SUNDAY, SEPTEMBER 12, 2010
KLMNO Sunday OPINION DANA MILBANK Keynes,
the GOP’s new whipping boy
“I
n the long run we are all dead,” the great 20th-century economist John Maynard Keynes once said.
As usual, Keynes was right, and in this case
it’s probably for the better: Keynes didn’t live to see the Republicans of 2010 portray him as some sort of Marxist revolutionary. “The president will use the Labor Day holi-
day as the launching pad for yet another gov- ernment stimulus effort, another play called from the same failed Keynesian playbook,” de- clared Rep. Eric Cantor (Va.), the No. 2 Repub- lican in the House. “The point is that the Obama Keynesian-on- steroids has not worked,” Sen. John McCain (Ariz.) announced on Fox News. Rep. Paul Ryan (Wis.) determined that “the
Keynesian experiment, which was more spending, has failed to produce jobs.” These men get their economic firepower from conservative think tanks such as the Cato Institute (which writes of “Barack Obama’s Keynesian Mistake”) and from business lead- ers such as Intel’s Paul Otellini (“their experi- ment in Keynesian economics [is] not work- ing”). Together, they’ve managed to turn the Keynesian notion of economic “stimulus” into such a dirty word that President Obama and his aides are afraid to let it escape their lips. What’s with the hate for Maynard? Perhaps these Republicans don’t
realize
that some of their tax-cut proposals are as “Keynesian” as Obama’s program. There’s a fierce dispute about how best to respond to the economic crisis — Tax cuts? Deficit spend- ing? Monetary intervention? — but the argu- ment is largely premised on the Keynesian view that government should somehow boost demand in a recession. Or perhaps, more ominously, these Repub- licans know exactly what they are saying when they reject Keynesian intervention: that the government should do nothing to help the millions out of work or to rebuild confidence in the economy. I called Harvard’s Greg Mankiw, a former chairman of George W. Bush’s Council of Eco- nomic Advisors, to ask about the GOP assault on Keynes. “I don’t think it’s useful to frame it as Keynesian and anti-Keynesian,” Mankiw said of the attack on the long-dead Briton. Bush, he said, used “Keynesian logic” in designing his tax cuts. “The idea that demand is an important driver of the economic cycle” — that’s Keynes- ian — “is uncontroversial,” he said. Here’s what Mankiw wrote about Keynes in
November 2008 in the New York Times: “If you were going to turn to only one economist to un- derstand the problems facing the economy, there is little doubt that the economist would be John Maynard Keynes. Although Keynes died more than a half-century ago, his diagnosis of recessions and depressions remains the foun- dation of modern macroeconomics.” With so much of Keynesian theory univer- sally embraced, Republican denunciation of him has a flat-earth feel to it. Will they next de- mand the abolition of NASA because it’s “Gali- leo on steroids?” Shut down the National In- stitutes of Health for being a “Hippocratic mistake?” Strip funding for those “Einsteinian experiments” at Los Alamos? Demand a halt to public schools teaching from the “failed Darwinian playbook?” (Oh, wait. They did that last part already.) Keynes’s place in economics is similarly un- assailable, and the assault on him lends credi- bility to the charge that the Republicans lack ideas of their own and are merely generating opposition for its own sake. There’s a cogent argument to be made that Obama’s stimulus was ill-designed and ineffective, but dismiss- ing the most important figure in economic thought in the last century says less about Obama than about his accusers. Writing last year in the New Republic, Rich-
ard Posner of the conservative Chicago school of economic thought argued that Keynes’s 1936 General Theory “is the best guide we have to the crisis. . . . Economists may have forgotten The General Theory and moved on, but economics has not outgrown it.” Economists offering alternatives to Keynes
devised mathematical models showing how markets would behave efficiently. But those ideas collapsed along with everything else in 2008. The uncertainty of the financial crisis caused a spiral of falling demand, investments and employment — just as Keynes had said would happen. A sudden rise in savings among anxious consumers accelerated the de- cline — the “paradox of thrift” that Keynes had warned about.
With business and consumers refusing to spend, Keynesian theory says it’s up to the gov- ernment to stimulate consumption — by spending more or by using tax cuts to stim- ulate demand. There is an alternative to such “Keynesian
experiments,” however. The government could do nothing and let the human misery contin- ue. By rejecting the “Keynesian playbook,” this is what Republicans are really proposing.
danamilbank@washpost.com
TOPIC A Will President Obama’s midterm campaign push help the Democrats?
