Rational Action

This summer I fought in a vicious argument over who would win on November 2. The polls at the time were more or less tied. I predicted that Bush would build a lead over the coming months and ultimately win the election. I reasoned that anyone who bought into Kerry’s foreign policy charges or his cries of economic mismanagement was already voting Blue. With the so-called “transfer of sovereignty” finished, Iraq would fall off the front page of newspapers. Kerry would continue to criticize the administration’s handling of the war, but with public’s perceiving that Iraq was stabilizing, that critique would fall on deaf ears. Likewise, the “jobless recovery” finally seemed to have lost its derogatory adjective: there had been several months of robust payroll employment growth, and with Greenspan indicating he wanted to hike rates, even the experts were claiming that the trend would continue.

As the RNC came to a close, I saw my prediction slowly coming true. The Republicans were running away with the media coverage, making Iraq seem like a another successful Democratic experiment. Payroll employment was up 144,000 in August (from the report released September 3), not enough to increase participation rate, but a sizeable number nevertheless. Media coverage made it seem like a major accomplishment in the recovery.

Then a few unanticipated things happened.

First, Iraq never really faded from the headlines. It returned after the RNC, and the images conflicted with the Republicans’ rosy picture. The 1000th American soldier was killed on September 7, and criticism of the war from within the President’s own party indicated that the security situation was detiorating. It did not help that several major urban areas of Iraq weren’t even under coalition control, shattering the administration’s claims that order had been restored.

The economic news was of no help to Bush, either. When the Current Employment Survey results were released on October 3, payroll employment did not even climb by 100,000 — economists had been expecting gains of roughly 150,000. (For those who think 100,000 jobs is plenty to add in a month, remember that in order to keep (Employment)/(Labor Force) constant, the economy needs to add 150,000 jobs every month.) While this news wasn’t nearly as high-profile as the security situation in Iraq, it left the Bush team with no new information to cheer about, and it allowed Kerry to continue claming that the current administration was the first since Hoover to lose jobs.

These developments in current events occurred along with another factor that I had either not considered or completely discounted in my summer argument: the debates. If you had asked me in August, I probably would have predicted that Bush would blow Kerry out of the water in ability to convince swing voters. In fact, I felt that Bush thoroughly beat Kerry on style in at least the first two debates (I mainly listened to the final debate, and felt like Kerry sounded much better than Bush). However, polls from the first and third debate showed swing voters heavily favoring Kerry, and most polls even gave Kerry a slight lead in the second debate.

As it stands, the numbers have converged and the election is in a virtual tie. Most national polls have Bush up by only a few points, but they said the same thing in 2000, and Gore won the popular vote. The electoral college is a complete tossup. Kerry has hung in there, and time has proven my summer claims incorrect.

Is there a moral to the story?

I’m not sure. For one: please, please, don’t trust my predictions. The truth is that the ups and downs of this election have depended less on the candidates and more on the weather. While Kerry’s debate performance was admirable, he couldn’t have done it without the current events ammunition that was seemingly handed to him by God. Fate has given Kerry good hand after good hand, now let’s see if he can beat my prediction once and for all on November 2.

(P.S. About the current events ammunition: I still haven’t figured out where goose hunting comes into play here.)

After getting sick of poor polling coverage online and on the news, I decided to cut through the spin and make my own electoral vote map. Unlike the establishment media, I’m going to show the real American vote.

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I’ve watched the debates, I’ve read the commentary, and I’ve seen the spin doctors at work. We’re all talking about the election right now, and this election has come down to two fronts: foreign policy and economics.

Just so you know, I’m pretty focused on the latter. So let me give a rough paraphrasing of an interview I saw on CNBC recently. Some financial megapundit was questioning an Economic advisor to John Kerry:

INTERVIEWER: So what exactly is John Kerry’s plan for the economy?

ADVISOR: John Kerry is going to grow the economy. He’s going to support jobs here in America. He’s going to give tax cuts for the middle class while rolling back George Bush’s tax cuts for the wealthiest 1% of Americans. He’s going to make sure every American has health care. John Kerry is going to promote energy independence. John Kerry. John Kerry.

INTERVIEWER: How exactly is John Kerry going to promote job growth?

ADVISOR: Let me say first that John Kerry will create jobs by promoting job creation.* We’re going to close tax loopholes. And we’re going to give companies incentives to make jobs here.

INTERVIEWER: Alright! Moving on to a completely unimportant topic…

* This line more or less ad verbatim

I walked back into my dorm about to cry. The interview made no sense. But oh, so what? Why are you being so emotional, Adam? It’s just job creation!

Forget that the livelihoods of so many Americans rest on good economic policy. I was upset because I wanted more from the candidate that I was — and still am — proud to be voting for. This stupid afternoon interview was symptomatic of the discussion of economics throughout the entire election run.

Dishonest, misleading, opportunistic, nonsensical. That’s the economics of Campaign 2004. We’re not watching real economics. We’re watching talking points covered in economics-colored saran wrap. The statements of the candidates don’t reflect reality; instead they reflect what tests well and what sounds good, irrespective of a positive or negative influence on the country.

You can lie all you want when the swing voters won’t call you on it. The candidates have an incentive to tell economic untruths because these lies damage the opposition in a particularly vicious way: for the opponent, they are for all intents and purposes impossible to rebut. Refuting false statements about economics necessitates an appeal to the more complex concepts of the science. Honestly, who has time to consider the short-term versus long-term stimulative effect of tax cuts of varying degrees of progressivity? The lie sticks.

And so we find ourselves in a situation where each candidate has an incentive to tell as many untruths as the swing voters will believe. If he doesn’t, his opponent will, and by that time it’s too late for any defense — no one’s listening to the response. It’s a prisoners dilemma in which the American people perpetually lose.

Is there anything we can do to heighten the level of Economic debate? I’m not sure. Individually, we start by educating ourselves, but not everyone wants or has time to learn the intricacies of economics. Blogs are certainly helpful in providing both a source of information and a forum for debate, but that won’t help if people continue to have other, more important things on their minds. For the casually interested, then, media coverage is critical. It would help if accountability-inducing media outlets became more prominent; FactCheck.org (not FactCheck.com, Mr. Cheney) is all over this one. It also wouldn’t hurt to have economists more involved in the production of media content, although I’m not sure Paul Krugman should be the one doing the reporting.

I’m don’t know where I fit in here. I’d like to do a series of posts about the economic issues of Campaign 2004, but even I don’t trust myself to report about Economics. On the other hand, this post deserves a follow-up. Let’s see if I can’t put together a list of common Bush and Kerry economic untruths. Feel free to respond to this post with a few, and maybe I will discuss them.

If you find errors, poor logic, or lapses of judgement in anything I say, please point them out. In writing all of this, I wouldn’t mind correcting any faults in my own understanding.

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