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~ Wednesday, May 28, 2003
 
Stating the Obvious
By PAUL KRUGMAN

The lunatics are now in charge of the asylum." So wrote the normally staid Financial Times, traditionally the voice of solid British business opinion, when surveying last week's tax bill. Indeed, the legislation is doubly absurd: the gimmicks used to make an $800-billion-plus tax cut carry an official price tag of only $320 billion are a joke, yet the cost without the gimmicks is so large that the nation can't possibly afford it while keeping its other promises.

But then maybe that's the point. The Financial Times suggests that "more extreme Republicans" actually want a fiscal train wreck: "Proposing to slash federal spending, particularly on social programs, is a tricky electoral proposition, but a fiscal crisis offers the tantalizing prospect of forcing such cuts through the back door."

Good for The Financial Times. It seems that stating the obvious has now, finally, become respectable.

It's no secret that right-wing ideologues want to abolish programs Americans take for granted. But not long ago, to suggest that the Bush administration's policies might actually be driven by those ideologues — that the administration was deliberately setting the country up for a fiscal crisis in which popular social programs could be sharply cut — was to be accused of spouting conspiracy theories.

Yet by pushing through another huge tax cut in the face of record deficits, the administration clearly demonstrates either that it is completely feckless, or that it actually wants a fiscal crisis. (Or maybe both.)

Here's one way to look at the situation: Although you wouldn't know it from the rhetoric, federal taxes are already historically low as a share of G.D.P. Once the new round of cuts takes effect, federal taxes will be lower than their average during the Eisenhower administration. How, then, can the government pay for Medicare and Medicaid — which didn't exist in the 1950's — and Social Security, which will become far more expensive as the population ages? (Defense spending has fallen compared with the economy, but not that much, and it's on the rise again.)

The answer is that it can't. The government can borrow to make up the difference as long as investors remain in denial, unable to believe that the world's only superpower is turning into a banana republic. But at some point bond markets will balk — they won't lend money to a government, even that of the United States, if that government's debt is growing faster than its revenues and there is no plausible story about how the budget will eventually come under control.

At that point, either taxes will go up again, or programs that have become fundamental to the American way of life will be gutted. We can be sure that the right will do whatever it takes to preserve the Bush tax cuts — right now the administration is even skimping on homeland security to save a few dollars here and there. But balancing the books without tax increases will require deep cuts where the money is: that is, in Medicaid, Medicare and Social Security.

The pain of these benefit cuts will fall on the middle class and the poor, while the tax cuts overwhelmingly favor the rich. For example, the tax cut passed last week will raise the after-tax income of most people by less than 1 percent — not nearly enough to compensate them for the loss of benefits. But people with incomes over $1 million per year will, on average, see their after-tax income rise 4.4 percent.

The Financial Times suggests this is deliberate (and I agree): "For them," it says of those extreme Republicans, "undermining the multilateral international order is not enough; long-held views on income distribution also require radical revision."

How can this be happening? Most people, even most liberals, are complacent. They don't realize how dire the fiscal outlook really is, and they don't read what the ideologues write. They imagine that the Bush administration, like the Reagan administration, will modify our system only at the edges, that it won't destroy the social safety net built up over the past 70 years.

But the people now running America aren't conservatives: they're radicals who want to do away with the social and economic system we have, and the fiscal crisis they are concocting may give them the excuse they need. The Financial Times, it seems, now understands what's going on, but when will the public wake up?


~ Monday, May 26, 2003
 
May 26, 2003
Democrats Seek a Stronger Focus, and Money
By ADAM CLYMER


ANTA FE, N.M. — Democrats from the West came here in mid-May to share political hopes and fears and to reassure one another that despite President Bush's popularity, their party has a future.

Gov. Bill Richardson of New Mexico, one of the party's handful of big winners last fall, said Democrats had to "develop a strong economic message" and "a strong national security message." Mr. Richardson said the security message had to make it clear that "if we need to use force, we do it."

But other Democrats at the meeting of the Western caucus of the Democratic National Committee either wanted to focus on what they called the Bush administration's misuse of force, or to attack the president personally as "the village idiot from Texas," as Julia Hicks, vice chairwoman of the Colorado Democratic Party, put it.