LARRY J. SABATO Director of the University of Virginia’s Center for Politics
Presidents like to believe that their work can tame the seas. But when fierce political winds build a towering wave, even a presidential-size yacht can be capsized. President Obama can raise money, draw crowds and TV cameras, and create headlines for his favored candidates. Here and there, smart moves by the White House might pull an endangered Democratic candidate to victory. Overall, though, the combination of persistent high unemployment, little income growth, a natural midterm snapback, intense enthusiasm among Republicans in a low-turnout election and big Democratic vulnerability after massive gains in 2006 and 2008 makesmost presidential visits and pronouncements mere background noise. We’re headed for a major pendulum swing. Since World War II, the party of the president has lost an average 24 House seats and three to four Senate seats in midterm elections. Count on a doubling of those numbers in 2010. The most significant Democratic disasters will likely come at the state level. On the eve of redistricting, Republicans will gain perhaps eight governorships, 400 to 500 state legislators and eight to 14 state legislative chambers. It’s a “check-and-balance” moment. Obama
will have to adapt to divided government — something Americans have ordered up for 36 of the past 60 years. The good news for Obama is that presidents often fight what is in their best political interests. Assuming decent economic growth before 2012, a rambunctious Republican Congress will give the president an institutional devil figure to blame and run against for reelection. The pendulum swings both ways increasingly quickly.
MARY BETH CAHILL Manager of Sen. John Kerry’s presidential campaign; former chief of staff to Sen. Edward M. Kennedy
When Barack Obama turns his single-minded attention to a goal, whether it be health care, financial reform or shoring up the banks, he achieves it. Americans know that President Obama is not responsible for the economic situation we face, but for Democrats to win, he has to continue offering an overarching message of concern for the everyday lives of Americans: help them see that the improvements in their lives that he promised are happening now and that he needs Democratic members of Congress to achieve more. Beyond relaying that message, Obama will
have to make judicious decisions on where and how he can be most helpful. The president is in the best position to do what Democrats need most: raise money to combat the waterfall of funds coming from Republican donors and large corporations hoping for a return to the Bush years. This is going to be a tough year for Democrats, but it is foolish to forecast the outcome of the election now. The Republican Party is in disarray, and handpicked candidates are tumbling to defeat in primaries. The jobless and trade numbers have begun to move back, and continued strength will make a better climate for Democrats as likely voters make their decisions. There are debates, advertisements and news stories yet to come that will help voters see the candidates in clear relief. If he assists in raising funds and setting a
message, the president will help all of these factors play to Democrats’ favor.
DOUGLAS E. SCHOEN Democratic pollster and author
President Obama’s increasingly harsh campaign to revive the sagging fortunes of the Democratic Party is almost certainly going to fail. Instead of attempting to further divide an
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already polarized America with attacks against the Republicans for both creating the economic problems we face and failing to propose constructive solutions to them, the president should do what Bill Clinton did in 1995 when he succeeded in winning support from Newt Gingrich and the Republican Congress for a balanced budget. That is, Obama should invite Senate
Minority Leader Mitch McConnell and House Minority Leader John Boehner to the White House and propose a grand bargain to them: extending all the Bush tax cuts for two years as former budget director Peter Orszag has suggested, as well as supporting the research and development tax credit and the tax credit for capital expenditures. In return for supporting these proposals, which enjoy broad support on the Republican side of the aisle, the president can insist on some modest level of infrastructure spending. The Republican leaders will have to attend,
and they will almost certainly say no to the bargain. And if they oppose broad-based, bipartisan policies to stimulate the economy, the president will have a real-world, contemporaneous example of why swing voters should return to the Democratic Party. The Republicans will have proved to be the party of “no,” even when their own proposals dominate the discussion.
Obama will appear to be the centrist, unifying figure he promised to be in his campaign. And if by some chance the Republicans go along, the president and the Democrats will have a victory in the run-up to the November election that will almost certainly command wide support in an electorate that is desperate for solutions to our growing economic problems.
ED ROGERS White House staffer to Ronald Reagan and George H.W. Bush; chairman of BGR Group
The president could be useful to a few Democrats, but overall he’s a problem for his party in November. A president’s impact on a midterm election at the eleventh hour is limited. In 1986, I worked in the White House political office for a then-popular President Reagan. He campaigned hard for GOP Senate candidates in the last few weeks, and we still lost control of the Senate.
Obama is much less popular than Reagan
was, so his upside for Democrats is much smaller. He also has two particular problems: style and substance. Stylistically, Obama is not a good come-from-behind performer. His cerebral presentation is chilling, and his efforts to look folksy by rolling up his sleeves and dropping his g’s look contrived. Substantively, the terrible results he has produced for the economy and the unpopularity of the rest of his legislative agenda are anchors that weigh him down. Obama’s sub-50 percent job approval rating means he is a big part of the Democrats’ problem. The president should have invested more time raising money for priority campaigns. Now it is too late, and most Democratic candidates in competitive races probably don’t want even a lucrative visit from the president.
