Peter Beinart argues that the current debate about the Democrats’ stimulus plan is irrelevant from a political standpoint. All that matters, Beinart contends, is whether the economy improves during the next four years.
If it does (as seems likely to me), the Democrats will get the credit and will be beautifully positioned for the 2012 election, just as the Republicans were beautifully positioned in 1984 after the economy recovered following the enactment of Ronald Reagan’s economic program. If the economy manages not to improve by 2012, the Democrats will take the fall.
Moreover, because these scenarios will hold whether or not Republicans sign on to the stimular package, the Republicans are irrelevant bystanders.
Beinart is correct, I thnk, that everything turns on when the economy rebounds, and we have made the same point on the blog on our our PJTV show (John, I think, does not entirely agree). Americans are so eager to see the economy rebound that if it were to do so following a government policy of human sacrfice, the Democrats might well get credit for “turning things around.”
However, there are a few scenarios that, while not undercutting Beinart’s thesis, are worth considering. First, if the economy doesn’t recover until after the congressional elections in 2010, the Democrats could pay a steep price that year. In this scenario, the second half of Obama’s first term might well be rocky. Moreover, even if 2012 is a good year for Democrats, it will be difficult for them to pick up Senate seats because they will be defending so many of them (recall how well the Dems did in 2006).
The Reagan experience may be somewhat instructive. In the 1982 congressional elections, the Republicans paid a price for bad economic times, losing almost 30 House seats (though managing not to lose ground in the Senate).
Second, we could see a recovery within the next year or two followed by serious inflation, and perhaps another slowdown, before November 2012. In this scenario, the Dems could have another big year in 2010, but pay a huge price in 2012.
But Beinart’s point is valid. It’s the Democrats’ game right now, and the only Republican votes that currently matter politically are those of the ladies from Maine and Arlen Specter. Republican opposition to the stimulus plan is not without therapeutic value, and it is the proper and principled approach for us to take. But it will make very little difference when it comes to regaining political power in the next four years.
And, I would add, the Democrats probably have the better political hand because they are betting that the economy, one way or another, will recover. The American economy is usually a good bet, as much as the Democrats are doing (and will do) to impair it.
JOHN adds: I don’t deny the axiom that a good economy helps the party in power, and certainly if our economy rises like Lazarus over the next year or two the Democrats will benefit whether they had anything to do with it or not. I’m a bit more optimistic politically than Paul–which, sadly, may mean I’m more pessimistic economically–because it seems obvious to me that the Dems’ bill will have bad consequences. Not only that, bad consequences for which the Dems will be blamed.
First, budget deficits will explode to unheard-of levels. Second, taxes will be increased. Third, inflation will strike. Fourth, stories will leak out in local media across the country about how “stimulus” funds are being used, i.e., wasted. I just don’t see a scenario where the economy improves and people therefore fail to realize what a horrible bill this was–especially because so many Americans are deeply suspicious of the bill going in.
To comment on this post, go here.