Sunday, 17 April 2011

Can Obama cling on?

Here I go again with my attempts at electoral strategy. I'm predicting that Obama stands a good chance of winning the 2012 election if - and only if - the Republicans choose a hardline candidate who adopts hardline policies. If the Republicans get their strategy right, I think it could be in the bag for them. Not that my own ivory tower ramblings are any help to him, I thought I'd outline how I think Obama can increase his chances of being reelected in 2012.

Unlike the Republicans, the Democrats haven't got to worry about selecting a candidate. There may be a few renegades who seek to challenge Obama for the Democrat candidacy, but it would be political suicide and any who attempt it will fail. Therefore, it's vital that Obama gets his tactics and policies right.

Most important is the economy and government finances. The Republicans have rightly succeeded in making a big issue out of the deficit and debt, and if Obama doesn't tackle it right, it could be the thing which loses him the election. In terms of electoral tactics, the most important card he can play is to point out the failure of Republicans in the past and the success of past Democrats in terms of economics and the Budget. There's a big well of hypocrisy to be tapped in pointing out that Reagan, George H.W Bush, and George W. Bush all ran deficits, and that the only recent President to run a surplus was  a Democrat - Bill Clinton, who reduced the deficit so much that he ran a surplus from 1998-2000. When W. Bush took over, the country again returned to running deficits and did so consistently throughout his tenure. Given his hero status, attacking Reagan could be dangerous, but if the Republicans are seeking to idolise him as an idol of small government and sensible finances as they sometimes do, there is clear scope for countering these claims by pointing out that facts, with it being higher for the most part than it was under the often-lambasted Carter.

Certainly it would also be a good idea to highlight the bank bailout as being a key reason for the sharp rise in deficit, and the economic stimulus as being part of the reason it remains high, and to show that something is being done about it, it should be highlighted that the shortfall is projected to fall to 3.2% of GDP by 2015. I suspect that pointing out that large increase in the deficit is as a result of the bank bailout could help to turn anger away from Obama and towards banks. If he succeeds in creating public anger not only amongst the working class but also the more well-heeled middle incomes, he has a good opportunity to begin to increase his rhetoric against the banks and adopt the policy of imposing greater taxation on banks or, as the UK government is looking into, splitting up the activities of banks to ensure their risky practices can't cause such an issue again.

There is also some clever use of statistics which can be employed. In order to play down the current deficit, it can be spoken about in proportion of GDP; it's probably less shocking to say that the deficit is 10% of GDP than it is to say it's projected to be $1.6 trillion this year. Similarly, highlighting that wartime deficits have risen to as much as 28% of GDP may help to play down the current situation and calm nerves. Conversely, in certain contexts it might be useful to use numbers, for example: "George Bush left us with a $1.4 trillion deficit", which makes the figures sound larger and likely has more impact in showing that this is a long-running problem and that the blame cannot be placed at Obama's feet.

Spin and strategy aside, it's important that Obama has strong policies which outline how he will go about turning the deficit into a surplus, or at least eliminating the deficit. If he has deficit-reducing policies which are more palatable and appealing to the majority of people, then he could not only take the wind out of the sails of what will be a key plank of the GOP campaign, but also win the argument on the finances. Like most, I'm not incredibly well-versed in the nuances of US public spending, so I have used the excellent NYT Budget Puzzle to find ways to eliminate the deficit in a moderate, centre-ground way which should appeal to more voters than the more hardline, painful spending cut measures the Republican candidate is likely to adopt.

67% of the deficit elimination measures I selected come from tax rises, and the remaining 33% from spending cuts. I am pleased to say that the tax rises have a minimal impact upon lower and middle incomes, mostly impacting higher earners. The measures are outlined below if you're sad enough to be interested, otherwise just keep on scrolling: (Sorry if you see a random load of incomprehensible text along the side of the table. I tried fixing it. If you used a modern standards-compliant browser it would look fine.)

