In its lead editorial, The Economist reported this week that “politicians have failed to be honest with voters. […] neither Mr. Obama nor the Republican leaders have been brave enough to tell Americans what it will really take to fix the fiscal mess. Democrats pretend that no changes are necessary to Medicare or Social Security. Republican solutions always involve unspecified spending cuts, and they regard any tax rise as socialism. Each side prefers to denounce the other, reinforcing the very polarization that is preventing progress.” This quote suggests that the fiscal cliff says a bit about both American politics and political psychology.
What the fiscal cliff shows about politics
Democracy is often seen as an efficient means of aggregating political preferences: by electing a small number of officials to act on behalf of the whole population, this small cadre of leaders is capable of learning more about issues, debating those issues in depth, and arriving at policies that are broadly politically palatable and in some way “better” than the policies that might have been created by the politically naïve masses.
Yet the fiscal cliff is a prime example of political leaders shirking their responsibilities – i.e., failing to debate and make enlightened policies – and taking advantage of our psychological predispositions toward partisan attachment for their own gain. Citizens are natural partisans; we trust our party’s politicians more than those of the other party and we tend to believe the narratives they provide about what is happening in Washington. Rather than work together to resolve the fundamental problem at hand – massive government spending that has far exceeded revenue for all but a handful of years over the past three decades – our leaders in Washington have played on the public’s partisanship to each blame the opposing party for failing to take leadership.
Unfortunately for the American people, the policies needed to resolve the country’s massive debt crisis were not on the table in debates surrounding the fiscal cliff. The White House and leaders on Capitol Hill blamed each other for pushing the country over the precipice, yet took little responsibility for either the spending and revenue policies that created the national debt nor for the 2011 deal they approved which wrote the fiscal cliff into law.
In negotiations for their fiscal cliff, Republican and Democratic leaders offered their boilerplate policy solutions: for Republicans, unspecified spending cuts (except that no cuts will be made to Social Security, Medicare, or Defense) with no increases in tax revenue, and for Democrats, tax increases for the wealthy with no significant cuts to social programs. Yet, the unfortunate reality of the national debt is that obtaining a balanced budget requires dramatic cuts to all areas of federal expenditure, especially those with large budgets (namely, Medicare, Social Security, and defense) in addition to significant tax increases and elimination of credits, deductions, and the like.
We must pay more for less in order to balance the budget, and we must pay significantly more and spend significantly less in order to actually pay down the debt (which requires not merely a balanced budget, but one that is revenue positive).
What the fiscal cliff shows about political psychology
Years of hearing the arguments made by ineffectual politicians that spending should not be cut and taxes should not be increased has left the American public with a puzzling combination of policy preferences that favor increased spending (or at least disfavor spending cuts) and favor decreased taxes (or at least no tax increases). Decades of repeated argumentation from Democratic and Republican leaders pervading the public consciousness means that majorities of Americans favor increased spending paid for with decreased tax revenues. We have been misled by the leaders we send to Washington into believing precisely the opposite of what is reasonable policy. Washington has failed us.
There is a degree of optimism, however, in the news of a fiscal cliff deal. The bill “resolving” the fiscal cliff debacle – the American Taxpayer Relief Act of 2012 - is the best-worst solution: it saves Americans from substantial tax increases but asks the 113th Congress (sworn into office on January 3rd) to deal with the core fiscal problem instead, and not without adding a few servings of pork to lobbyists. With all these problems, the bill appears to have not passed muster with the American people.
Nationally, only 43% of Americans approved of the fiscal cliff agreement. (This number might be lower if the 12% reporting “no opinion” were probed for a positive or negative view.) Like so much in contemporary American politics, however, these views are polarized across party lines: two-thirds of Democrats seem to have a favorable view of the deal and equal numbers of Republicans have an unfavorable view. A cynic might ask why anyone has a favorable view of legislation that does not solve the problem it explicitly aims to address, despite that problem having been quite literally created by the exact same pool of politicians.
But, of course, something is better than nothing. Throughout December, polling numbers suggested that 60%-70% of the public wanted to see political compromise surrounding the fiscal cliff but as negotiations proceeded through the holiday season skepticism that a deal would be reached was high (half of the public thought a deal unlikely, and they were most likely pleasantly surprised to learn that most of their taxes would not suddenly and substantially increase).
Yet, as this blog has reported previously, partisans sometimes admit some positivity toward political compromise, but in practice they punish politicians who actually work in a bipartisan fashion. Should we therefore be surprised that Washington hardly compromised, preferring to shirk responsibility rather than go against partisan principles? Probably not, but it is still disappointing that each of our attachments to our own political party has led to us to continue to vote for and support that party’s leaders – people who consciously, blatantly, and repeatedly fail at their jobs of solving the federal government’s problems. We may not view Washington particularly favorably as a whole (only about 18% of Americans have a positive view of Congress), yet our partisan attachments misguide us into supporting our parties even when they’re part of (or the entirety of) the problem.