PLANK OCTOBER 2, 2012
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Presidents who seek re-election in the midst of a sagging economy don’t usually win. The prime example is Herbert Hoover in 1932, but there is also Jimmy Carter in 1980 and George H. W. Bush in 1992. So, with the current economy still in the doldrums, Mitt Romney should be poised to deny re-election to Barack Obama. But instead he seems poised for defeat.
The most talked-about reason is that Romney is a singularly unattractive candidate: Whatever his political views, he acts like the typical country club Republican. But another reason is the way Romney and his Republican supporters have framed the debate over the economy. They have focused inordinately on two issues that don’t really get at most voters’ worries about the economy: the plight of small business and the increase in the national debt.
Small business: Romney focused six weeks of his campaign on the (spurious) charge that Obama had suggested that small business owners didn’t build their businesses. “We built it” was the theme of the second day of the Republicans convention. In his speeches, Romney rarely talks about workers; if he wants to describe economic hardship, or to tout his own promise of economic revival, he talks about small business.
At a speech last week in Westerville, Ohio, Romney made this perspective explicit.
Romney promised tax relief not to individual workers, but to small business owners. “I’m going to champion small business. Small business, where jobs come from. And let me tell you how to do that. ... We’ve got to reform our tax system,” Romney said. But he warned the audience not to “be expecting a huge cut in taxes, because I’m also going to lower deductions and exemptions. But by bringing rates down, we’ll be able to let small businesses keep more of their money, so they can hire more people.”
In their ads, the Republican super PACs have echoed Romney’s message. An ad by Karl Rove’s Crossroads USA consists entirely of small business owners criticizing the President. It opens with a women labeled “small business owner” declaring that “small businesses like ours are what have driven the country, and President Obama doesn’t understand that.”
This doesn’t seem to be an effective way to reach voters who are worried about the economy. Voters are worried about themselves and about their families. By appealing to small business owners, Romney and the Republicans are reaching a miniscule percentage of the total workforce and of the electorate. There are about six million employers in the United States--a group that includes small business owners. That means they make up at best about three percent of the workforce. In Virginia – where Crossroads was airing its small business ads repeatedly – managers, including small business owners, make up .898 percent of state employment.
Republicans might argue that by appealing to small business owners, they are also appealing to their employees, but that’s a tenuous connection to make, especially in a thirty second commercial. In this appeal, Romney and the Republicans seem to be in the grips of an older American ideology from a time when many Americans (and particularly farmers) were small business owners and when Americans who were not aspired to be. But 2012 is not 1832 or 1888.
The National Debt: At the Republican convention in Tampa, there were two huge digital clocks on display counting out the increase in the national debt. When Romney spoke in Westerville, and at other campaign rallies, a huge debt clock stood behind the podium. In his speech, Romney charged that Obama had increased the national debate to “over $16 trillion” and warned that if Obama were re-elected, “I can assure you it will be almost $20 trillion in debt.” And the super PACs have again followed Romney’s lead. A Crossroads ad on the economy begins, “Obama has added $4 billion in debt every day.”
Hardline Republican voters do seem to be worried about the national debt. It is also a popular issue among Tea Party members. But it doesn’t even show up in opinion polls. What does show up are budget deficits, and these too rank fairly low except among Republican voters. A Pew Research Center Poll released September 24 found that budget deficits ranked fifth in voters’ priorities after economy, jobs, health care and education. It was the top concern for Romney voters, but ranked eighth among Obama supporters. Among undecided voters, it ranked fifth. That makes it a poor choice for rallying support for Romney’s candidacy outside the already committed. Yet Romney and the Republicans continue to emphasize debt and deficits.
Here, too, they appear to be living in the past. For much of the twentieth century, Republicans did run on a promise to balance the budget by cutting spending. But Ronald Reagan changed all that. In 1976, Reagan challenged Gerald Ford on these grounds, and was defeated for the nomination. In his 1980 campaign, Reagan fell under the spell of supply-side economics, which was a politics as well as an economics. It focused Republicans on increasing economic growth by cutting taxes. It ignored budget deficits and spending cuts aimed at social security or other popular programs.
Reagan and the supply-siders understood that while opinion-makers regularly decried budget deficits, and while voters, if pressed, would say they don’t like them, they didn’t actually look for candidates who promised to cut the deficit; they looked for candidates who promised jobs and growth and a higher standard of living. In May 1980, the late Jude Wanniski, who helped formulate the strategy, put it this way: “In 1976, Reagan got into difficulties with his $90-billion spending cut plan … Now he understands there is a way to move the economy to a higher level of efficiency and productivity without first throwing the widows and orphans out into the snow.”
In 1984, Walter Mondale adopted the older Republican script and ran a campaign promising to cut the deficit by raising taxes. He lost in a landslide. George H.W. Bush in 1988 ran a supply-side campaign (“Read my lips – no new taxes.”) And in 1992, a victorious Bill Clinton ignored deficits until he was actually in office. Romney seems to be running an older Republican campaign – or if you like, a Republican version of Mondale’s disastrous 1984 campaign. He seems to have learned nothing from the last forty years of political history. 
