The Dems Lost but Who Won?

November 3, 2010

For immediate release (670 words)
With Election 2010, the GOP controls the U.S. House with a solid majority, tightened up the Senate and made considerable gains at the state and local levels — from governors’ mansions to city councils.
In one sense, this is nothing new. It is common for the president’s party to lose seats in a mid-term election. In 1982, under President Ronald Reagan, Democrats increased their advantage in the House from 50 to 103 seats during a deep recession. But maybe this election points to something deeper, since change in party control has become more volatile.
In 2006, the GOP lost Congress because of disenchantment with the war in Iraq, high-profile scandals and the handling of Hurricane Katrina’s flood of New Orleans. In 2008, with a struggling economy, Barack Obama defeated John McCain and cemented the Democratic Congressional majorities. But two short years later, Mr. Obama and his Democratic Congress have been refuted in stunning fashion — as the economy continues to stumble and their efforts are seen as both spendthrift and ineffective.
Part of this is the gap between campaign promises and the ability to deliver. Activity is easy, but accomplishment is difficult. In particular, Congress, Mr. Bush and now Mr. Obama have been quite active in trying to fix the economy with three years of “stimulus” — politically tempting but economically dubious.
Government spending must come through taxes, debt or inflation. The chosen path over the last decade — more debt and the risk of inflation — leads to relatively subtle troubles. Meanwhile, other recent policies (most notably, health-care reform) have made it more costly and more risky to engage in economic activity, impeding the market’s recovery from the Great Recession.
So, what can we make of this?
In sports, it’s often said that one team lost a game — rather than the other team won the game. The same can be true in politics. Victories for the Democrats in 2006 (and even 2008 to some extent) and for the Republicans in 2010 were more about one side losing than the other side winning. The electoral results are more about anti-incumbency and frustration with “Washington” than excitement about either major political party. If the GOP doesn’t give voters a reason to be supportive, the tables will turn again — and soon.
Let’s look more closely at three groups of voters.
• The Tea Party was a significant driver over the last two years. Its eclectic mix of (lower-case L) libertarians and various types of “conservatives” are fed up with particular aspects of public policy (e.g., health care), concerned about the economy (e.g., jobs, national debt), or more generally “dissatisfied with Washington.” Similar movements have arisen in the past — in recent memory, “Reagan Democrats” and support for Ross Perot in 1992 and 1996. Their concerns will be addressed or they will continue to vent. Republicans have an opportunity here, but are constrained in what they can do with economic policy, given the debt and the difficulties in cutting government spending.
• It has been said that younger people get much of their “news” through Jon Stewart, Steven Colbert and Comedy Central. Their “Rally to Restore Sanity” was a direct response to the Tea Party. What does the “Daily Show” generation want? As a group, they lean liberal politically, but their dominant characteristic is cynicism toward politics. On the surface, they might favor more government, but their underlying tendency is to have little faith in government.
• Some Republicans will push for efforts on social policy. But for better or worse, little of the current debate points to social policy. As is common in a recession, the focus is on the economy. Efforts to inject social policy into the political conversation will be awkward and might backfire.
For now, shared power in Washington probably means more gridlock and less “getting done ”— often a good thing. Sometimes it results in “compromise” — a mixed bag. Factions within both parties will make it even more difficult to govern. How will Congress and particularly Mr. Obama approach this challenge? Will he choose the path of a compromising Bill Clinton after 1994 or a contentious Harry Truman after 1946? Over the next two years, one side will be conciliatory or more likely, the time will be dominated by posing and positioning, going into 2012.
One more thought: Even though Truman, Dwight Eisenhower and Clinton lost control of Congress in their first mid-term elections, each of them was re-elected two years later. 

Eric Schansberg, Ph.D., professor of economics at Indiana University-New Albany, is an adjunct scholar of the Indiana Policy Review Foundation. In 2008, he was the Libertarian candidate for U.S. representative in the 9th Congressional District.


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