The recent announcements that the economy grew an astonishing 7.2 percent in the 3rd quarter while adding 126,000 jobs in October are necessitating a change in strategy by Democrats. Up until now, their mantra has been that Republicans gave us the worst economy since the Great Depression, or whatever their hyperbole of the day is. But with growth restored, jobs rising and the likelihood that this trend will continue through the election, Democrats have to find something else to complain about.
I believe that they will quickly turn their full attention to the budget deficit. They have had to be restrained about this up until now, trying to finesse the issue by attacking long-term deficits, while approving short-term deficits due to the slow economy. However, they have gotten nowhere with this bifurcated strategy because it simply doesn't resonate with ordinary people. To those who think deficits are bad, all deficits are bad. Saying that some are bad and others are good just confuses the issue politically.
But with growth and jobs returning, Democrats can unify their message. Now they can say that deficits are the root of all evil, because they are no longer needed to tide us over an economic downturn.
A key piece of ammunition for Democrats seeking to make deficits the key economic policy issue in next year's presidential campaign is the new book by former Clinton Treasury Secretary Robert Rubin, In an Uncertain World (Random House). In an excerpt published in the Financial Times on Monday, Rubin gives the 1993 budget deal primary credit for the 1990s economic boom.
Says Rubin, "The view over the next few years that fiscal discipline was being restored contributed to lower interest rates and increased confidence, and that led to more spending and investment, which in turn led to job creation, lower unemployment rates and increased productivity."
In coming months, we can expect to hear Democrats and their mouthpieces in the media repeat this message over and over again. The economic expansion cannot continue, they will argue, unless deficits are reduced sharply. This will give them a much more politically palatable way of attacking Republican tax cuts than by calling them a give-away to the rich, which is all they have had to say for the last several years. Now, raising taxes can be portrayed as fiscal responsibility instead of class warfare.
Bruce Bartlett is a former senior fellow with the National Center for Policy Analysis of Dallas, Texas. Bartlett is a prolific author, having published over 900 articles in national publications, and prominent magazines and published four books, including Reaganomics: Supply-Side Economics in Action.
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