Mitch McConnell, Paul Ryan (AP/Manuel Balce Ceneta/Jeffrey Malet, maletphoto.com)

Research shows Democrats are better for the economy — so why do voters trust Republicans more?

Contrary to what Republicans would have you believe, "a robust safety net can exist alongside a vibrant economy"


Sean McElwee
August 20, 2016 2:30PM (UTC)

While it’s true that presidents don’t have as much influence over the economy as most Americans imagine, Republicans have successfully created the image that they are superior economic managers to Democrats (even though the evidence suggests the opposite). However, Trump has also run a dramatically different campaign than most Republican presidents. Rather than focusing on economic growth and regulation, his speeches center around crime and immigration. That, coupled with the Great Recession occurring during George W. Bush’s tenure and former President Bill Clinton presiding over quick growth, gives Democrats a window to redefine themselves as the party of economic growth. The question is whether they can seize it.

Economic Growth

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While the GOP convention news focused on Melania Trump’s plagiarism and Steve King’s claim about white civilization being superior, another thing that set it apart was that there was very little traditional GOP red meat. Rather than focus on jobs and economic growth, the convention centered around crime and undocumented immigration, both of which have decreased dramatically in the last several years. Indeed, recent Pew data suggest that the economy and jobs are far bigger concerns for the public than immigration and crime (though terrorism ranks high).That is true for Republicans, Democrats and Independents. Gallup data show that while the economy has declined in importance, is it still ranked far higher than immigration and crime.

Further, numerous studies, using numerous different methods, suggest that Democrats are better for economic growth and jobs than Republicans. In addition, under Democrats, the growth is distributed more equally across income groups. New research shows that while Republicans use the tax code to enrich the wealthy, Democrats use it to strengthen the middle class. Other research suggests that income growth is stronger for both whites and people of color under Democrats. Research also suggests (see pages 202-204) that when a party is in power during a financial crisis, they tend to struggle electorally afterward.  Obviously, many factors affect economic growth and job growth, however, Republicans have claimed for years that Obama’s progressive economic agenda would lead to economic collapse, and that simply hasn’t occurred.

In addition, there are many reasons to believe that progressive policies are more effective at boosting economic growth than conservative policies. I’ve detailed the case extensively elsewhere, but new research finds that maternity leave bolsters entrepreneurship among women (see Nick Bunker for other studies supporting this view). However, FiveThirtyEight analysis finds that Americans prefer Trump to Clinton on only two issues: terrorism and economy/jobs.

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Many have criticized me (and others) for noting the economic record under Obama has been largely positive, arguing that this is primarily a natural recovery. It’s true that presidents likely don't account for as much of economic growth as the general public seems to believe. However, as Ben Casselman notes, a president’s decisions matter in the long-term. As Dylan Matthews has shown, there is powerful evidence that Obama’s response to the financial crisis helped the economy recover. More importantly, Republicans have consistently claimed that Democrats would tank the economy with legislation like the Affordable Care Act and other government interventions. The reality, however, is that a robust safety net can exist alongside a vibrant economy. Indeed, the evidence suggests a robust safety net may foster entrepreneurship. A recent Economic Policy Institute study finds that austerity has hampered the recovery (see Jeff Spross’s fantastic summary). Republicans are simply wrong about the economy, and Democrats should be more aggressive in pointing that out.

Winning the Narrative

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There are reasons to believe that the power of narratives in politics are overstated. Elections tend to be determined by economic fundamentals, campaigns, incumbent popularity and simple desire among the public for change. However, as Libby Nelson notes in Vox, Democrats are stealing powerful Republican narratives. The economy is largely out of the hands of presidents, but Republicans have managed to craft the narrative that they are better economic managers, even though by every standard imaginable, the economy fares worse when they are in power. Why? Part of the explanation is motivated reasoning. Political scientists Brian Schaffner and Cameron Roche find that a positive jobs report while Obama is president leads Democrats to a closer estimate of unemployment and Republicans to a worse one.

However, this doesn’t explain why Republicans are perceived as better economic managers by Independents. As political scientist Larry Bartels notes, part of the answer could be that growth tends to be abnormally good during the latter parts of Republican administrations, while it tends to be better toward the beginning of Democratic administrations. Another is that media often focus on measures of the economy that are more important to the wealthy (such as the stock market), and Republican policies tend to be benefit the wealthy.

Another reason that Republicans may still be seen as better economic performers is that political attitudes tend to be sticky - that is, they are defined as young people reach adulthood and tend to remain thereafter. The cohort who entered adulthood during Reagan's morning in America continue to lean Republican to this day. The problem for the GOP is that these voters are quickly exiting the electorate. For voters under the age of 35, their political awakening is defined by a Great Recession under George W. Bush, followed by a recovery under Obama. At the same time, they have seen the Republican Party become increasingly rabid, abandoning all norms of democratic politics, falling into racist demagoguery and nominating a white nationalist to their ticket. At the same time, the Democrats become the first major party to nominate a woman for president and have embraced core parts of Bernie’s more progressive agenda. Even before Trump was nominated, young people were less likely to identify as Republican than older folks (see chart). Research finds that young people who experience a recession have more progressive views and are more likely to vote for left parties. According to the 2012 American National Election Studies (ANES) survey, 41 percent of those older than 65 said the Republicans were better than Democrats at handling the economy, compared with 26 percent of those between 17 and 34.

According to YouGov data, while 40% of those over 65 are "confident" of Trump's ability to handle the economy, only 23% of those under 30 are.

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Conclusion

However, there’s another explanation that isn’t often discussed, largely linked to what some have called the “hack gap.” Republicans have created a mythology that tax cuts for the rich create growth the trickles down throughout the economy. Republican elites have constantly repeated this narrative, even as it has been repeatedly debunked.

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Under both Bill Clinton and Barack Obama, Democrats still praised the private sector as an engine of growth, playing into the Republican Party’s hands. After all, if the Third Way Clintonite narrative is right and the private sector  is the source of prosperity, voters might think, why not just do what the Republicans say, and unleash it completely? In their book, American Amnesia, political scientists Paul Pierson and Jacob Hacker find that both parties have moved toward rhetoric that is more critical of government (see excerpt here). Political scientists Peter Enns, Nathan Kelly, Jana Morgan and Christopher Witko provide one plausible reason why: As politicians become more reliant on contributions from the wealthy, they become more likely to prioritize the deficit in their speeches.

Instead of bashing government and praising “job creators” Democrats must espouse a narrative that places the government and the safety net as a core component of economic growth. Such a narrative would emphasize the important ways that government creates the environment for growth, with infrastructure investment, science and technology research, education, childcare, healthcare and a safety net as a backdrop. Democrats briefly experimented with middle-out economics, the argument that policy should focus on the middle class so that it can afford to consume. However, this narrative is incomplete. As my colleague Tamara Draut argues, a better framework would be bottom-up: emphasizing that the working class is an engine for economic growth, and as long as they are left behind, our society struggles. Such a narrative would not be popular with the donor class, but is a closer representation of the actual economy. The Republican party has placed the wealthy at the center of the economy, but in reality, it is the public sector and working class. Republicans claimed they were making the pie bigger, when in reality they were letting the rich grab up increasing swaths of the American economy. An economic system that allows all Americans to flourish is the path to prosperity. But Democrats have to embrace the public sector, instead of austerity.


Sean McElwee

Sean McElwee is a Salon contributor and a policy analyst at Demos Action. His writing may be viewed at seanamcelwee.com. Follow him on Twitter at @seanmcelwee.

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