19 comments
This article is not quite completely accurate. Clinton ran in 1992 on a plan to reduce the deficit by increasing taxes not on the middle class, but on the rich, though the political press was shocked, shocked when he followed through on that plan in 1993--and the same press largely gave the public the impression that everyone's taxes would go up, which was a bold-faced lie (your average family in fact payed slightly less because of the 1993 Deficit Reduction Act because of increases in tax credits). But, yeah, the main point seems right. Regardless of the truly immense deficits we're facing right now, in a time of economic emergency (which is largely their cause), they're not voters' primary concern.
- Curran1
October 2, 2012 at 2:17am
Shouldn't that "bald-faced lie," Curran? (Sorry, the pedant in me broke loose.)
- AaronW
October 2, 2012 at 5:11am
Shouldn't that be... Ugh.
- AaronW
October 2, 2012 at 5:13am
Agreed, Romney is playing the Supply-Side Card. Cut taxes, enormously expand spending, then use the resulting enormous deficits to kill/privatize Social Security, Medicare/Medicaid, those dirty "Entitlements" Republicans are always saying we can't afford. But to make that happen, you MUST argue that Deficits will kill us at some point. Otherwise, this "back-door" approach toward killing the New Deal doesn't work. Except it requires a lot of memory loss on the electorates fault -- after all, Republicans RAN those deficits for decades. Why should Social Security pay for military over-spending? But this argument makes even less sense now. If they were serious, they'd demand raises in tax-rates -- after all, it was cutting tax rates that created the deficit. And now that we have an over 1 trillion dollar deficit, even killing Social Security wouldn't pay for it. While raising taxes in a Recession makes some sense, cutting spending certainly does not.
- AllanL5
October 2, 2012 at 9:09am
I have wondered about this myself how Romney could insist on glorifying business owners and view the vast majority of Americans as nothing more than potential employees who should be grateful in the mere offer of a job by one of our great business owner overlords that we would choose Romney as the exemplar. Outside of a job what does Romney offer the American people? As one of the 47% (having 3 children and a mortgage means we pay no net income taxes) Romney has literally nothing to offer and with his obsession about the debt looms the threat that my mortgage deduction and tax deduction will also go away. The man is a train wreck. I can't wait until the election is over with just so I can see the back of him for good. If not, if the unthinkable happens then God help us all.
- blackton
October 2, 2012 at 9:28am
I think that Romney and the Republicans talk about "small businesses" so much because they want to propose business-friendly policies, but are aware that "small businesses" sound like a more sypathetic group to the public than "big business" or "large coporations".
- NateG
October 2, 2012 at 9:39am
"Presidents who seek re-election in the midst of a sagging economy don’t usually win. The prime example is Herbert Hoover in 1932, but there is also Jimmy Carter in 1980 and George H. W. Bush in 1992." I really do wish this silliness would stop. Hoover: the economy tanked under his watch and he had no solutions. Carter: there was that pesky little thing called the Hostage Crisis. And then there was the Reagan deal with Iran to screw Carter. And then there was John Anderson. Not to mention that Kennedy challenged him - so the party was not unified - and Kennedy's challenge was not based on the economy. Bush the Father: remember how he got elected; remember the looking at the watch during the debate; remember him being amazed by laser scanners; remember his solution to the recession: "Call Jim Baker and get him to fix the economy like he did Iraq." Generals fight the last war; pundits analyse the last election. False analogies are as problematic in political analysis as closed-system analyses. People generally remember who caused the economy to sag; they understand that Obama was only one half of the legislative equation since 2010; they see the rest of the world not doing that much better; the stock market is hitting record numbers; and the Republicans are promising more tax cuts for the rich and dismissing half the population as layabout welfare recipients. The wonder is not that Obama is ahead; it is that this is a close race.
- icarus-r
October 2, 2012 at 10:59am
Just to be clear, every article that has the following sentence "Presidents who seek re-election in the midst of a sagging economy don’t usually win" should begin with "Conventional wisdom of lazy pundits states that"; the sentence should be immediately followed by, "Conventional, perhaps; there is no wisdom in the platitude."
- icarus-r
October 2, 2012 at 11:02am
Republicans lie, not only like dogs, but like curs. Obama has cut taxes to small businesses up to 18 times. Romney should be going to his big-business buds and asking them to hire Americans. Of course, if by some miracle he did, they would laugh in his face. What, give up our huge salaries and bonuses--just so you can be president? Are you kidding, Bozo?
- magboy47.
October 2, 2012 at 11:28am
"Just to be clear, every article that has the following sentence "Presidents who seek re-election in the midst of a sagging economy don’t usually win" should begin with "Conventional wisdom of lazy pundits states that"; the sentence should be immediately followed by, "Conventional, perhaps; there is no wisdom in the platitude." You're overreaching here, Icarus. Maybe you mean to highlight the careless phrasing, but the underlying point comes from political science, not the daydreams of pundits.