Measure
Chosen?
Rationale
Cut foreign aid in half
No
Would harm USA in foreign relations and go against Obama’s attempts to improve the situation for the impoverished. Efficiency savings and stopping aid for some countries may be viable, though.
Eliminate earmarks
Yes
Simple measure, widespread support and popular with the public.
Eliminate farm subsidies
No
Risks losing rural and farmer vote. Potential danger to the economy. Could look at reducing subsidies, though.
Cut pay of civilian federal workers by 5%
Yes
Ensures that public sector workers feel the same pinch as private sector workers did during the recession. Likely to play well with many voters. Could help take votes from GOP.
Reduce federal workforce by 10%
Yes
Similar rationale to above. Relatively minor loss of 10,000 workers from 200,000. Would not result in rise in unemployment due to leaving workers not being replaced, rather than existing employees being laid off. Could help take votes from GOP.
Cut 250,000 government contractors
Yes
Number of contractors has risen substantially in recent years. Such cuts are necessary to avoid spending cuts to services. Could help take votes from GOP.
Other cuts to federal government
No
Would damage such things as National Parks, thereby harming the environmentalist vote. Further votes would be lost by eliminating regional subsidies
Cut aid to states by 5%
No
Most states are already grappling with deficits. This would result in larger cuts in each state and would be seen as shifting the burden.
Reduce nuclear arsenal and space spending
Yes
Defence is largest expenditure area of the federal government. No longer necessary to have such large amounts and cuts to this avoid cuts to public services.
Reduce military to pre-Iraq War size and further reduce troops in Asia and Europe
Yes
As the combat in Afghanistan and operations in Iraq wind down, troops can be safely cut. Helps to avoid cuts in services.
Reduce Navy and Air Force fleets
No
Too many cuts in this military would hand the GOP an easy area to attack Obama as weak on defence.
Cancel or delay some weapons programs
Yes
Cheaper alternatives with similar capability can be purchased. No longer tenable to spend such large amounts on weapons.
Reduce noncombat military compensation and overhead
Yes
Health insurance premiums have not risen in over a decade. Need to rise to help reduce deficit.
Reduce the number of troops in Iraq and Afghanistan to 60,000 by 2015
Yes
Do-able and saves a large amount of expense on an unpopular war. Could help retain support from liberals and sceptics of the war by showing that the US is moving closer to the end.
“  ” 30,000 “ ”
No
Too large a cut in troop numbers. Would seem unpatriotic.
Enact medical malpractice reform
Yes
This is atypical Republican issue. Tackling it would help take the wind out of their sails.
Increase the Medicare eligibility age
No
Likely to lose support from the elderly, poor, and liberals. Could make the Republicans look mean and uncaring if they propose it.
Reduce the tax break for employer-provided health insurance
No
Important to encourage employers to provide the employees with good coverage.
Cap Medicare growth starting in 2013
No
Democrats are expected to defend Medicare and welfare. Would be good fodder to portray Republican candidate as heartless if he plans to do this.
Raise the Social Security retirement age
No
Would lose support of the elderly and poor. Would go against Democrat ethos. Not an election-winner to tell people to retire later!
Reduce Social Security benefits for those with high incomes
Yes
A fair cut which would be supported by most. Can make moral case that it's wrong to expect everyone to help pay for the wealthy to have these benefits.
Tighten eligibility for disability
Yes
Help to prevent people playing the system. Likely to be popular with most voters and taps into GOP ground.
Use an alternate measure for inflation
No
Would effectively be a long-term cut through the backdoor, and it would be seen as such in the media and by opponents.
Return the estate tax to Clinton-era levels
Yes
Beings at $1 million, meaning most people still exempt.
Obama's investment tax proposal
Yes
Leaves low and average incomes exempt, but keeps 15% rate for those earning above this, and applies 20% rate for above $250,000 salaries. Returning to Clinton-era levels rejected as too harmful to average earners.
Allow expiration for income above $250,000 a year
Yes
Unfair to keep tax cuts for high earners. Good material for attacking Republicans as defending the wealthy if they oppose it.
Allow expiration for income below $250,000 a year
No
Too harmful to middle and low income. Need to be wary of applying too many tax rises to the upper middle class - need their votes.
Payroll tax: Subject some incomes above $106,000 to tax
Yes
Fair rise on higher incomes.
Millionaire's tax on income above $1 million
Yes
Would impact a minority and is unlikely to be opposed by many.
Eliminate tax loopholes, but keep taxes slightly higher
Yes
Closes tax loopholes and cuts tax rates slightly, but less than the Bowles-Simpson plan. Implementing said plan would have left a deficit. Average people don't benefit from loopholes, and can be portrayed as having been abused by business and the very wealthy.
Reduce mortgage deduction and others for high-income households
Yes
Unfair to expect average people to subsidise the wealthy.
National sales tax
No
A regressive tax which would be highly unpopular and would be seized upon by opponents as evidence of overly-large federal government.
Carbon tax
No
Makes it harder to win the moderate conservative vote. Likely to be an administrative nightmare and a disincentive to business.
Bank tax
Yes
Banks deserve to bear a greater burden after having been given a bail-out. Likely to be supported by most.