Like their national counterparts, Western Democrats lack unity, a coherent message and enough money to compete with Republicans. Rachel Virgil-Giron, the New Mexico secretary of state, said, "We don't have the money."

Karen Marchioro, leader of the caucus, said, "God knows we need help." Such laments are common in the party that once dominated American politics but does so no longer.

Nationally, more people, narrowly, call themselves Democrats than Republicans, and on many domestic issues the public trusts Democrats more than Republicans. The Democrats get about half the votes nationally, and their last presidential candidate actually won more votes than Mr. Bush.

But, however slim their margins, Republicans hold the offices of president, speaker of the House, and Senate majority leader. As George C. Wallace once said, "Close only counts in horseshoes and hand grenades." So the Democrats' glass is not half full, but half empty, and it appears to be leaking.

Al From and Bruce Reed of the Democratic Leadership Council, a centrist group that was once the showcase for so-called New Democrats and rising stars like Bill Clinton and Al Gore, recently wrote, "No party ever needed definition, or redefinition, more than the Democratic Party today."

Though immediate attention may focus on the 2004 presidential election, which Democrats could win if the economy remains sluggish and voters blame Mr. Bush, a victory would not necessarily reverse their long-run decline.

In the midst of another of their periodic painful identity crises, Democrats are composed of an awkward coalition whose clan chiefs have not yet gotten over the idea that power is the Democrats' entitlement and who therefore have not yet learned to sacrifice for the greater good. As Don Fowler, a former national chairman, observed, "Our party has so many disparate points of influence that we can never focus enough to achieve our programs."

They have been inattentive to fund-raising from small donors, especially by direct mail, a situation that has grown desperate now that the unlimited donations known as soft money have been outlawed under the McCain-Feingold law, though the measure is being challenged in court. As Donna Brazile, Al Gore's campaign manager in 2000, said, "Without soft money, the party is in poverty."

The Democrats have generally spent their energy defending past accomplishments, from Social Security to Medicare, rather than seeking to refocus that basic commitment to the middle class and the poor into ideas that reflect how the nation has changed since those laws were passed. President Bill Clinton tried to reframe the party agenda, failing with health care, though succeeding with welfare revision and a few other issues. Still, after his troubles with Monica Lewinsky, he largely gave up and instead pushed small ideas, like school uniforms.

For years, Democrats have focused on the short term, both in mechanics and ideas, concentrating on the issue of the month or the year rather than articulating a clear identity, and preferring to try to rally their own faithful rather than seeking to win over the middle or even chip away at groups now heavily Republican. This approach is all the more glaring when compared with the Republicans' success at planning and financing long-range projects and developing a clearly identified platform showcasing a consistent set of issues over the years.

As Peter Hart, a veteran Democratic pollster, put it: "My biggest problem with the Democratic Party is we think tactically and not strategically — one election at a time." Mr. Hart said, "We take the issue we can exploit, but we don't take the party and say this is what we are about." The effect, he said, is that "we always seem to be buffeted by what's in the political winds."

A major reason was defined by Thomas P. O'Neill Jr., speaker of the House from 1977 to 1987, when he would say that "in any other country, the Democratic Party would be five parties." He meant it in ideological terms, from very liberal to very conservative. By now the very conservative wing has almost completely deserted to the Republican Party. But the Democrats are still a coalition of interests, notably African-Americans, labor, feminists and all-purpose liberals.

The party suffers when it is blinded to everything but the demand of one faction. Last fall, even though the issue was plainly hurting candidates like Senator Max Cleland, who lost his race in Georgia, Senate Democrats filibustered against the bill to create a Homeland Security Department, insisting it was a matter of principle to defend labor rights that President Bush wanted to curb. But right after the election, they gave up the principle and let the bill pass.

Daniel Patrick Moynihan, after retiring as a New York senator and unworried about giving offense, said in an interview a month before he died in March that it was unfortunate that the first time all the Democratic presidential hopefuls got together it was to endorse an abortion rights agenda and not some policy more in tune with reaching out beyond the party base. Defense of the medical procedure that critics call partial-birth abortion, he said, "was not right with the American people."

