Washington’s fake policy arguments

July 25, 2012

Economists Betsey Stevenson and Justin Wolfers write that "the debate in Washington about economic policy is phony. It’s manufactured. And it’s entirely political."

Well, yeah.

They go on to report the results of a survey conducted that the University of Chicago’s Booth School of Business conducts among economists. Turns out that there's wide agreement that the stimulus created jobs, TARP was necessary, market factors drive gas prices, tax cuts reduce revenue, tax increases and spending cuts will have to be part of a deficit solution and more.

I'd only add that this isn't just true among economists. It's true among policymakers more generally. And it's even true among politicians.


Washington in one photograph. (Jewel Samad/AFP/Getty Images)

My job means I spend a lot of time in rooms with policy experts on both sides of the aisle. I have rarely walked out of those rooms thinking that it would be difficult for the two sides to reach a private consensus. My job also means I spent a lot of time reporting on rooms where politicians on both sides of the aisle are trying to come to agreement. I have rarely reported on one of those processes where it didn't seem like the participants could reach a consensus.

The problem comes when the door opens. After Max Baucus's health-care working group -- better known as the Gang of Six -- broke up, I asked Sen. Kent Conrad what happened. I think back to his answer often:

What happened? What lesson did you take?
I honestly don't know. I think part of it is we ran out of time. We were very close to reaching a conclusion. Now whether or not the politics would have ever permitted all three of the Republicans to agree, I don't know. But I can tell you in those discussions, right up to the end, they were very collegial. They were very professional. There appeared to be solid agreement on the outlines of the plan. If somebody had participated in those discussions, I don't think you could have said there was an ideological divide or a partisan divide. it was very professional discussion. You know, we met 61 times.

It seemed that as time went on, agreement became harder. The politics made it more difficult.

You're right about the politics making it more difficult. The dynamic in that room was very positive and very constructive. We kept making progress until we just sort of ran out of time. I felt we were getting to the point where we were reasonably close. Several more weeks, and there might have been an agreement. But that's outside the political discussions.

As a rule, Washington isn't riven by policy disagreements. It's riven by political disagreements, and one in particular: The two parties disagree over who should win the next election. The majority tends to think they should win it, and they tend to think the way they'll win it is to get popular things done. The minority tends to think they should win it, and they tend to think they way they'll win it is to keep the majority from getting popular things done.

This is an insight Republicans have applied with more consistency and success than Democrats. Early in George W. Bush's first term, a number of Democrats crossed the aisle in return for policy concessions, first on the Bush tax cuts, then on No Child Left Behind, and then on Medicare Part D -- and that's before we even get into post-9/11 foreign policy. But after Bush was reelected, Democrats simply refused to negotiate on Social Security, and did Bush tremendous damage in the process. After Obama was elected, Republicans pretty much refused to negotiate on anything, and did Obama tremendous damage in the process. In both cases, the White House would have accepted deals that policymakers on both sides would found reasonable in private, but that they could no longer even consider supporting in public.

In a sense, my New Yorker pieces are trying to explain the mechanisms behind this exact phenomenon. The first was an effort to show why presidential leadership doesn't reliably lead to policy compromises, and the second was an effort to show why policy concessions  don't reliably lead to policy compromises. But both were trying to answer the question of why policy deals that seem so achievable in private fall apart so quickly in public.

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Dylan Matthews · July 25, 2012