Surplus in 2015: $247bn
Surplus in 2030: $17bn

I think the above measures are fair and will be tolerable to most people. It avoids cuts to services and welfare for most people, but recognises the need to balance the books. One of the more contentious areas may be the cuts in defence, which run the risk of making it harder to pick up wavering Republican voters and leave the door open to attempts to portray Obama as putting the nation at risk and being unpatriotic. It's difficult to know how to respond to such attacks aside from the obvious response of pointing out that keeping defence spending as it is means big cuts to services and welfare or tax rises on ordinary people. Moreover, it can be pointed out that as Afghanistan and Iraq wind down, such high levels of defence spending are less necessary.

A key attack against the Republican candidate can be that the party has routinely opposed tax rises, most recently blocking attempts in Congress to end the Bush tax cuts for the wealthy. It makes no sense for a party committed to balancing the books to oppose undoing the tax cuts which caused the deficit to rise more rapidly. Certainly it can be great material for Obama to claim that the Republicans are detached from reality and deliberately seek to cut spending whilst ideologically defending the most wealthy in society.

The surplus ensured by the above changes for 2015 is probably much larger than it needs to be, but this was because I was intent upon ensuring that it US would still be running a surplus by the time 2030 comes around. You may note that the size of the surplus has dramatically fallen by 2030, which will be down the rising cost of things like Medicare. No further action would be needed to continue to run a surplus, but at some point these measures will cease to be enough. At which point a future administration would need to look at making tougher decisions like implementing Medicare caps and changing the inflation measure. For now though, such measures remain too risky to win an election and too risky to implement in a still wobbly economy. In practice, there is more flexibility than the above plan allows for, as there doesn't necessarily have to be a commitment to running a large surplus by 2015.

Moving on, I also suspect that it's going to be important for Obama to be ready to defend his economic policies against inevitable attacks from his Republican opponent. Most importantly he needs to defend the stimulus which will undoubtedly come under fire. He needs to state that without the investment in the economy he oversaw there would have been a risk of plunging back into recession. Since invoking fear is often a good tool, the 1920s depression can be used as an example of the potential result of quick austerity and lack of government action in times of recession. Personally, I'd argue against Obama's Keynesian economics, but let's not let that get in the way of electoral strategy.

Similarly, he also needs to stand by his State of the Union defence of investment in infrastructure and transport, highlighting that this will not only ensure better transport links and services for people, but will provide a long-term platform for businesses to expand and economic growth, meaning more jobs. If the Republican candidate opposes and argues against such measures, they can be portrayed as short-sighted and as putting politics before long-term growth and success.