A veteran Democratic consultant looked at the 2004 presidential field and found it symptomatic of a basic party problem: "Sometimes we're so respectful of our diversity that we take completely preposterous people seriously. We always run the risk of the follies of the absurd when people want seriousness."

In particular, he said Representative Dennis J. Kucinich of Ohio, the Rev. Al Sharpton of New York and former Senator Carol Moseley Braun of Illinois were not real potential nominees but "products of the silly season." He said that because Mr. Sharpton and Ms. Moseley Braun are African-Americans, an essential block for any Democratic victory, white candidates were afraid to criticize them over either their effectiveness or ethics issues.

Mr. Fowler found a ray of consolation. He said that while the party's diverse components limit its ability to attain big majorities, they also mean "you're never going to wipe the Democratic Party out."

The Democrats' minority in the House seems sure to continue through the decade. Redistricting to protect both parties' incumbents has left few battleground seats, and Republican money puts many of them out of Democratic reach. The presidency and majority status among senators and state legislators may be attainable for Democrats, but the party's extreme financial weakness could easily cripple those hopes.

Of course American political history has almost as many examples of revivals from near-death as the Democrats have presidential candidates. Republicans were dismissed as finished after landslide defeats in 1964 and 1974. Richard M. Nixon and Ronald Reagan disproved those expectations. Then in the 1980's the so-called electoral lock was believed to prevent any Democrat from ever winning a majority in the Electoral College. Mr. Clinton disproved that.

And there is at least some evidence of Democratic revival efforts, though hardly any Democrat who appears to be a quick fix. The chairman of the Democratic National Committee, Terry McAuliffe, talks of using computers to "find Democratic voters in those red states" (the ones that television showed going Republican in 2000) and to build a base of small donors. For more than 30 years Democratic chairmen have promised to go after small donors, and then have let it slide.

But this time the effort seems real, as the national committee is using various commercial lists to find out more about its existing donors and to identify prospects like them. One early return is that e-mail fund-raising, a very inexpensive method, raised $486,000 in the first four months of this year, compared with $115,000 a year ago — a pittance compared to Republican successes, but still a significant increase.

Other projects include an effort by Governor Richardson to create a political action committee to train Hispanic political operatives and unify Hispanic voters across current divisions of those with Mexican, Puerto Rican, Cuban or Central-American ancestors. The A.F.L.-C.I.O. has set up the Partnership for America's Families, an institution headed by the federation's former political chief, Steve Rosenthal, to do the on-the-ground organizing that political parties used to do (and Republicans have started to do again) including going house to house to get voters registered and discuss issues.

Another project nearing realization is the creation of a foundation like that of the conservative Heritage research group. The Democrats' organization will be led by John D. Podesta, President Clinton's last chief of staff. In September, Mr. Podesta said he expected to open the tentatively named American Majority Institute as "a think tank that both generates new ideas and provides a hard-hitting and consistent critique of the conservatives."

But Democratic efforts to build a new infrastructure pale next to the layers of affiliated political groups, research groups and like-minded media organs that the Republicans have fortified over the decades, especially since the election of Mr. Reagan as president in 1980. And, as Mr. Hart noted, Democrats are not trying to make inroads into Republican constituencies, like white male conservatives (who gave Mr. Gore only 11 percent of their votes in 2000) the way Republicans are going after African-Americans and Hispanics. On the other hand, Hispanic voters are becoming an ever-larger part of the electorate, and still give Democrats a solid majority of their votes.

If there is one thing all kinds of Democrats agree on, it is that they need a better message. Republicans have a very simple agenda of lower taxes, less government and more defense while Democrats have generalities like being for the little guy and attacking more than they propose.

Robert S. Strauss, the former Democratic national chairman who says Democrats seem to win the White House only on Republican mistakes like Watergate or that of the elder Bush in ignoring the faltering economy, calls last fall's performance on issues disgraceful.

"We didn't stand for anything," Mr. Strauss said. "We got what we deserved — nothing."

Will Marshall, an ally of Mr. From and Mr. Reed who leads the Progressive Policy Institute, said the party must "show that we can make progressive government work, not just defend the old New Deal monuments."

