Is It Really About “Dysfunctional” Partisanship? New Economic Perspectives

This is a syndicated repost courtesy of New Economic Perspectives. To view original, click here.

The popular narrative in Washington, DC these days among the MSM pundits is that the Congress is “dysfunctional” in the sense that it is very difficult for it to pass a budget and rise above periodic “fiscal” “debt” and “deficit” crises. This difficulty is attributed to the failure of our representatives to rise above their party interests and to accept compromises proposed by “adults” such as the President, which would, it’s claimed, resolve our long term “fiscal sustainability”/”fiscal responsibility” problem through a “balanced” long-term $4 Trillion deficit reduction plan.

It’s also said that our representatives can’t rise above those party interests because of extreme partisanship exacerbated by gerrymandering of Congressional Districts so that most are now one party districts, in which only strong partisans embodying the extremes of each party can win primaries and then get elected. I think this story is wrong, or at least, very superficial. Here are some of the reasons why.

First, it’s clear that part of the reason for the dysfunction we see is the existence of the filibuster and various procedures related to it, that now prevent the Senate from passing legislation unless 60 Senators will support a cloture vote. In itself, the maintenance of this rule has nothing to do with partisan commitments and much more to do with the individual wish of every Senator to be able to block legislation they are opposed to. 

The power to say no, is a very important one for each Senator, allowing them to get special concessions when their vote is needed to get legislation through. Senators fear being in the minority and not having the power to say no. When they are in the majority they worry that some day, perhaps soon, they will be in the minority, and will need that ability to say no to extract concessions. They also worry that removal of the filibuster, would give campaign contributors much less reason to donate to the campaigns of individual Senators and even more reason then they have now to focus donations on Congressional leaders.

This desire to protect their own privilege has trumped party interests in the Senate for a long time. The Senate’s inability to pass a large enough stimulus was due to the need for 60 votes to get a cloture vote on the legislation. The Administration believed that a stimulus bill of $1.2 to $1.8 Trillion just couldn’t be passed and that it needed one that was less than $1 Trillion in size. It had advice that the bill should be much larger from economists in the Administration and vocal and influential economists outside; but the perceived political imperative imposed by the 60 vote rule was to much to get by.

In health care reform, the situation was similar. The need for 60 votes required a health care bill that would be more solicitous of the health insurance industry. Republicans and some key Democrats were in the pocket of the industry. Their influence would have been much less if only 50 + 1 (the VP) votes were needed to pass a bill. But, as it was, Democrats like Ben Nelson, Joe Lieberman, Evan Bayh, and Max Baucus had an inordinate amount of influence on the legislation eventually passed.

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In the House, there was no similar problem in getting legislation through. Nancy Pelosi would have been able to deliver Democratic votes for most anything the Administration decided to pursue, other than straight up coverage of abortion. And, on the stimulus front, a much larger one, much more heavily weighted toward spending, rather than tax cuts, could easily have been passed if the Administration had proposed one.

Second, another reason why Washington is so “dysfunctional” is because of the role of big money in campaign financing. Large corporate contributors, including banks, oil and energy companies, the pharmaceutical industry, the health insurance industry, wealthy individuals, some well-funded voluntary associations, like the Chamber of Commerce and the NRA want either to block legislation regulating their interests, or to write legislation giving them subsidies or tax cuts. So, they block or subvert public outcries for real reform to serve themselves. Because of their campaign contributions to key House Members and many, many, Senators and the opportunities the officeholders they’ve bought have to delay and block legislation in both Houses, but especially in the Senate, it is always difficult to get new legislation passed that hurts the these interests and benefits broader constituencies. 

Third, partisanship isn’t by itself enough to create dysfunction. It’s also necessary to have different parties in control of each House of Congress. If the Democrats hadn’t lost the election of 2010 decisively across the country, at every level of government, due to unhappiness over the continuing recession, and the failure of the stimulus to end it, disapproval of the Affordable Care Act, and the sense of widespread injustice associated with bailing out the banks, but not the people, then both the House and the Senate would have been in control of the Democrats in 2011 and 2012. The gerrymandering we saw in 2011, which preserved the Republican majority in the House for the present term would not have occurred, and the deadlock in Congress with its “shock doctrine” applied to the budget process would never have occurred. Excessive partisanship didn’t cause the Democrats’ defeat in 2010. Rather it was their poor performance in 2009 and 2010 that made the voters want to either punish them or stay home that led to that defeat.

Which brings us to my fourth reason for doubting the view that extreme partisanship is in back of the “dysfunction” we are seeing. And that is that partisanship can sometimes create effective government, where lesser degrees of partisanship are ineffective. What are the elements of partisanship?

