The Right, Obama, And The Deficit

According to Rove, nobody ever lost an election because of a deficit. Of course it helps if the deficit is sold to the public as no deficit at all. Militiary spending? Doesn't count. If Rove advised Obama, not only military spending but stimulus spending wouldn't count. A fraud? Hardly. What is a bigger fraud than the social security "trust fund"?

Not for the first time, Rove is wrong. George H.W. Bush lost because of the Ross Perot's candidacy, which was a direct result of a) the deficit; and b) failure to "finish the job" in Iraq.

As far as I know there may not be a bigger fraud than the social security "trust fund", unless it's the whole Ponzi scheme which includes SSI, Medicare, and Medicaid. But then, the dogged insistence of Democrats in calling their party "Democratic" may top it.

The social security "trust fund" is not a fraud. It is an accounting convention for keeping track of how much of the cumulative funding of the government has been excess FICA taxes, something worth knowing as we plan to maintain actuarial balance. No one who knows anything at all about the social security system thinks that it is anything other than a "pay-go" system. Indeed, there is no practicable means by which a national pension system could ever be anything else.

Nor are Medicare and Medicaid a "Ponzi scheme." Current consumption is paid for with current output, now and for all time. It cannot be otherwise, except to an extremely marginal extent. We cannot store up medical services to be consumed later; the quantity of consumption goods/services that can be stored for future use is de mimimis.

In light of the simple realities of economic life, one wonders what the point of such claims of "fraud" are? The only thing that I can think of is fundamental hostility to the idea of public finance of either a pension or medical system. But them, we know that Republicans have hated social security and Medicare and Medicaid since their inception. Socialism, they said, that will destroy our country, its moral fiber, its will to fight, and blah, blah, blah.

And what of the dogged insistence of Republicans in calling their party "Republican?" Wouldn't the "Authoritarian party" or the "Anti-democratic, Minority rule, We Deserve Excess Representation, Owned by Lobbyists and Monied Interests party" be more appropriate?

Did Iraq play any role in Republican and right-leaning independent support for Perot? I recall no such phenomenon being discussed at the time -- after all, Bush's popularity was highest in the months immediately after not "finishing the job" in Iraq. Freeing Kuwait from Iraqi occupation, destroying most of the Iraqi military's offensive capability, and requiring Saddam to disarm were widely accepted at the time as an appropriate "finish" to the "job," and really only controversial among the farthest reaches of the rightwing thinktankocracy. Had public opinion on the point really shifted by fall 1992 to where it would be in 2003? I'd be grateful if Powell could point to the public opinion data that supports this reading of 1992.

Setting Iraq aside, Powell is half right on the role of the deficit. Yes, the deficit was the issue that made Perot possible. But Bush had already taken politically painful steps to address the deficit. We weren't on a path to a balanced budget yet -- that would take Clinton's first budget in 1993, on which every Republican in Congress voted no -- but Bush had worked out a deal with Congress that stopped the bleeding. Yet Bush faced revolts within the GOP coalition on several fronts, all of them based on rightwing anger at Bush for raising taxes and limiting spending growth on conservative hobbyhorses. So while the deficit as a political issue gave Perot an opening, Republican defection from Bush was largely a repudiation of Bush's efforts to address the deficit. The 1992 race actually highlights the political dangers inherent in taking responsible action to reduce deficits at least as much, and probably more, than it illustrates the political costs of deficit spending.

After all, Reagan exploded the deficit and won reelection. Reagan further exploded the deficit, though not quite as much as the first time around, and got his VP elected president. Then Bush took the first meaningful steps to fix the deficit, and faced first a tough primary challenge for renomination and then lost the presidency. Clinton set the budget on a path to balance and was crushed in his first midterms and barely won reelection. Then Clinton actually balanced the budget and his own VP, a respected deficit hawk, was defeated to succeed him by a man who openly promised a return to massive deficits. Then the second Bush returned to massive deficit spending, and was soundly reelected. This long history suggests that on this point, Rove is more right than wrong. Deficit spending has never been a political liability for any Republican, whereas Republicans (and Democrats) are routinely punished by voters for fiscal responsibility. This goes a long way toward explaining why modern Republicans do not practice fiscal responsibility -- and why Democrats, who more often do, fare so poorly in national elections.

I think roi's suggestion for re-naming the Republicans, while pretty accurate, is over-long and insufficiently catchy. Personally I think we should dispense with the fraud altogether, admit that we have a single-party, incumbent-dominated system in most meaningful ways, and settle on Republicrats.

It's refreshing to see rhubarbs agreeing with Karl Rove, and he brings an excellent case. On the Perot angle, I don't have immediate access to a lot of polling data, but I spent a good deal of time during that campaign at Perot events and interviewed a ton of his supporters in Connecticut, Massachusetts, Texas and Louisiana. I found that by that time dissatisfaction with leaving Saddam in Baghdad, particularly in the wake of Bush's disgraceful performance of calling on Iraqis to "rise up against the dictator" then sitting on his hands while tens of thousands of them were massacred, was the most common complaint after the deficit. Not really scientific, but I remain persuaded that this was a major factor in his losing effort--after his breaking of the "read my lips" promise, of course.

Interesting reportage, RP. I was active in the Harkin and then Clinton campaigns in a couple of Midwestern states that year, and so I didn't have much personal contact with actual Perot voters. But the umbrage over Bush breaking his "read my lips" pledge only goes to show that Rove is largely right on this one: Many Perot voters were punishing Bush for fighting the deficit. (And as a Ventura voter myself, I can vouch for the complex and sometimes contradictory reasoning that goes into supporting a third-party candidate!)

It's a logical conclusion rhubs (that Bush 41 was punished for fighting the deficit), but if so why did everyone love Clinton? His first budget built on the Bush tax hikes to solve the deficit problem conclusively, at least for the time being, and I believe this was a big part of his popularity.

A lot of the Perot people had also been involved with the Concord Coalition, which made the deficit Public Enemy #1, and they all recognized that it wasn't going to be dealt with by cuts in discretionary spending alone.