JONATHAN CHAIT AUGUST 5, 2011
Adam Serwer and Kevin Drum write today about the paradox of republicans forcing contractionary fiscal policy, and then reaping the political benefit of the resulting contraction. This is, indeed, a maddeningly unjust outcome. But it also suggests one strange corollary: The only way to get a really big new stimulus would be to elect a mainstream Republican president (Say, Mitt Romney or Tim Pawlenty) in 2012.
Here are my premises. Most Republican embrace of contractionary fiscal policy reflects conscious or unconscious partisanship rather than a sudden conversion to Austrian economics. You do have some genuine crazies in the House, but Republicans like Mitch McConnell are mainly driven by a desire to win power and please business. So, if the 2012 elections flip the House to the Democrats and put a Republican in the White House, that president will quickly grasp the policy and political imperative of stimulating the economy. The Democratic House would support it for policy reasons, and the GOP senate would support it for political reasons.
Now, personally, I'm not willing to accept the long-term policy changes that a Republican presidency would entail in order to get the short-term benefits of higher stimulus. But it is worth considering. The clear implication of the partisanship explanation of Republican behavior is that we need to flip the Republican Party's political incentive structure vis a vis stimulus.