- Fishpeddler
October 2, 2012 at 1:15pm
Fish: Let me amend it then to "lazy pundits and political scientists". Three data points, and for two of them the recession happened on the watch of the sitting president. 2012 was going to be different because of 2008, Bush II, 2010, etc. To repeat the mantra is intellectual laziness; to draw conclusions on that basis is simply silly.
- icarus-r
October 2, 2012 at 2:19pm
That should maybe read 'political "science"', Fishpeddler, with big fat scare quotes, 'cause it ain't very scientific at all. I'm involved professionally with medical science which, like political science, is heavily reliant upon statistical reasoning: human physiology and behavior are just too damn complex to be modeled directly, so most predictions must be probabilistic. The thing is, no medico worth her salt would draw any inference whatsoever from a data set comprising an n of 28 (the number of presidential elections since 1900) in which 3 had had the exposure of interest (incumbent seeking reelection + slack economic growth with high unemployment). Icarus's point is a good one whether or not it's pundits or poly sci professors you choose to indict; the fact that on the only three occasions during the past hundred plus years when an incumbent president sought reelection in the setting of a seriously sputtering real economy the incumbents all lost their reelection bids means tells us zilch about the reelection chances of the next incumbent to face such challenges. Obviously high unemployment on election day is a problem for an incumbent and makes his a harder row to hoe, but the idea that its an inevitable loser is just silly.
- AaronW
October 2, 2012 at 2:32pm
icarus and aaron, I'm not sure if it was my fault or yours, but my point has been missed. It is reasonable to criticize an unnuanced formulation like, "Presidents in situation x don't usually win. The situation is x, so this president most likely won't win". In getting on your high-horses about it, though, you don't want to throw out the useful idea imbedded in the statement, which is that a bad economy is a significant impediment to reelection for an incumbent president. The literature on this phenomenon is impressive and cannot be simply dismissed as 'laziness'. And, Aaron, I don't even know how to begin to respond to your comment about "the idea that its and inevitable loser is just silly". I can't for the life of me figure out who said anything about it being an inevitable loser. You appear to have ventured into straw man territory here.
- Fishpeddler
October 2, 2012 at 5:01pm
Romney's intensely narrow focus on owners, and failure to acknowledge or even mention workers (including those who are working in our wartime military), except as "them" (and his apparent concept of those who work but do not own as "victims" and dependents rather than contributors) is disturbing, revealing, and a huge argument against his ability to govern this complex country. As for the deficit and debt -- the history of Republican governance over the last 30+ years, plus their recent refusal to even consider modest revenue increases balanced with spending cuts to address the deficit -- has left them with no credibility on the issue. On this issue they repeatedly act like the boor who invites the whole office out to a lavish dinner and waits until the check is presented to tell them that he left his wallet at home.
- esmense
October 2, 2012 at 5:38pm
So, GOP either made their plan awhile back, and forgot/neglected to refresh their model with more current data; or they are so used to talking just to each other, that they they have no idea that most of us have no idea what their platform is, nor do we particularly care. When you have to work this hard, as the customer, to understand what the supposedly slick ad guys are pitching, you likely conclude it is not worth your time, and vote blue. They seem to believe their ideas are truly winners, no matter how much we grimace when they pitch them, and they interpret that reaction as they need to improve their pitch. But the dogs don't like the proverbial dog food, ask Seamus.
- smabry03
October 2, 2012 at 8:51pm
we’ll be able to let small businesses keep more of their money, so they can hire more people.” Does anyone else see this as not making any sense? Is our problem that businesses want to hire but don't have enough after tax money to do so? Under what circumstances will lower income taxes cause a business to hire someone if there is no demand for it or not hire someone if their taxes are too high, especially since wages are fully deductible?
- Nusholtz
October 2, 2012 at 9:08pm
Nusholtz, you are right. At the present time, businesses, large and small are sitting on large amounts of capital. But they are investing it neither in capital goods nor new hires--for the good and sufficient reason that there is no demand for more of their products than can be produced with the capital goods and people they already have. Our problem is a lack of demand, not a lack of capital. So giving tax breaks to the rich will not help. It will stimulate neither demand nor investment.
- Vekert
October 2, 2012 at 10:00pm
you didn't say it, fish, but pundits and political scientists have said over and over again that the "economic fundamentals" are the decisive factor in deciding presidential election outcomes, making statements on the order of, "No president has won reelection in the face of unemployment higher than 8%," the not so subtle implication--tho I acknowledge that they're smart enough to avoid terms such as "inevitably"--being that no president can win reelection in the face of such high unemployment. I was exaggerating a bit, but not too much.
- AaronW
October 2, 2012 at 11:57pm
Fish - agree with Aaron. The issue is not that poliscis and pundits indicate that the state of the economy is one of the factors relevant, and perhaps quite relevant, in the outcome of a presidential election. After all, poll and poll indicates that "the economy" is foremost in voters' minds. It is reducing the entire outcome of the election to the unemployment figure that demonstrates laziness. There is no magic to 8% or 9% or 7: the entire political context determines what happens, and that is just too difficult to opine on.
- icarus-r
October 3, 2012 at 9:27am