David Leonhardt in NYT:
The reasons for the stimulus’s middling popularity aren’t a mystery. The unemployment rate remains near 10 percent, and many families are struggling. Saying that things could have been even worse doesn’t exactly inspire. Liberals don’t like the stimulus because they wish it were bigger. Republicans don’t like it because it’s a Democratic program. The Obama administration hurt the bill’s popularity by making too rosy an economic forecast upon taking office.
Moreover, the introduction of the most visible parts of the program — spending on roads, buildings and the like — has been a bit sluggish. Aid to states, unemployment benefits and some tax provisions have been more successful and account for far more of the bill. But their successes are not obvious.
Even if the conventional wisdom is understandable, however, it has consequences. Because the economy is still a long way from being healthy, members of Congress are now debating another, smaller stimulus bill. (They’re calling it a “jobs bill,” seeing stimulus as a dirty word.) The logical thing to do would be to examine what worked and what didn’t in last year’s bill.
But that’s not what is happening. Instead, the debate is largely disconnected from the huge stimulus experiment we just ran. Why? As Senator Scott Brown of Massachusetts, the newest member of Congress, said, in a nice summary of the misperceptions, the stimulus might have saved some jobs, but it “didn’t create one new job.”
The case against the stimulus revolves around the idea that the economy would be no worse off without it. As a Wall Street Journal opinion piece put it last year, “The resilience of the private sector following the fall 2008 panic — not the fiscal stimulus program — deserves the lion’s share of the credit for the impressive growth improvement.” In a touch of unintended irony, two of article’s three authors were listed as working at a research institution named for Herbert Hoover.
If Leonhardt intends to knock down a straw-man argument — ARRA has had no impact and the economy would be in the same shape without any fiscal stimulus program — he succeeds. But of course economists like Michael Boskin, who is also affiliated with Hoover, argued that there were cheaper alternatives that would yield better overall employment outcomes. Boskin could be wrong. Yet his argument is one that deserves to be taken seriously. Note that Boskin’s argument does not “revolve around the idea that the economy would be no worse off without” the stimulus. Rather, he suggests that it had less impact than the business cycle, the Fed’s zero interest rate policy, and the automatic stabilizers in the tax code. That there is an important different between this argument and the argument that the economy would be no worse off without the stimulus should be obvious.
As Jeffrey Sachs — an economist at Columbia University’s Earth Institute, which is not named after Herbert Hoover — has argued, the U.S. has engaged in extreme policy swings on the fiscal and monetary side for much of the last two decades, and the consequences have been dire. There is a value in crafting sustainable policies that might not have the same short-term impact, but that are likely to yield better outcomes over the long term.
Jonathan Chait at TNR:
It’s bizarre that Reihan portrays this as as a straw man argument, since it’s indisputably a very-widely held opinion among Republicans and conservatives, and I’d argue represents the consensus GOP view. When new party poster boy Scott Brown asserted that the stimulus “didn’t create one new job,” he was simply parroting a line that has been circulating among his party for a year. Which other conservatives have said this, you ask? Which ones haven’t?
There’s John Boehner (“the stimulus isn’t creating jobs for American workers.”) The Washington Times editorial page (“Mr. Obama’s policies delayed the recovery.”) Andrew Wilson at the American Spectator (“It is a $787 billion shell game — taking money out of the private sector and putting it to less productive use in the public sector or passing it around as hand-outs to politically favored Democratic Party constituents. In doing so, the “stimulus” has actually destroyed jobs.”)
How about some examples closer to home? Here’s National Review’s Mark Steyn: (“It didn’t just fail to stimulate, it actively deterred stimulation, because it was the first explicit signal to America and the world that the Democrats’ political priorities overrode everything else.”) Here’s Brian Riedl, also in National Review. (“The stimulus is not failing because it is too small or because too much of it is being saved. It’s failing because Congress can only redistribute existing demand, not create new demand.”) With more time I could go on and on.
Reihan, a former TNR Reporter-Researcher, is a bright and terrific guy, but he has an unfortunate tendency to imagine that the Republican Party is filled with people who think like he does. It isn’t.