DANA PERINO White House press secretary to President George W. Bush
Whether President Obama’s midterm push will work depends on your definition of success. Is it that the Democrats hold the House? Lose the House and keep the Senate? Lose the House and the Senate but shed the conservative Democrats who have been a thorn in the party’s side? If it’s either of the first two, it won’t do much to change the outcome. The discomfort with the president’s policies can’t be spun away. After his speeches this week, he may as well have been a tree falling in the forest — the lack of support from even his own party was deafening. Regardless of who holds majorities after the
election, the margins of power will narrow. Many centrist Democrats who voted for the stimulus and then more reluctantly for health-care and cap-and-trade legislation will lose — and, in some ways, party purists on the left want that. And because Obama’s midterm rhetoric has demonized everything Republicans do or say, questioned their motives and ignored their ideas, the White House will also find it hard to persuade members to work together to get things done. Then again, maybe they would welcome that — get nothing done for the next two years and blame it on Republicans.
TOPIC A ONLINE: Linda Chavez, chairman of the Center for Equal Opportunity
R
A23
OMBUDSMAN ANDREW ALEXANDER Md. voters have a right to feel ignored
mayor and contests for D.C. Council. But if you’ve relied on The Post for coverage of campaigns in Montgomery County or Prince George’s County, you may be excused for feeling ne- glected. Until last week, The Post largely ignored scores of contested races there. The disparity is glaring. About 50 stories or col- umns about District races appeared on The Post’s news pages from Aug. 1 through Friday. That’s at least three times more coverage than that for races in Montgomery County, and roughly 10 times more than that for Prince George’s. The extensive coverage of District races is appro-
I
priate, especially given D.C. Council Chairman Vin- cent C. Gray’s bold challenge to incumbent Mayor Adrian M. Fenty. The outcome is important for Dis- trict residents. And many living in the suburbs, es- pecially those who work or play in the District, also are closely following the campaign. The city is the hub of the region, after all. And it’s the nation’s cap- ital.
But the huge coverage gap is confounding, given who reads The Post. Its daily circulation in Mont- gomery County far exceeds that in the District (about 118,000 to 90,000, according to the latest breakdowns). On Sundays, it’s about 150,000 in Montgomery, compared with about 95,000 in the District. And while daily circulation in Prince George’s is smaller than in the city, it exceeds the District on Sundays. So readers feel short-changed. In those two Mary- land counties, coverage has been late, and little.
f you care about Tuesday’s primary elections in the District, you’ve benefited from The Post’s wall-to-wall coverage of the fascinating race for
That’s unfortunate, because the stakes are high.
In Prince George’s, voters will elect a new county executive, an array of County Council members, a state’s attorney and a sheriff. Like the District, the county is so heavily Democratic that victory Tues- day is tantamount to winning the general election. In Montgomery, races for County Council, state
legislature and other offices are hotly contested and well financed. Yet The Post has provided scant coverage about where candidates stand on issues or even who is running.
“If a resident wanted to know something about the candidates and their positions, you would not find it in The Post,” said Richard B. Kabat, cam- paign treasurer for Montgomery Democrat Mark Winston, who is running for the Maryland House of Delegates from the 16th District (which includes Bethesda). Coverage has been “pretty thin,” agreed Eric C.
Olson, an incumbent Democratic Prince George’s council member. The “lack of Post coverage . . . is on the mind of
every politician that I’ve talked to in this county,” said Adam Pagnucco, a Montgomery resident who writes the popular Maryland Politics Watch blog. “They all comment on how The Post is absent.” “I’m not saying the [D.C. mayor’s] race shouldn’t be covered. I’m just saying it shouldn’t be the only coverage,” said Sharon Dooley, a Democratic council candidate from Montgomery’s 2nd District, the northern part of the county. She urged Post editors to “look at your demographics. Who reads your paper?” Candidates and public officials always want more media coverage, of course. But of the 11 from Mont- gomery and Prince George’s who were interviewed
for this column, most spoke of a decline in coverage that coincides with the paper’s staff cuts in recent years. Top Post editors heard complaints in meetings with the Montgomery County Council in May and the Prince George’s County Council in June. “We got the warning. The shot was fired across the bow,” recalled David J. Jones, the former Post pub- lic relations manager who arranged the meetings as part of an outreach campaign. The limited election coverage in the two counties is a “missed opportunity,” he said. “That’s where our revenue dollars are, and that’s where our readers are, and you don’t get one without the other.” Emilio Garcia-Ruiz, The Post’s top editor for lo- cal coverage, said staffing reductions are partly to blame for the diminished Maryland election cover- age. “We just don’t have the numbers of people we used to have,” he said, acknowledging that “we probably should have moved some staff around” to assign more reporters to the two counties. Institu- tional knowledge of local issues and politics also has been lost through staff buyouts and restructur- ing.
But readers want coverage, not explanations. “We have tons of subscribers who respect The
Post,” said Pagnucco. But if it can’t provide sustained local coverage, “they’re going to go elsewhere.” He’s right. A news organization thrives by serv- ing its community. Not just parts of it.
Andrew Alexander can be reached at 202-334-7582 or at
ombudsman@washpost.com. For daily updates, read the Omblog at
http://voices.washingtonpost.com/ ombudsman-blog/.
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