Monday, November 02, 2015

Partisan Growth Gaps

New Krugman:

Partisan positioning on the economy is actually quite strange. Republicans talk about economic growth all the time. They attack Democrats for “job-killing” government regulations, they promise great things if elected, they predicate their tax plans on the assumption that growth will soar and raise revenues. Democrats are far more cautious. Yet Mrs. Clinton is completely right about the record: historically, the economy has indeed done better under Democrats.

This contrast raises two big questions. First, why has the economy performed better under Democrats? Second, given that record, why are Republicans so much more inclined than Democrats to boast about their ability to deliver growth?

More here.

Krugman appears to be afraid of going out on a limb in order to explain why the US economy traditionally does better under Democratic presidents, which it definitely does, but, being fearless, I'll try to speculate a little. It's very easy, really, at least in the Reagan as God of Conservatives era: when you believe that government is the problem, and believe it so strongly that the notion infects all your thinking, about everything, you must necessarily forget that, without government, there can be no market.

The government, quite literally, creates the conditions allowing the market to exist. Government MUST NECESSARILY play a role in the economy. It always does, whether you like it or not. But because conservatives hate government so much, they have blinded themselves to this reality. They talk up the wonders of the market, how the market, left to its own devices, will always do the right thing for economic growth, but the liberals with their awful government are always messing that up. Never mind the fact that liberals, real liberals, not the corporate right-centrists who have run the Democratic Party for twenty years, haven't had any real power for decades. The point is that this is an utterly false distinction to make, the government versus the market. The two are symbiotes. And that's just the way it is.

Conservatives will not accept this reality. Non-conservatives do accept this reality. So it's not so much that the Democrats are better on economics as much as it is that the Republicans, in their stubborn self-imposed ignorance, are worse. Far worse. Amazingly worse. They reject a fundamental and key aspect of economics, that the government must necessarily play a role in the economy for better or worse. Consequently, under Republican administrations, this effectively means worse. They simply refuse to accept reality, and will not use government to improve the economy. Democrats will. Thus, Democrats, who have at least one foot in reality, perform better.

This undeserved reputation Republicans have as "good financial stewards" is the biggest con I've ever seen in my life.