Bill Carrick, a more liberal Democratic strategist who is working for the presidential campaign of Representative Richard A. Gephardt of Missouri, said his party had "run out of gas." Mr. Carrick said Democrats would continue to fail if they chose to be "the party of incremental reforms, whether it's anything from school uniforms to prescription drugs, to patients' bill of rights." He said, "We've got to make the move away from incremental new reforms to big and broad issues."

There are two major elements of the Democrats' message problem. One is defensive — on the issue of security. The public strongly prefers Republicans on national defense, and even though most Democrats in Congress backed the war on Iraq, at least a third of the rank and file was unhappy with it, which makes it difficult for party leaders to get too far out in front.

Democrats have argued that the Bush administration is weaker than they are on the other element of security — domestic defense — but have made no headway despite the fact that Democrats wanted a department created to coordinate the effort before Mr. Bush would accept it and have urged greater spending on domestic security than the Bush administration would accept.

A more general problem was identified by Governor Richardson. In an interview, he said it was "very vague, but I think it's out there, that we're not the party of optimism and opportunity, that we're the party of malaise, and we're the party of class warfare."

Two Washington academics, who often agree, take different views of the party's future.

Norman J. Ornstein of the American Enterprise Institute says Democrats may have passed a point where "minority status gels and makes it exponentially harder to get back in" because potential candidates and donors see only minority status in their future.

Thomas Mann of the Brookings Institution disagrees, seeing parity between the parties as likely for some time. He argues that even the lack of a coherent positive message does not matter too much. "Most decisive elections are a consequence of the public rejecting something," he said. The most effective message, he said, usually is the simple "throw the rascals out."

But Democrats these days lack the killer instinct that it takes to sell blunt, demagogic messages. As Bob Shrum, a prominent consultant for 30 years, said: "It's probably a weakness that we're not real haters. We don't have a sense that it's a holy crusade. We don't have a sense that it's Armageddon."

Or, as Mr. Gore's former campaign manger, Ms. Brazile put it: "They play hardball. We play softball."


 
May 25, 2003
Buoyed by Resurgence, G.O.P. Strives for an Era of Dominance
By ADAM CLYMER


EELAND, Mich. — The Republican Party's dream of becoming the dominant party was on full display the other day at the Ottawa County Lincoln Day dinner here. Although George W. Bush lost Michigan in 2000 and the state elected a Democratic governor last November, the national and state party officials heaping roast beef and chicken onto their plates at the local fish and game club were buoyantly predicting they would take the state in 2004.

The attorney general of Michigan, Mike Cox, elected in 2002 by 5,200 votes after carrying Ottawa County by 40,712, said President Bush could count on a "grass roots army of the people who got me in office."

Jack Oliver, deputy chairman of the Republican National Committee, said the county exemplified the Republican Party's renewed focus on "putting people back to work in politics, going door to door, friend to friend, neighbor to neighbor."

With the Congress thinly divided along partisan lines, another presidential election taking shape and the rules of campaign finance in legal limbo, the two national political parties are at crucial turning points.

Republicans are the most encouraged. Party officials around the country, convinced that this may be their moment, are raising the prospect of an era of Republican dominance.

Republicans already hold the White House, expect to continue to control the House of Representatives and have a majority in the Senate. For the first time in 50 years, a majority of state legislators are Republicans. Almost as many Americans (30 percent) call themselves Republicans as call themselves Democrats (32 percent), the narrowest gap since pollsters began measuring party identification in the 1940's.

But Republicans are not stopping there. In Michigan, as well as in other large industrial states that Mr. Bush lost, the Republican Party, nationally and at the state level, is making big investments in building new grass roots operations that its leaders contend will pay huge dividends in the next election — and put the party in an even more commanding position.

One of the architects of Republican growth, Newt Gingrich, the former speaker of the House, summed up where his party stands. "We are at parity right now," he said, "with a slight edge and good prospects."

In contrast, the Democrats are still dispirited by the outcome of the disputed 2000 election, shut out of control of Congress and the White House and confronted by a popular Republican president fighting a war against terrorism. The party finds itself in a desperate effort to rebuild and to avoid permanent minority status.

