JONATHAN CHAIT AUGUST 30, 2011
The debate within the Democratic Party over President Obama's incipient economic relief program is being conducted between two sides that totally misunderstand its purpose. On the one side, you have administration centrists who support a sufficiently narrow plan that can pass Congress:
Mr. Obama’s senior adviser, David Plouffe, and his chief of staff, William M. Daley, want him to maintain a pragmatic strategy of appealing to independent voters by advocating ideas that can pass Congress, even if they may not have much economic impact. These include free trade agreements and improved patent protections for inventors.
And on the other side, you have liberals who demand boldness:
“Will he commit all his energy to offering bold solutions, or will he continue to work with the tea party?” AFL-CIO President Richard Trumka said at a recent breakfast hosted by the Christian Science Monitor, adding: “If he falls into nibbling around the edges, history will judge him and working people will judge him.”
Here's what everybody is missing: Nothing of significance can pass Congress. Maybe -- maaaybe -- an extended pressure campaign could force Republicans to agree to extend the payroll tax cut. But even that would have modest stimulative benefit. Anything larger has no chance of enactment. Republicans have strong ideological and partisan motives to block any further economic stimulus. Obama can try to design a strategy to exact a political toll for Republican obstruction, but he can't design a strategy to result in passing any significant new stimulus.
The moderates who think Obama can whittle his proposals down to the point where Congress will let them sail through simply haven't been paying attention to the GOP's strategic decision to deny Obama bipartisan cover. And the liberals who insist on a big plan seem to be in denial:
“Even though [Obama] knows Republicans will not allow it to pass Congress, this is a debate that will be settled only by the election, and he needs to go into the election telling the truth about what it will take to get out of this perpetual high-unemployment rut that we’re in now,” said Roger Hickey, co-director of the Campaign for America’s Future, a progressive strategy group.
Michael Ettlinger, vice president for economic policy at the liberal Center for American Progress, said the economy needs millions of new jobs — and the plan must meet that demand.
“The plan also needs to test the boundaries of what Congress is willing to do,” Ettlinger said. “The president should not start off trying to meet halfway people who only offer completely incoherent economic policy. The president should offer a plan that actually creates jobs, the jobs we need, and then take it to Congress and take it to the people. Offering a weak proposal and then complaining that Congress won’t take action isn’t the way to create jobs.”
It's true -- complaining about a weak proposal that didn't pass won't create jobs. At the same time, complaining about a strong proposal that didn't pass won't create jobs. Congress is not going to pass anything that will create jobs.
This does not mean there is nothing Obama can do. But his plan needs to be understood as a political strategy, not as a legislative strategy. The point of it is to propose something that is popular and which Obama can blame Republicans for blocking. There is no upside in blaming the opposition for blocking a bill that voters don't want to pass.
That means the plan does need to be somewhat big -- anything that's too small will transparently be seen as insufficient to the scale of the disaster. On the other hand, it needs to grapple with the reality that most Americans don't support the kinds of economic stimulus that economists think we need. Now, if Obama potentially had the votes in Congress to pass another stimulus, it would be worth taking an unpopular vote in order to rescue the economy. Since Obama does not and will not have those votes, he needs to conceive of his plan as a political message. There is no point in holding a message vote when the message is unpopular.
This seems to be a reality liberals have trouble acknowledging. There are a lot of issues where the public agrees with the left. Economic stimulus does not appear to be one of them. Now, public opinion is fairly hazy and ill-informed about this, and certain elements of economic stimulus can command majorities. But the passage of the first stimulus, at the height of Obama's popularity, shows pretty clearly that people instinctively think that, when the economy is terrible, having the government spend a lot of new money is not going to help. That they're wrong doesn't really matter for the purposes of this question.
The liberal dialogue about stimulus is almost a perfect parallel to the way conservatives talked about Social Security privatization in 2005. The idea was unpopular, and Democrats in the Senate were determined to block it. Conservatives, though, couldn't acknowledge this. They kept insisting that President Bush push harder, give more speeches, pressure Senate Democrats to give in. Conservatives kept saying this was vital -- we had to privatize Social Security or all would be lost, defeat was not an option.
This is not an argument for -- to use the popular epithet -- "fatalism." Obama has options. He can do his best to frame the debate so as to clarify that Republicans are blocking popular economic recovery measures, like the payroll tax cut and perhaps some infrastructure projects. Conceivably if he wins reelection, and the democrats make huge gains in the House, republicans will rethink their approach and open themselves up to some kind of compromise in 2013. In the meantime, I see no point in blinding oneself to reality.