Jon Chait zings Reihan Salam for what is I think a pretty common failing among the smarter set of conservative commentators, namely a tendency to dismiss as straw-man characterizations positions that are in fact the mainstream conservative orthodoxy. In this case that includes the assertion that the American Recovery and Reinvestment Act has had no positive impact on the economy. You see something similar with the view that climate change is a made-up conspiracy cooked out of thin air by Al Gore and some UN guys. Or that reducing tax rates is a surefire way to increase revenue.
I wish it were the case that these were straw man views, invented by liberals to make the right-wing look bad. But if you listen to what the most powerful conservative politicians and media figure in the land say, these are the things they offer as the basis of conservative policy on macroeconomic stabilization, on climate and energy, and on the long-term fiscal challenge. Is it nuts? Well, yes it is. But there you have it. If you want to find what counts as a fringe position, you can find tea party leader Richard Mack talking about states’ rights to secession.
And here is where I am inclined to be soft on Reihan Salam. Because his declarations that “ARRA has had no impact and the economy would be in the same shape without any fiscal stimulus program” is “a straw-man argument…” and that “I don’t thing that anyone doubts that ARRA helped perk up growth. It is very hard to imagine that spending an enormous sum of money would not…” is a double-headed axe. Reihan wants David Leonhardt to acknowledge the stronger anti-stimulus arguments–that what we have bought we have bought at too dear a long-run price. But Reihan is also trying to marginalize the mendacious and the ignorant: the Veronique de Rugys, the Conn Carrolls, the Brian Reidls, and their ilk. Call their arguments straw-man arguments and those arguments’ advocates become straw men.
The problem is that it is not going to work: because Reihan Salam is marginal on the American right he cannot marginalize the right’s mainstream, at least not without a lot of help from a lot of people who are still hiding at the bottom of their foxholes and refuse to come out to try to rescue their party.
Reihan claims that Leonhardt is arguing with a strawman, but as both Jon Chait and Matt Yglesias point out, there really are lots of conservatives — including most of the loudest ones — who believe that the stimulus literally had no impact on jobs or growth — or maybe even a negative one. It’s hardly a stretch to say that this is a pretty widely held right-wing view, and Matt draws a broad conclusion from Reihan’s reluctance to acknowledge this: “I think [this is] a pretty common failing among the smarter set of conservative commentators, namely a tendency to dismiss as straw-man characterizations positions that are in fact the mainstream conservative orthodoxy.”
Well, yes. I’m reminded of Megan McArdle’s revelation a couple of years ago when she discovered that mainstream conservatives really do have a party line that insists tax cuts always raise revenues. “A conservative publication,” she admitted, “just spiked a book review because I said that the Laffer Curve didn’t apply at American levels of taxation….I suppose I ought to have known, but I didn’t. Go ahead liberals, pile on: you told me so.”
But I think there’s something else going on here too. In his post about the stimulus bill, Reihan is implicitly suggesting that liberals ought to be engaging with the best of conservative thinkers, many of whom hold nuanced and moderate positions. And it’s true: some of them do. The problem is that in the real world, these nuanced and moderate thinkers have virtually no influence. Among actual politicians and high-profile yakkers, it’s nearly unanimously held that, for example, the stimulus had no positive effect on the economy; that tax cuts always increase revenues; that Europeans all have poorer healthcare than Americans; and that man-made global warming is a delusion. Reihan and Megan and others like them may hold more careful views, but the vast bulk of the conservative movement simply doesn’t. And that’s the reality of the world that liberals have to deal with.
Reihan Salam again:
Here’s a hot tip: Powerful people like engaging these arguments because doing so allows them to avoid more difficult questions — was the ARRA cost-effective, and was Alice Rivlin right to suggest that it was too hastily drawn up and that it ought to have separated a narrow recession-fighting package focused on aid to states and extension of unemployment benefits from a sustainable infrastructure package designed to meet long-term economic priorities? Is a cap-and-trade system that includes large subsidies and credits for abatements going to work terribly well, or will it enrich a handful of corporate constituencies while making more effective alternatives less likely? And are there ways to reform our welfare state that can better address the economic anxiety experienced by the large number of workers in tradeable sectors, a category that, as Alan Blinder has argued, has expanded over the last few decades and will continue to expand in the decades to come?
The beauty of engaging over-the-top, hyperbolic arguments is that it allows you to advance half-baked ideas. Were you to engage serious, nuanced arguments, you might discover that the policies you’ve been advancing don’t meet their stated goals very well.
