James Pethokoukis

Politics and policy from inside Washington

Making sense of Sarah Palin’s third-party threat

Oct 19, 2010 19:53 UTC

For Sarah Palin, it’s Tea Party first, Republican Party second:

Some in the GOP, it’s their last shot, it’s their last chance. We will lose faith, and we will be disappointed and disenchanted from them if they start straying from the bedrock principles. … If they start straying, then why not a 3rd party?

A few observations:

1. She’s in, but not as a third-party spoiler. Let me reiterate that I think Palin is almost certainly running for president as a Republican. So does the Romney campaign. So does Weekly Standard reporter and Palin expert Matthew Continetti:

I do [see her running]. I see her endorsing candidates and joining them on the trail, raising money through her political action committee, establishing a national voice through her books and upcoming television series, and engaging the Obama administration through television appearances, Facebook, and Twitter. Palin sees her influence in Republican circles, sees her continued popularity among Republicans, sees the potential weaknesses in Obama, and sees the potential parallels between the 1980 election and the 2012 election. She’s getting ready.

2. She has a shot. I also think she can certainly win the GOP nomination and presidency. The media-created caricature of her has created such a low competence hurdle that she only needs to be as well-spoken/well-versed on policy as the typical member of Congress to clear it.  In fact, she may already be there. And don’t underestimate the Dancing with the Stars factor.  Bristol Palin’s time on the show is allowing America to see a whole another side of the Palin family, one that seems firmly in tune with middle-American culture.

And the bigger the GOP primary field — and it is looking like it could be quite crowded right now — the better it is for her (and Mitt Romney). As for the general, two more years of abnormally high unemployment — twice as high as the typical level for the past generation — has created  for vulnerability for Obama that is hard to measure. But the midterm results will give a big hint.

3.  She has a potent potential agenda. If I were plotting a Palin campaign, I would encourage her to run on a free-market populist agenda. That would mean pushing free trade agreements while attacking Obama for being soft on Chinese protectionism. That would mean advocating less cumbersome financial regulation while attacking Obama for not breaking up the big banks on Wall Street. That would mean advocating lower corporate taxes but reducing corporate loopholes and subsidies. In short, portray Obama as soft on banks, China and big business.  That, and him being a big spender and taxer who has failed to turn around the U.S. economy, natch.

4. She’s Ronald Reagan — at least a smidge. Palin frequently invokes the name of the 40th president. Of course, she can’t match his decades of debating public issues before winning the presidency in 1980. But like RR, Palin has been maligned and downgraded by the media and punditocracy. But when Reagan stood next to Jimmy Carter and got to make his case in his own words, opinions changed.


I never really had a problem with John McCain – a tad old, but generally a pretty reasonable guy. But I will NEVER forgive him for bringing this woman to (in her words) ‘Lame-stream media’ and giving her an agenda to push. If Neo-Cons could take off their partisan hats and instead put on thinking hats I would sleep so much better and Sarah Palin would return to obscurity – or Hollywood?

Also – though not as if Americans care – but the rest of the world thinks LESS of Sarah Palin than even her most strident haters in America. Food for thought…

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Is the Democratic comeback fizzling?

Oct 19, 2010 17:09 UTC

Numbers from Gallup seem to say it is.

Gallup’s tracking of the generic ballot for Congress finds Republicans leading Democrats by 5 percentage points among registered voters, 48% to 43%, and by 11- and 17-point margins among likely voters, depending on turnout. This is the third consecutive week the Republicans have led on the measure among registered voters, after two weeks in September when the parties were about tied.

For Republicans to lead, or even be at parity with Democrats, on the generic congressional ballot indicates they are in a good position to win a majority of House seats in the upcoming elections. This is because of Republicans’ typical advantage in voter turnout, which in recent years has given that party an average five-point boost in support on Election Day.

If the elections were held today and roughly 40% of voters turned out — a rate typical in recent years — Gallup’s Oct. 7-17 polling suggests Republicans would win 56% of the vote — 8 points greater than their support from registered voters, and 17 points ahead of Democrats, at 39%. If turnout is significantly higher, Republicans would receive 53% of the vote (a 5-point improvement over their registered-voter figure), and the Democrats, 42%.


Relitigating the 1990s boom

Oct 19, 2010 16:32 UTC

Over at e21, former Bush administration official Joel Harris provides a nice reminder about the real  foundation of the 1990s boom. And it was not the Clinton tax increases:

The story of the 1990s economy holds an important lesson for today’s tax debate, but it’s not the one the Administration intends by invoking it. While the Clinton-era expansion did indeed take place under higher tax taxes, it was largely due to crucial changes in IT production and investment that led to growth and once-in-a generation productivity gains. The lesson here is a basic but important one: the past doesn’t predict the future. If the Administration believes there are similar productivity gains on the horizon that will lift the U.S. economy out of its financial crisis-induced hangover, it should explicitly identify the source of these gains. Otherwise, the 1990s experience provides no guidance for what to do about the tax policy set to expire on January 1.

Pay attention: How New Zealand cut spending and taxes

Oct 19, 2010 16:03 UTC

A fantastic Reason article looks at how Canada and New Zealand cut government spending.  Since GOPers often cite NZ’s experience, I found that portion of the piece particularly interesting. Over the span of a decade from the mid 1980s on,  the government’s share of GDP  fell to 27 percent from 45 percent. Here is a bit on how they did it, according to former government official Maurice McTigue (but please read the whole thing):

Privatization: From 1986 through the mid-1990s, New Zealand sold off airlines, airports, maritime ports, shipping lines, irrigation projects, radio spectrum, printing offices, insurance companies, banks, securities, mortgages, railways, bus services, hotels, farms, forests, and more.

Rightsizing government agencies: After we eliminated those government functions, the bureaucracies that used to perform them were too large to perform their remaining tasks. So the civil service was reduced by 66 percent. Some agencies remained almost the same size, while others were reduced by 90 percent to 100 percent.

Cutting taxes: At the same time, we reformed the revenue system by eliminating capital gains taxes, inheritance taxes, luxury taxes, and excise duties and by allowing income to be taxed only once. We halved tax rates, eliminated all deductions that were not a cost of earning income, and created a system where one-third of revenue came from consumption taxes and two-thirds came from income taxes. Under the simplified system, about 65 percent of the population no longer had to file tax returns—a major selling point for reform.

Reforming the appropriations process: With the State Sector Act of 1987 and subsequent laws, funding was linked directly to results. Agency heads were now CEOs, chosen for capability. They received fixed-term contracts: five years with a possible three-year extension.

A decade-long dollar disaster

Oct 19, 2010 15:46 UTC

They’re calling The Oughts a Lost Decade. Yet how could that possibly be? The experts keep telling me a weak dollar brings prosperity. But look at this chart from Carpe Diem: