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If There's A Recovery, Who Owns It?

The economy added 151,000 jobs last month. See, Republican control of the House is already bearing fruit!

I'm joking, obviously, but it's not entirely a joke.  The jobs news is consistent with two basic stories. The first story, emphasized by liberals, is that mass unemployment is the new normal, and we'll keep adding enough jobs to tread water but not nearly enough to fill in the massive jobs deficit. The second story is that we're going to start gradually picking up momentum, and within a year or two be adding jobs rapidly and enjoying falling unemployment.

For the purposes of public policy, I think you have to assume the first scenario. But politically, it's worth noting that Republican gains have eaten into President Obama's upside. If the economy does improve and Obama wins reelection, Republicans are going to claim partial ownership of his record just as they did with Bill Clinton. You remember that Clinton's 1993 austerity budget, with its upper-bracket tax hike, was decried by Republicans as wealth confiscation that was sure to trigger a recession. When the economy boomed, they went on to tell a story about Clinton moving to the center. The same will happen with Obama -- any good economic news that happens from hear on out is now going to be a result of a rightward Obama shift, when of course it could just as easily be a result of something that happened anyway. (Indeed, the strength of the recovery will itself determine whether future Republicans say Obama moved to the center or remained an unrepentant liberal.)

This won't matter much for Obama's reelection, which largely depends on whether the economy does recover. But it does effect the story people tell themselves about what kinds of policies work and which ones don't. If you imagine that Obama won his election in 2010, at the trough of the recession, and saw unemployment fall during his presidency, and kept control of Congress through two terms, you could see a narrative of Democratic policies causing prosperity breaking through, as it did with Roosevelt. Obama, like Clinton, is unlikely to enjoy such a benefit.