Well, ideology, is certainly one, and no doubt many of the Republicans are more strongly committed to a right-wing form of randian libertarianism, than any comparable proportion of Democrats are to any coherent ideology. Nearly all Republicans are really ideological on the issue of raising taxes, while the majority of Democrats resist the idea that entitlement spending ought to be cut.

But, it’s also true that many Republican officeholders are fairly non-ideological, as well. In addition, all Democrats and Republicans these days seem to adhere to an overall neoliberal philosophy with its faith in free markets, and commitment to limit regulation of markets. Democrats, of course, are less committed to these things. But looked at objectively, the differences are a matter of degree, and I doubt that they account for the deadlocks we are seeing.

Another element of partisanship is party discipline. Here Republicans seem to be more disciplined than Democrats in delivering votes for their leaders, though members of both parties seem more likely to line up behind leadership than they were, say, from the 1970s, until Newt Gingrich took over the House Republicans in the 1990s.

Now, however, we come to the third and really decisive element of partisanship. That element is the sheer desire of party members to do whatever is likely to win elections. If extreme partisanship, in the sense of wanting one’s party to win were really the explanation for dysfunction in the Government, then why don’t the party members in Congress unite behind actions that are sure to get them elected?

Look at the Republicans, they refuse to do things in Congress that would reduce the hold the Democrats have on hispanic voters. They do things all the time that are opposed to the interests of the seniors who now provide them with majority support in their demographic, and if they succeed in cutting Social Security and Medicare, why would their senior constituency vote for them again? Yes, I know they’ll try to blame the Democrats for such cuts, and perhaps they’ll partly succeed; but isn’t it easier for them, if they really want to win above all, to just not risk earning the enmity of their older constituents by striking at their vital interests? 

And what about women? The Republicans seem to have a compulsion to propose and pass legislation that will clearly have the effect of hurting women. And they exercise that compulsion in most states where they have control of the legislature, and again and again in the US House. And members of their party continuously speak about women in clearly unacceptable ways, while stating their support for hostile legislation. It’s like a nervous tic with them. They can’t even speak respectfully while they’re moving to pass their negative legislation, but must offer offensive homilies while they’re passing ridiculously oppressive legislation. 

And then there’s the African American vote.  Across the country, Republicans are trying to disenfranchise blacks and hispanics. In addition to having policies opposed to the economic interests of many black voters; they’re trying to make second class citizens of them and other minorities. Are they trying to drive the Democrats percentage of the Black vote from between 90 to 95% to nearly 100%? Are they trying to drive the hispanic support of Democrats up to 85%? Is there a demographic group in the nation that the Republicans will avoid ticking off? 

And what about their primary nominations. The Republicans are into nominating people for the Senate who can’t possibly win general elections. We’ve seen this pattern in both 2010 and 2012. They could have won the Senate in both elections if they’d nominated people who were remotely acceptable to anyone but Republicans. As for the House, they can win there now, but only because of the gerrymandering after the Democrats gave away the 2010 elections.

Which brings us back to the Democrats. Look at that vaunted “progressive” partisan politician Nancy Pelosi do in 2009 – 2010. She followed her leader, President Obama, down the line in whatever he wanted to do, and her troops followed her, regardless of the consequences for their party.

She must have known that the stimulus bill, the ACA, the Credit Card Reform Act, and the Finreg legislation (Dodd-Frank) were all dogs. So why support the compromises? Didn’t she know by the Summer of 2009 that her majority would be threatened by the ineffective stimulus and exceedingly complex and easily demonized ACA bills she had passed or was in the process of passing? Couldn’t she gauge the reactions of people across the country to “too big to fail”? Didn’t she see the outrage over the bonuses? If she really cared so much for the well-being of her party, then why didn’t she pass a second stimulus during the Summer of 2009 and challenge the President and the Senate to follow along? Why didn’t she pass the Conyers-Kucinich HR 676 Medicare for All Bill in early 2009 and then let the Senate and the Administration work on that? It wouldn’t have passed as is, but she would have headed off the tea party by doing that, and the final health care reform bill would have been a much better one than the ACA.

If partisanship is really the dominant factor in the dysfunctionality of Washington, then why hasn’t Harry Reid acted like the strong partisan he’s supposed to be by getting rid of the filibuster on the first day of the 2009, 2011, or 2013 Senate sessions or on any day in between or since? Had he done that, then the Democrats would have had their way with the Republicans for the last four years and for the present session as well. Instead, he makes informal deals with the Republicans which they instantly break, and still he hesitates to take the power which the majority is entitled to in the Senate. Some partisan he is! He’s the most non-partisan partisan in Senate history!

