Next week the midterm election will determine whether the Democratic Party maintains its tenuous hold of Congress, or the Republican Party takes over. Polls indicate that there’s a better than even chance that the Republicans will take over both bodies of Congress. And if you listen to the “person on the street” interviews on major news outlets, it will be because a huge number of voters consider “the economy” the largest single issue influencing their vote.
If voters opt for Republicans on the assumption that that party is better able to tackle economic challenges, they will have fallen for the second biggest lie in American politics.
The Big Lie – the election was stolen
The biggest lie in American politics is, of course, that the 2020 presidential election was “stolen” from Donald Trump due to massive voter fraud orchestrated by the Democratic Party and its supporters. That the Democrats, who the Republicans argue are incapable of running anything more complex than a lemonade stand, somehow coordinated the corruption of election systems and processes across multiple jurisdictions, under both Republican and Democratic oversight, without leaving one shred of evidence of their nefarious scheme. No matter that investigations run by Republican administrations in key states determined that no such fraud took place, or that courts threw out 61 of 62 cases challenging the presidential election (the sole “victory” in court involved a time limit on the provision of identification, and affected a handful of votes in a state that Biden had won by over 81,000 votes).
The Second-biggest Lie – Republicans are better for the economy
The second biggest lie in American politics is that the Republican Party is better equipped and better able to address the current economic issues facing the country. That the Republicans will bring inflation and interest rates down, and bring prosperity and fiscal responsibility to the country. It’s all nonsense, of course, but somehow over the years, Republicans have created and/or reinforced the idea that they are superior managers of the economy. The facts show otherwise:
- Since World War II, the US economy (as reflected in GDP, employment, personal income, corporate profits, etc.) has performed better on average under Democratic presidents than under Republican presidents.
- Of the eleven recessions since 1953, ten commenced under Republican presidents.
- Growth in personal income has been greater under Democratic leadership, while income disparity has been less.
- Federal budget deficits have increased under every Republican president since Reagan. During the same period, deficits have decreased under every Democratic leader.
Well, how about Donald Trump, Republicans counter. Didn’t he oversee the country’s “best ever” economy? No, he didn’t. Even if you exclude the period of the pandemic, during which the Trump economy collapsed, Trump’s performance on key measures didn’t even measure up to that of his immediate (Democratic) predecessor.
- Under Trump, GDP growth (pre-pandemic) was comparable to that under Obama, even though Trump’s results were “juiced” by massive unfunded, deficit-ballooning tax cuts
- Also under Trump, the much-ballyhooed job growth actually failed to reach the levels reached under Obama. New jobs in the three years of Trump pre-pandemic totalled 6.1 million. But, in the previous three years under Obama, over 8.0 million new jobs were created.
Joe Biden has had the misfortune of presiding over an economy emerging from a global pandemic. An economy where global economic stimulus collided with supply chain disruptions, labour shortages, and oil price hikes driven by external events such as the Russia/Ukraine war. Perhaps one can fault his administration for pushing the massive stimulus packages, and the Fed for not stepping in early enough to quell inflationary pressures, but American voters should ask themselves whether they really want to punish Biden and his party for events largely outside their control or influence. Is Joe Biden responsible for the cost of a gallon of gasoline going up over 50% since 2020? No. Is Joe Biden responsible for pandemic-driven inflation in most leading economies around the world? No. Most importantly, would having a Republican-led Congress result in lower inflation, lower gas prices, or any other economic benefit for the average American? No. Unequivocally no.
WWRD – What would Republicans do?
So what will happen if the Republicans take over and start dictating economic strategies? They’re rather short on specifics, but history tells us, and even their current statements tell us – they’ll do what they have done for the past 40 years or so. They will pursue a policy of trickle-down, supply-side economics whereby tax rates for corporations and upper tax brackets are decreased. According to Republicans, this leads to an increase in growth and economic performance, thus producing an increase in tax revenues. According to everyone else, it doesn’t work. Never has. That’s why deficits under Republican administrations have increased substantially. That’s why Republican leaders are also floating the idea of scaling back on Social Security and/or Medicare programs – because running Trump-sized deficits is unsustainable.
The Liz Truss plan – Americanized
The Republicans’ economic strategy should look somewhat familiar. It’s very similar to Liz Truss’s “plan for growth” that was supposed to catapult the British economy into an era of prosperity. The “plan for growth” included an immediate reduction in taxes for the wealthiest Britons, cancellation of a planned corporate tax hike, and the scrapping of caps on bankers’ bonuses. The plan was essentially unfunded – it did not include any specifics on how the tax cuts would be paid for. But, when pushed, Truss did not deny that cuts to services and/or welfare benefits would be on the table. Much like the Republican approach – unfunded tax cuts with more than a hint of entitlement cuts.
Rather than catapult the British economy into an era of prosperity, the “plan for growth” catapulted Liz Truss out of 10 Downing Street, and into the record books as the shortest ruling prime minister in British History. Truss was the titular prime minister for a grand total of 44 days, but, excluding the official period of mourning for Queen Elizabeth, during which little actual “governing” was being done, she was the head for only about 7 days. A bit longer than a cricket test match, but, as tracked by a British newspaper, shorter than the lifespan of a head of lettuce.
Why would Americans believe the same strategies that brought down a British government in world record time will somehow work in the US?
Of course, this assumes that the Republicans would actually get around to the economy if they regain congressional control. As noted above, they’ve been rather vague concerning specific measures they would take regarding the economy, except for controlling inflation, where they would immediately repeal the Inflation Control Act. That’s all they’ve committed to. See, a prospective Republican Congress already has a full agenda, according to the wish list of leading Republican lawmakers:
- Impeach Joe Biden
- Impeach Merrick Garland (Attorney General)
- Impeach Alejandro Mayorkas (Homeland Security)
- Hold federal hearings into Hunter Biden’s affairs
- Cancel January 6 hearings and related investigations
- Force spending cuts on Medicare, Social Security, Ukraine assistance
- Rescind actions addressing climate change
- Pursue a national abortion ban
American voters may well wake up next Wednesday having elected a Congress that is no better able to influence the price of a dozen eggs or a gallon of gasoline than the previous Congress. If the Republicans take over, that new Congress will also be one of the most nasty, vindictive, and ineffective in history.
All because too many voters fell for the second-biggest lie.