Rooting for a professional sports team is a gas. But rooting for a team of professional politicians is, for the pundit class, even more fun — in a sense, you can participate in the fun by maligning your political “enemies.” Imagine if it were socially acceptable for fans of the New Orleans Saints to throw Nerf balls at Peyton Manning during the Super Bowl. Sure, it’s not going to stop the guy. But it would prove very distracting. And for the Nerf ball throwers, it would also feel very, very empowering. What a way to unleash lots of pent-up energy!
Here’s the thing: I don’t think that rooting for a team of professional politicians is very edifying or very worthwhile. What I do think is important is holding powerful people accountable, whether they’re in the Bush White House or in the Obama White House or in corporate boardrooms or NEA headquarters.
So when I suggest that David Leonhardt — a tremendously smart guy — is wasting his time taking on straw man arguments, the fact that John Boehner is serving up anti-stimulus zingers is not much of a gotcha.
I’m sensitive to this in part because I remember when pro-war conservatives spent huge amounts of time taking on the notion that President Bush wanted to invade Iraq to seize its oil wealth, to expand America’s empire, or to serve Israeli interests. It was a lot of fun to tackle these arguments because they made critics of the Iraq War look like kooky conspiracy theorists. And some of them — very large numbers of them, perhaps — were kooky conspiracy theorists! But I wish that we in the pro-war camp had spent more time thinking about and not dismissing arguments about the opportunity costs of a prolonged military occupation of Iraq or the dangers posed by Iraq’s ethno-sectarian divides.
This isn’t to say that John Boehner is making the equivalent of a “blood-for-oil” argument. I don’t know if there are any meaningful equivalents when you’re talking about a federal stimulus bill that, unlike a war, is not as vividly a matter of life and death. What I’m saying is that those of us on the right did ourselves a disservice by not tackling the toughest, most challenging arguments. Instead, we chose to focus on scoring political points. And to what end?
Jonathan Chait at TNR responds:
I’m surprised that such a smart guy does not understand the definition of a straw man argument. A straw man argument is not simply a ridiculous belief. A straw man is when you set up, in opposition to your own beliefs, a caricatured argument that no serious person advocates. A ridiculous argument that has numerous, influential advocates is not a straw man.
I don’t think it’s worth David Leonhardt’s time, or mine, to refute myths promoted by obscure cranks. It is worth our time to refute ridiculous beliefs that are widespread, highly influential and advocated by powerful people. I also think it would be extremely useful if those conservatives who understand how ridiculous these ideas are would use their position of influence within the movement to refute these ridiculous ideas rather than deny their existence. I understand the difficulty of Reihan’s position and why he has very good reasons not to do so. But we should be clear that it’s not David Leonhardt or me that’s allowing his writing to be driven by partisan loyalties.
I think that Chait misunderstands my objectives. When Republicans are in power, I criticize Republicans. When Democrats are in power, I criticize Democrats. Had Chait excerpted different parts of my post, that point would come across (I stated this explicitly), but we approach these arguments in a different way, and I respect that. It’s not at all clear to me that Chait understands the difficulty of my position: I don’t think my position is very difficult at all. Criticizing John Boehner is, in my view, frankly less important than criticizing Nancy Pelosi when Nancy Pelosi commands a large congressional majority. That said, I’ve also written several columns for The Daily Beast recommending that the White House and congressional Democrats pursue a more partisan legislative strategy. The DSCC issued a press release citing a Forbes.com column I wrote on Charlie Crist. I’ve praised Greg Anrig’s call for federalizing Medicaid. I’ve favorably cited arguments made by Jane Hamsher and Chris Hayes. I’ve criticized Republicans for not backing the excise tax. I’ve advocated a VAT to help balance the budget. I’ve … you get the picture.
Chait very generously characterizes me as smart, which is why he doesn’t understand why I can’t grasp his argument. If being smart means understanding that running a 10 percent deficit is the best of various bad options or that Alice Rivlin is wrongheaded for believing that the stimulus package was poorly designed or that the case against the stimulus bill and the case advanced by congressional Republicans against the stimulus bill are identical, I obviously don’t deserve to be called smart. And I’m okay with that! I almost flunked out of high school, and as far as I’m concerned there are more important things in life than being smart, like being judicious, open-minded, and independent.