Liberals have been deeply disappointed in the Obama administration's failure to either push for a larger stimulus or, failing that, to pin the blame on the Republicans for blocking any further stimulus. But the political obstacles on this front are steep, as William Galston does a pretty good job of laying out:
On Thursday, Andrew Levison published a memo asking “Why Can’t the Dems Make Jobs a Winning Political Issue?” His answer: While Democrats’ default response to high unemployment and slow growth is Keynesian, “a very strong anti-Keynesian perspective on job creation is extraordinarily widespread among American voters.”...
For Democrats to appeal successfully to the ambivalents, Levison contends, they must grapple with four realities:
1. “Simply repeating the traditional Democratic narrative—regardless of how frequently or emphatically—will not produce significant attitude change.”
2. “Doubts about the ability of government to create jobs reflect not only a disbelief in Keynesian remedies for unemployment but also the profound doubts many Americans have about government in general.”
3. “Attempts to convince the critical group of ambivalent voters have to be based on those voters’ distinct way of thinking about political issues—the desire to find a ‘common-sense’ middle ground.”
4. “The widespread progressive assumption that job creation should necessarily be just as popular today as it was in the 1950s and 1960s is simply wrong.”
Levison concludes that any effective Democratic message must tackle the public’s deep skepticism about government and convince the ambivalent portion of the electorate that the party’s economic prescription reflects common sense rather than obsolete assumptions.
Also on Thursday, a second report was unveiled, this time from Democracy Corps, a group headed by long-time Democratic survey researcher Stan Greenberg and party stalwart James Carville. Based on a new survey, it reaches conclusions that are broadly consistent with Levison’s.
The difficult underlying fact here is that Americans don't buy Keynesian economics. I think this stems overwhelmingly from economic ignorance, but it's a reality nonetheless. Now, if Republicans happened to control the government starting in 2009, maybe Democrats could get people to buy into the idea that we should try Keynesian remedies. But when Democrats are in charge and the economy is getting worse, changing peoples' minds toward the liberal position is essentially impossible.
The positive news for Democrats is that Republican control of the House gives them a chance to shift some of the blame for the economy onto the opposing party. (Indeed, the current set of policies -- continuing Bush-era tax rates while reducing public payrolls -- is a weak version of the preferred Republican macroeconomic approach.) In any case, the historical evidence that presidents can use their bully pulpit to reshape public attitudes is thin. I can see the argument that Obama could have gotten a larger stimulus if he asked for more in early 2009 -- quite possibly the moderates would have just trimmed a bit off a larger starting point.
The case that Obama could have done more after that seems pretty weak. He had a weak hand with public opinion, and obviously Republicans had no incentive to help him out. But Obama needs to use every tool remaining, and he needs to seize every opportunity to make Republicans take responsibility for the degree to which they have steered economic policy. Federal Reserve vacancies are one area where Obama has no defense, and I don't think anybody has even tried to mount one on his behalf.
Obama has let vacancies on the Federal Reserve go unfilled, and failed to make Republicans pay for blocking his Nobel Prize-winning nominee, Peter Diamond. People may not be Keynesian, but surely they understand that a Nobel-winning economist is probably a good economist, and leaving important jobs unfilled can't help.