Still, for all their confidence, wise Republicans remember false dawns of impending majority status after the elections of 1980 and, especially, 1994, when under Mr. Gingrich's leadership the party overreached by challenging President Clinton to shut down the government and got the blame for shutting it down.

Yet Prof. John J. Pitney, a Claremont College political scientist, said: "In the past couple of years, I think we've seen a shift from rough parity to a slight Republican advantage, which I think reflects a shift in public interest to national security, which Republicans own. If you think about bombs and rockets most of the time, you're probably going to vote Republican."

The public greatly prefers Republicans on issues from national security to taxes, though Democrats hold advantages on specific matters like health care and on the more general idea that they care about ordinary people. The Republicans' financial lead is huge and growing, with $441 million in federally regulated contributions to all national party organs in 2001-02, compared with $217 million for the Democrats. That is buttressed by 500,000 new contributors to the Republican National Committee last year and more than 100,000 so far this year.

With Karl Rove, the White House political aide, as their chief strategist, Republicans have serious plans to use their national committee not just to help Mr. Bush get re-elected but also to build their party for the long haul.

Last fall's successes in Congressional elections depended heavily not only on Mr. Bush's campaigning but also on a revived effort to get out the vote, something Republicans had forgotten in recent years while unions worked harder than ever to help Democrats in 2000. The 72-Hour Project, named for the last hours before polls closed but involving months of organizing, tapped heavily into people, like evangelical Christians, who have voted heavily Republican for president but usually skip off-year elections.

For 2004, the party will move into another realm that is usually the preserve of Democrats: voter registration. Matthew Dowd, the president's pollster, said computers would identify nonvoters in Republican neighborhoods. That and other registration efforts, including having party workers at naturalization ceremonies, could "expand the pool of voters" by as many as three million, Mr. Dowd said.

At the same time, Republicans are trying to make inroads into Democratic constituencies like Hispanics, African-Americans, union members and Jews, he said, so that "long before Democrats can go after swing voters, they have to solidify their base."

A rising Pennsylvania Republican, State Representative Kelly Lewis of East Stroudsburg, said he won minority votes in 2000 after coming to the aid of minority homeowners who were losing their homes after developers and builders enticed them into taking out fraudulent loans. "Instead of ignoring it because it is happening to `them,' " Mr. Lewis said, "we just did it as an issue because it impacted people."

Marc Racicot, the Republican national chairman, spoke of outreach programs toward people "we think are Republicans who just don't know it yet." He acknowledged that with some groups, including blacks, "we have an uphill challenge sometimes, to prove to nontraditional Republicans that we are worthy of their trust."

Of course, parties always have plans.

The reason to take these intentions seriously is that since 1974, the Republican Party has stayed with such seemingly mundane efforts as direct-mail fund-raising, campaign training schools and recruiting candidates for state legislatures, treating them as farm teams to provide eventual major leaguers. It has encouraged and worked with policy institutes like the Heritage Foundation that translated ideological instincts into legislative proposals with defensible numbers attached to them. Ronald Reagan passed out the foundation's "Mandate for Leadership" at his first cabinet meeting, and the foundation helped fill the ranks of the current Bush administration.

None of those avenues to power have been ignored by the Democrats, but the Republicans have stayed with them and fortified them far more intently.

Another reason to take Republican aspirations seriously is that Republicans live by the adage of the satirist Finley Peter Dunne's Mr. Dooley, "Politics ain't beanbag." They have built their strength in the South by appealing to white resentment of civil rights policies, and sometimes by discouraging voting by blacks, as they did last year in Louisiana's Senate runoff, which the Democratic incumbent, Mary L. Landrieu, won anyway by a margin of four percentage points. When it comes to hard-hitting campaign advertisements, they have used everything from Willie Horton's image to the suggestion that Senator Max Cleland, who lost both legs and an arm in Vietnam, was unconcerned about national security.

Today's aspiring majority has its roots in the wreckage of Watergate, the 1974 election when Republicans lost 43 seats in the House, ending up with fewer than a third of the seats. They lost 6 governorships and held only 12, only 2 in any of the 10 largest states. They came out of the election with 2,385 state legislators, down 618 or 21 percent.

