Voters hold officials accountable for deficits in many countries. Just not here.
Adi Brender (Bank of Israel) and Allan Drazen (University of Maryland) crunched data from 23 nations on budgets and the electoral fortunes of chief executives. Their unambiguous finding was that “increased deficits during an incumbent’s term in office, especially in election years, reduce the probability that a leader is re-elected.” In what must be music to fiscal conservatives’ ears, the economists’ write, “Reducing deficits is not an electoral loser.”
Their analysis runs contrary to much of what we know about voters. Suzanne Mettler‘s book The Submerged State (2011), for example, depicts how voters are happy to accept more government help, then forget that the government is providing it, and balk at increasing taxes—or the removal of existing benefits. (“Keep your government hands off my Medicare!”)
And politicians frequently behave as if voters are happy to be bought off with government largesse. The Brookings Institution’s John Hudak wrote a book, Presidential Pork (2014) that shows how presidents spread federal largesse around in election years. A new grant here, a new bit of infrastructure there—fiscal pork is dropped where it is thought most likely to swing voters, who care more about getting something than the total budget picture. Not too long ago, congressmen also did this, frequently with abandon. Studies like Morris Fiorina‘s “Congress: Keystone of the Washington Establishment” (1977) explained how legislators tried to up their election odds by sending a steady stream of benefits to interest groups and constituents at a collective cost to the nation.
Yet, it is plain to the eye that voters are not endlessly voracious greed-heads. The word “deficit” is an undeniably pejorative term. Sure, folks can be persuaded that priming the pump during an economic downturn through federal spending is wise. But otherwise, the very idea of spending more than one takes in is not a political winner. And has any aspiring legislator ever campaigned on the promise to grow the deficit and debt?
Which brings us back to Brender and Drazen’s article. They write, voters’ “dislike of deficits holds in both election years and during the rest of the term.” Their conclusion is supported by robust methodological rigor.
So what’s the bad news? Well, unfortunately, it appears U.S. voters are exceptions to the rule. With few interruptions, budget deficits climbed between 1960 and 2003, the period of the paper’s analysis. But during this period most sitting American presidents were also re-elected—comfortably. LBJ was re-elected after taking over for John F. Kennedy; Richard Nixon, Ronald Reagan, Bill Clinton, George W. Bush, and Barack Obama all were two-termers. And Gerald Ford’s ouster was no wonder—he was Nixon’s vice president and pardoned him. That leaves Jimmy Carter and George H.W. Bush as the only presidents who failed to win a second term. Did voters punish them for deficits? Maybe—but “Poppy” Bush raised taxes to reduce the deficit.
Of the whole bunch of presidents since 1960, only Clinton could brag that he lowered deficits and even got America to a surplus. If American voters hate deficits, then presidents don’t much suffer as a consequence.
The deeper question, of course, is why Americans are unusual on this count?
One possibility is that U.S. voters cannot comfortably place much blame on presidents for fiscal performance.
In support of this hypothesis, I’d point to table 7 of the Brender-Drazen paper. It shows that the U.S. is the only one of the 23 nations examined that does not have a parliamentary or proportional system, both of which more clearly assign a party to be “in charge” than the U.S.’s political system. Indeed, for the past 50 years, U.S. voters were happy to split control of the government: a Republican might be president, but Democrats ran Congress, or vice versa. (That Republicans today are so desperate to make something good of the Trump presidency is evidence of this—unified government is occasional and fleeting.) Divided government means neither party can credibly claim responsibility for the state of the budget.
There also is the complex nature of our budget process, which obscures reality and responsibility. The president’s budget, which many voters may mistake as the actual budget, inevitably is filled with wishful thinking. So, too, is Congress’s budget resolution, which promises balanced budgets within the foreseeable future. Appropriations acts come some time after the president’s budget and the budget resolution, and more often than not arrive balled up as omnibuses, continuing resolutions or “cromnibuses” agreed to when the choice is government shutdown or business-as-usual. The latter likely is more attractive to most voters, as government shutdowns look like governance failures—the product of toxic partisanship.
And, it is worth adding, the federal budget process tends to be settled by early October, long before the mid-November elections, which lowers the salience of the budget in voters’ minds.
All of which prompts two uncomfortable questions: Are there aspects of our governmental institutions that fail to translate voters’ preferences into policy? Or, are American voters simply all talk when it comes to budgeting?
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