Finally, if partisanship is really such an important factor in dysfunction, then why is it that the Democrats are letting themselves get set up again for a stinging defeat in the 2014 election. At some level, everyone in Washington, including the Democrats knows at this point that cutting deficit spending will surely cost jobs and harm the economy. Nor can they easily predict the amount of harm that will result. The cuts being produced by the continuing budgetary crises are likely to kick the economy into another recession, absent another credit bubble, and this will be a disaster for Democrats. 

President Obama is done with elections. If he gets his “grand bargain,” then he can and probably will crow about his legacy. But the Democrats in Congress will be left to pick up the pieces. They will, of course, blame the Republicans. But with Obama supporting the “Grand Bargain,” and the Democratic Leadership going along with their President because they’re “the adults” in Washington, Democratic candidates won’t be able to run against the recession and say the GB was a mistake. They will try to defend the GB, as will many Republicans. But that means that the voters, in their misery, will respond with “a plague on both your houses” and stay home.

But we know what happens when people stay home in mid-term elections after Democrats have gone against the perceived interests of their constituents. More Democrats lose their intensity and stay home than Republicans, and the result is Republican victory. The “Grand Bargain” (the Grand Betrayal, if you like) will result in Democratic defeat in the House in 2014, and probably a defeat for them in the Senate as well unless the Republicans throw victory away again, by nominating yet more ridiculous candidates to run against vulnerable Democrats. If that happens you will then see real dysfunction in Washington as the Republicans make an all out attempt to gut the social safety net, while the budget crisis politics intensifies in the lat two years of the President’s term in office.

So, I don’t agree that the problem in Washington is excessive partisanship and that what we need is some more “adults in the room.” I think the problem is too little party identification by Democrats, and too little willingness to insist on the priorities of Democratic voters. From a political point of view Democrats must not agree to any “compromise” that will cast them as being responsible for spending cuts to core Democratic programs. They must choose government shutdown before that. They must be seen as defending core programs of the people they represent; and they must wait for the Republicans to break under the pressure of being charged with shutting down the Government rather than getting new revenues from the wealthy to avoid cutting Medicare and Social Security. 

For the Democrats, trading cuts in defense for entitlement cuts is a bad trade. They should never agree to that. If the Republicans want their defense spending, then they should be forced to agree to deficit spending, or to higher taxes on the wealthy.

From my point of view it’s better for the economy if the Republicans get off the deficit hawk kick and agree to fund defense spending through deficits. Then the Democrats should back off running on “fiscal responsibility” in 2014 and let the Republicans off the hook for their deficit spending on defense, while pushing for more deficit spending on jobs programs. Whatever Democrats do, however, if they want to win in 2014, they must not agree to any “Grand Betrayal” that is neither in the interest of their party; nor most of the country.

Here are the realistic choices coming up, absent a “big move” by the President to change the political backdrop of fiscal policy.

– The Government could be shut down awaiting the Republicans to back off their spending cut stance;

– The Republicans and Democrats could agree on some compromise involving increased revenue and decreased Government spending including entitlement spending, using a 3 – 1 ratio;

– Both parties could back off the sequester cuts, and the Republicans could back off the upcoming continuing resolution and debt ceiling crises.

The third of these choices is the best of the three for the economy, the country and the Democratic Party. To get there however, the Democrats in the Senate will have to refuse to agree to the Grand Betrayal, and no doubt will have to endure a Government shutdown over the debt ceiling. Unless they do that, the election of 2014 will be a Republican victory.

Just above, I mentioned a “big move” by the President. That move, of course, is using  High Value Platinum Coin Seigniorage (HVPCS), to provide enough reserves in the Treasury’s spending account to pay off “the national debt” as it falls due, and to avoid issuing new debt for at least 15 – 25 years. The President has so far resisted doing that. But if he were to use HVPCS, he could take future debt ceiling crises off the table, and also remove any plausible rationale based on deficits/debts for any further spending cuts at this time. The normal rationale for tax increases, that “the Government needs the money” would also be gone.

So, politics in Washington would shift away from discussion of deficit spending and debts and towards the kinds of policies that would be good for America in both the short and long runs. That kind of change would increase the chances for Democratic Party victory in 2010, and would also be the beginning of a decent legacy for the President. It would also be far better for the United States than austerity politics has been. So, in this case, partisanship, in the form of a change in the fiscal foundations of the United States, which surely favors the Democrats, would also be what is best for the country. So much for the dysfunction of “partisanship”!

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