for two additional years by amending the Volcker Rule, which is part of the 2010 Dodd-Frank financial reform law. The rule bans banks from speculating in securities markets with taxpayer funds, requiring them to dump their CLO holdings. A Volcker Rule delay would be a major boon to the nation’s largest banks.
Note, a majority of the House voted for the measure, but because Republican leaders brought the bill up under the suspension calendar, it needed a two-thirds majority to pass. It fell far short.There are a few ways to look at yesterday’s failure. The first, of course, is that House Republican leaders still haven’t mastered the art of vote-counting. The second is that GOP lawmakers clearly remain committed to using their power to do Wall Street’s bidding.
But even putting that aside, let’s not miss the forest for the trees: on only the second day of the new Congress, House Republicans immediately turned their attention to a controversial proposal, backed by financial-industry lobbyists. These guys really aren’t wasting any time.
Indeed, it’s amazing to see just how aggressive the new Republican majority has been since taking its oath of office on Tuesday.
Barring crisis conditions, the start of a new Congress can generally be compared to the start of new school year: folks like to get settled in before tackling a lot of work. On Capitol Hill, some members, especially the freshmen, are still unpacking and learning their way around.
And it’s against this backdrop that House Republicans this week are voting to undermine the Volcker Rule, undermine Social Security, undermine the Affordable Care Act, approve the Keystone pipeline, and impose irresponsible “dynamic scoring” rules – all in the first three days.
It’s one thing when lawmakers furiously try to get stuff done before the end of a Congress – they tend to move quickly when facing an inflexible deadline – but the House GOP majority seems desperate to get this new Congress off to a fast, far-right start, just for the sake of doing so.
What’s more, we’re not even going to touch the newly introduced legislation – including major new abortion restrictions proposed yesterday – which will be considered in the weeks and months to come. I’m just talking about measures on the House floor this opening week.
E.J. Dionne Jr. reminded us this morning, “This will be no ordinary Congress.” Republicans are eager to prove this prediction true.
By: Steve Benen, The Madow Blog, January 9, 2014
“Time For The Laugh Track!”: Republicans Have A Veto-Proof Math Problem
Behold Washington’s new math.
The first anti-Obamacare bill of the new Congress, the Save American Workers Act of 2015, was written to undo the part of the law that defines “full employment” as holding a job for as little as 30 hours per week. It passed, and on the way, it became even more partisan in color than the 2014 version of the bill. In the last Congress, 18 Democrats voted with every Republican to pass the bill, but Thursday only 12 did, including all but one of the 2014 supporters (not Georgia Rep. Sanford Bishop) and two new Blue Dogs (Florida Rep. Gwen Graham, Nebraska Rep. Brad Ashford).
By turning on the bill, the Democrats made clear that they would sustain the veto already promised by President Obama, and, yes, they have the votes to do so. If every member of the 114th House of Representatives shows up for a vote, 48 Democrats need to join every Republican to override a veto. Three times this week, when the GOP brought forward bills to approve the Keystone pipeline and delay part of the Volcker Rule, the Democrats denied them all but a handful of votes.
Just as interesting as the Republican math problem were the arguments Democrats used to hold back their votes. In its veto message, the White House said the 30-hour work week bill “would significantly increase the deficit” and cited 2014 numbers from the Congressional Budget Office to say it would “increase the budget deficit by $45.7 billion over the 2015 to 2024 period.” In the Senate yesterday, in a conversation with reporters, Illinois Senator Dick Durbin repeatedly mocked Republicans for offering changes to the ACA without offering up the mechanisms to pay for them.
“I’m just not going to buy the premise Republicans now want to sell, that deficits don’t count,” Durbin said. “Since they’re in the majority, they’re going to use dynamic scoring—time for the laugh track!—they’re going to use dynamic scoring to prove that they can cut any tax without an impact on the deficit. That doesn’t work. That’s why we’ve stopped short of repealing the medical device tax, because the payfor has never been explained.”
Of course, the Democrats had a terrible election—no news there—and in the process they watched Republicans leap ahead of them in voter trust on key issues. Republicans pulled into a tie on health care, which had always been a Democratic advantage, and they built huge leads on taxes, the economy, and the deficit. Yet in the months after the election, they watched President Obama’s approval rating tick up, and saw a dynamite series of jobs reports followed by 5 percent GDP growth in the final quarter.
Democrats paid attention to new Majority Leader Mitch McConnell’s maiden speech, and how “the [economic] uptick appears to coincide with the biggest political change of the Obama administration’s long tenure in Washington: the expectation of a new Republican Congress.” To counter that claim, Democrats in Congress want to reframe the GOP’s bills as deficit-busters, and make sure Republicans get none of Barack Obama’s credit if the economy continues to improve.
By: Dave Weigel, Bloomberg Politics, January 9, 2015
“Tiresome Assertions”: More Revisionist History About Clinton And Obama
I briefly mentioned Michael Gerson’s “Are Democrats Stuck in 1979?” column yesterday, but wasn’t in a big hurry to smack it down. It’s precisely Gerson’s history as the rare conservative willing on occasion to criticize his party’s extremism that probably makes this sort of claim that the other side is even more extreme inevitable.
But some editor or maybe even a history-conscious intern might have warned Gerson that choosing 1979 as the mythical apogee of Democratic liberalism was a bad idea. That’s a year in which a Democratic president began to prepare for a re-election campaign by pushing for a balanced budget and a big increase in defense spending, even as liberal icon Ted Kennedy headed for a humiliating defeat in the primaries.
