Sunday, February 28, 2010

The Tensions of Obama-ism, Pt. II

Can he get worthwhile legislative victories and govern as a uniter? Edward Luce of the Financial Times says no (registration required, link via Brad DeLong):

Forget bipartisanship Obama: shoot for the moon: The problem started even before he was inaugurated. Mr Obama was faced with two conflicting objectives. First, try to revive a rapidly sinking economy by crafting a big fiscal stimulus – one that should be “timely, targeted and temporary” in the words of Lawrence Summers, Mr Obama’s chief economic adviser. Second, try to win over as many Republican votes as possible. In the event, Mr Obama got the worst of both worlds – a poorly designed stimulus that won only three (out of 41) Republican votes in the Senate. The price of those three was high. In order to appeal to the Republicans, a third of the “stimulus” was frittered away in minute tax cuts that most families either saved or used to help reduce their household debts. Designed to stimulate the economy and Republican support, the tax cut achieved neither. Second, its overall size was cut from $1,200bn to about $800bn – considerably lower than most economists believed was necessary to kick-start the economy. In order to win over Susan Collins, a Republican senator from Maine, the Democrats removed $83bn of short-term spending from the bill at the cost of 400,000 jobs....

A year later, little has changed. This week pundits got excited about a $15bn jobs promotion bill that was enacted in the Senate. The excitement was confined to political observers, who noted that the bill passed with the support of 13 opposition votes, including that of Scott Brown, the Republican who took the late Ted Kennedy’s Senate seat in last month’s Massachusetts election. It was celebrated as a victory for bipartisanship. What it did not herald was much of a victory for jobs. Economists confined their observations to the fact that the bill, which offers employers a one-year holiday on the 6.2 per cent payroll tax they pay if they hire someone who has been out of work for more than two months, was unlikely to make a notable dent in unemployment. Businesses are suffering from a lack of demand not supply....

Finally, Mr Obama’s bipartisan instincts arguably contributed to the parlous state of healthcare reform today. The most serious blow to the bill came last summer when Mr Obama allowed a small group of centrist Democratic and Republican senators to negotiate on a compromise. The exercise robbed Mr Obama of three valuable months and ceded the initiative to people who had no prior record of fighting for healthcare reform. It also created the space for the demagogic “townhall” meetings in which the bill was depicted as a Trojan horse for socialism, euthanasia and an all-seeing federal bureaucracy. The net result? No Republican votes....

American presidents with the greatest record of bipartisan legislative achievement, notably Franklin Roosevelt, Lyndon Johnson and Ronald Reagan, got their way by intimidating opponents, not by splitting the difference. As Machiavelli famously observed, it is better for a prince to be feared than loved. For all his intelligence, nobody fears Mr Obama...

One popular theory right now is that as long as the Republicans remain in la-la land, the president may have to choose between sound policy and political comity. But right now he's trying for the latter, and in so doing he's sacrificing the former and getting neither. (Actually, to be fair, I'm not sure I'd go so far as to say he's not getting any sound policy changes - health care, if it passes, will be huge, and the stimulus, for all its flaws, was necessary and successful, even in its watered-down form).

My gripe: I think the choice between good politics and good policy is a false one. Matt Yglesias argued a while back that a larger stimulus would have boosted the economy much more than the one we got, which in turn would have done a lot more to reassure nervous Democrats than limiting its price tag (and, correspondingly, its effectiveness) did. I agree with this analysis. The public wants political reconciliation, but it also wants policies that work. If Obama can get the policy right, than he's solved more than half of his problem - the rest is just a messaging battle, trying to convince people that the Republicans a) have no serious policy ideas and b) have consistently refused to negotiate in good faith. I think that's a political fight Democrats can win, but if they can't marry their political argument with tangible policy victories, they'll be in hot water come November.

2 comments:

Anonymous said...

Finally, some serious political commentary I can respect. Keep up the good work.

N. said...

Thanks!