Robert M. Teeter, a Detroit pollster, was hired to measure the party's troubles in a national survey. His report to Eddie Mahe, the executive director of the Republican National Committee, was blunt: "We are no longer a minority party. We have achieved the status of a minor party."

That poll showed that 18 percent of Americans thought of themselves as Republicans, a low, while 42 percent were Democrats. At least as bad, Mr. Teeter said in the report's summary, "While the Democrats are seen as being somewhat too much for labor and blacks, they are also seen as being the most patriotic, having the greatest belief in hard work and the value of hard work, and by a very large margin the most open to new people, the most concerned for `people like you' and having the strongest belief in the value of helping others." Sixty-one percent of those surveyed in the study said Republicans excessively favored rich people.

The party turned quickly to devices then considered shocking, like having President Gerald R. Ford sign a fund-raising letter for House candidates in 1975. It was not an immediate path to solvency; the party had to close its doors for a month in 1975. Despite Mr. Ford's defeat in 1976 by Jimmy Carter, the party continued rebuilding. Bill Brock, the national chairman from 1977 to 1981, pushed direct mail, not just to raise money but also because he thought it would provide a core of committed partisans. "It was not only good economics; it was good politics," Mr. Brock said recently.

Mr. Reagan's nomination in 1980 (after his near-miss in 1976) was the biggest step on the road back. His success convinced suspicious conservatives that the political deck was not stacked against them, and they enlisted in the Republican Party and ultimately took it over.

Nancy Sinnott Dwight, a Midwestern moderate who ran the Congressional campaign committee, said, "For us to prevail, the party was going to have to be hospitable to people far to our right."

Mr. Reagan reciprocated by turning to moderates. He chose George H. W. Bush, who had derided Mr. Reagan's tax-cutting plans as "voodoo economics," as his vice president, and Mr. Bush's campaign manager, James A. Baker, as White House chief of staff.

This accommodationist style has continued to work for Republicans, because for all the stories that get written about divisions over abortion and the environment, Republicans are more cohesive than Democrats and have a few core beliefs — lower taxes, less bureaucracy, more military spending — that unite them more than social issues divide them.

While Mr. Reagan's victory brought in a Republican Senate and a lot of House members, those gains did not last. It took Mr. Gingrich to make the Republican trend deeper than the presidency.

They laughed when Mr. Gingrich started talking about controlling the House. After all, it had been Democratic so long (since 1955) that it almost seemed to be part of the Constitution.

"They thought I was crazy," Mr. Gingrich said recently. But he was dedicated in working to create a unifying message and ruthless in his attacks on corruption — real and exaggerated — among Democrats, and Republicans won the House in a landslide in 1994.

Republicans have held that House majority through intense discipline, dedicated candidate recruitment and heavy spending, and much more forceful House leadership than Democrats ever managed. Their narrow majorities have held them together better than the Democrats' past big margins.

Barring economic calamity, the House seems securely Republican until at least the redistricting after the 2010 census. In the Senate, the Democrats have more tough seats to defend than the Republicans do. The presidency is perhaps the least secure Republican base, if only because personalities and the qualities of campaigns can turn those elections around. As Mr. Gingrich said, "The presidency is the least mathematical and the most prone to chance of all the major offices."

But Republicans have the advantage, and not just because of mechanics like direct mail or the 72-hour project or Ottawa County's 500 volunteers at the last election. For 20 years or more Republicans have been selling ideas that the public likes. As Mr. Teeter says, "You look where the country is: foreign policy and national security, economic and tax policy, and line them all up — it is a center-right country."

Those values worked for Bob Beauprez, a representative from Denver's suburbs. Before he won by 121 votes last fall, he went out and asked for votes in communities that his party often ignored. Mr. Beauprez said he won votes from Hispanics and Asians "who came here looking for the American dream" the way his Belgian ancestors did. He said they liked the Republican message of "less government, personal responsibility, strong national defense and strong family values."

But none of it might have worked for the party were it not for the Watergate debacle of 1974 and four more years out of power after Mr. Carter won in 1976. As Wilma Goldstein, a veteran Republican operative whom Mr. Mahe brought into the national committee, said recently: "You almost have to roll over and be dead before you can revive. We had to do new things because we had one foot in the grave."



TOMORROW: The Democrats' identity crisis.


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