In any event, here’s the tiresome assertion that really annoys me as a veteran of the New Democrat thing:
President Obama has now effectively undone everything that Clinton and the New Democrats did in the 1980s and ’90s.
Gerson’s not real specific about this claim, though I assume part of his argument would involve resuscitating the Romney-Ryan campaign’s lie that Obama had “gutted” welfare reform. But what else?
Since Gerson appears to assume that Clinton was strictly about appropriating conservative themes, I guess he cannot come to grips with the fact that the Affordable Care Act was based on the “managed competition” model that a lot of New Democrats preferred to Clinton’s own health care proposal, or that Obama’s “cap-and-trade” proposal was relentlessly and redundantly promoted by the New Democratic think tank the Progressive Policy Institute. Just about everything Obama has proposed on tax policy, education policy, infrastructure policy, trade policy and even national security policy has been right out of the Clintonian playbook. Has Gerson noticed that Obama’s not real popular with people on the left wing of the Democratic Party?
Well, never mind; I guess the Obama-the-lefty construct, threadbare as it is, was necessary for Gerson to set up the heads-we-win tails-you-lose proposition that HRC needs to move the Democratic Party to the right or accept that “the political achievements of her husband [have] been washed away.” I do believe Obama was the first Democrat since FDR to be elected twice with a majority of the popular vote; that ought to count for something.
By: Ed Kilgore, Contributing Writer, Political Animal Blog, January 7, 2014
“Austerity’s End Strengthens U.S. Recovery”: Speechless, Republicans Fall Back To Peddling More Nonsense
For a variety of partisan and ideological reasons, the right finds it necessary to believe austerity helps the economy. Conservatives, on Capitol Hill and off, remain wedded to the idea that taking capital out of the economy and weakening demand will lead to more growth, all evidence to the contrary notwithstanding.
In an amusing twist, as the U.S. economic recovery gains strength, some on the right actually feel vindicated.
Grover Norquist would like Republicans to shut up about how bad the economy is, and instead take credit for the recovery.
The prominent anti-tax crusader hasn’t turned into a bullhorn for President Barack Obama’s economic policies; he still thinks they’re a drag on jobs and wages. But he’s also grown critical of his fellow Republicans for making poor strategic and messaging decisions on several key issues. Rather than tying the economic recovery to spending cuts ushered in by the sequester and to the continuation of 85 percent of the Bush tax cuts, he said, some in the party have insisted their own leaders fumbled those items.
It’s an interesting course correction for the right. In recent years, Republicans have said the combination of the Affordable Care Act, federal regulations, and higher taxes on the wealthy are crushing the economy. That argument obviously doesn’t make any sense in light of the strongest growth and job creation in over a decade.
So Norquist is suggesting his party flip the script: sure the economy is starting to soar, he says, but that’s only because deep spending cuts like “the sequester” gave the nation a big boost. Austerity took capital out of the system, some conservatives are now arguing, and just look at how great the results are!
It’s important to understand the degree to which Norquist has the story backwards. Recent developments haven’t bolstered conservative economic theories; they’ve done the opposite.
First, the national economy hasn’t improved as a result of spending cuts, but rather, the end of spending cuts.
For a long stretch, government spending cutbacks at all levels were a substantial drag on economic growth. Now, finally, relief is in sight. For the first time since 2011, local, state and federal governments are providing a small but significant increase to prosperity. […]
Across the nation, state and local governments, Democratic and Republican alike, are spending on projects that were stalled. Teachers, who were laid off in droves in recent years, are being hired again. Even federal spending in some sectors is on the rise.
The more the public sector starts to reinvest, as opposed to scaling back, the stronger economic growth becomes. This is the polar opposite of Republican economic theory, and yet, the laws of supply and demand don’t much care about politicians’ ideology.
Second, as Danny Vinik explained, “one of the big reasons that the economy kicked into gear in the latter half of this year is that the Murray-Ryan budget deal alleviated much of sequestration. Fiscal policy, finally, is largely not standing in the way of stronger growth.”
Paul Krugman last week seemed to anticipate Norquist’s argument, and preemptively destroyed it.
Suppose that for some reason you decided to start hitting yourself in the head, repeatedly, with a baseball bat. You’d feel pretty bad. Correspondingly, you’d probably feel a lot better if and when you finally stopped. What would that improvement in your condition tell you?
It certainly wouldn’t imply that hitting yourself in the head was a good idea. It would, however, be an indication that the pain you were experiencing wasn’t a reflection of anything fundamentally wrong with your health. Your head wasn’t hurting because you were sick; it was hurting because you kept hitting it with that baseball bat.
And now you understand the basics of what has been happening to several major economies, including the United States, over the past few years. In fact, you understand these basics better than many politicians and commentators. […]
[I]n America we haven’t had an official, declared policy of fiscal austerity – but we’ve nonetheless had plenty of austerity in practice, thanks to the federal sequester and sharp cuts by state and local governments. The good news is that we, too, seem to have stopped tightening the screws: Public spending isn’t surging, but at least it has stopped falling. And the economy is doing much better as a result.
I can appreciate the dilemma facing Norquist and his allies when it comes to explaining the sudden economic surge. Indeed, after the strongest economic growth in 11 years, Republicans greeted the news with total silence – literally.
And if I were in their shoes, I’d probably be speechless, too. But that’s no excuse for peddling nonsense – those hoping to credit austerity for a healthy recovery clearly have no idea what they’re talking about.
By: Steve Benen, The Maddow Blog, January 2, 2014
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