Aside from the economy and budget, I suspect that another key issue is going to be wars and conflict. Iraq is winding down and troops withdrawals are scheduled, but Afghanistan is ongoing, and now the USA has opened up a whole new can of worms by getting involved in Libya.

Regarding Libya, what was intended as a UN-imposed no fly zone to prevent Gaddafi killing his citizens is now shifting into what is going to be a long and drawn out war which lasts until Gaddafi leaves power, whether through choice or through force. Obama can no longer portray himself as being an unwilling participant who has only allowed American involvement to protect Libyan people. The moment he signed the agreement with Cameron and Sarkozy stating that they would not stop until Gaddafi is gone, he burnt his bridges and now must be prepared to defend what he's waded into. I'm predicting Libya is going to become another Iraq, with the Western interventionists being dragged into this for the long-haul and potentially into a lengthy and bloody battle. It can therefore be difficult to spin in electoral strategy.

Focusing on the morality of the intervention is probably the way to go, and more importantly pointing out that there are no American troops on the ground; the USA is only acting as part of group of 12 NATO nations enforcing the UN no fly resolution. Immediately, then, he can highlight differences between this and Iraq; unlike Iraq, action in Libya has UN backing and can be seen as justified by international law, moreover, the US has allies with her in Libya, whereas in Iraq she effectively only had the UK backing her up. However, mission creep has already kicked in. The UN resolution was not about removing Gaddafi from power, and by stating that the US will not stop until he's gone, he's escalated the no fly zone into a fully-fledged regime change mission. With Iraq and Afghanistan already significantly unpopular - especially in a time of budget cuts - if the US is still in Libya by the time of the election, it could be a real issue for him. Some analysts are predicting that Obama will be able to avoid such issues by refusing to allow troops to be sent in on the ground. I'm less confident of this, and will put money on there being American troops on Libyan soil by the time of the election. (Only a small amount of money, mind you - I don't like risks.)

Foreign intervention is always contentious and difficult to find a way of making it palatable to everyone. Liberals are already likely sceptical, and may be as cynical as me in pointing out that there are other dangerous, murderous, oppressive dictators who we leave well alone. North Korea for example, is an oppressive regime which make the lives of their citizens hell through such measures as using concentration camps, severely limiting the freedom of their people, is almost certainly creating WMDs, and even attacked the South Korean island of Yeonpyeong, resulting in the deaths of two civilians. If there was ever a nation which we should apply the doctrine of intervention to, it's North Korea. We don't - perhaps because there are fewer useful things we can get out of it. After all that, it may come as a surprise that I support the action in Libya, but I and other sceptics won't necessarily buy into the explanation that it was a humanitarian disaster in Libya and it was the USA's moral duty to act. (My scepticism of Western motives doesn't mean I'll let you call me a liberal - I refuse to be defined as part of their whingey, anti-business, hypocritical, control freak, pro-government gang.)

Nevertheless, there are some ways people can be less dissatisfied with what's going on in Libya. Obama can contrast the UN-backed Libya operation with the probably-illegal Iraq operation. Also, if in the unlikely event that ground troops haven't been committed to Libya by the time of the election, he can make the pledge that he will not do so. Electorally, it doesn't matter if he later rescinds on that pledge - he's not going to be up for election again. Considering he's already broken past pledges on such things as saying he wouldn't use signing statements, there's no reason to think Obama has any moral qualms with making promises he doesn't plan on keeping.

The final issue which I think will be big in the 2012 election is immigration - especially illegal immigration. As the Republicans have had a general rightwards shift, I'm expecting that their candidate - whoever it turns out to be - will pledge a clampdown on illegal immigration and potentially reducing general immigration. Moreover, it's become clear that race and nationality are still issues, made most obvious by the obsession with Obama's birth certificate, with Donald Trump having hired a task force to determine whether or not Obama is a legal citizen. In part, this will work in Obama's favour. I think it is only a minority of obsessive, potentially racist, Republicans who actually care about this birth certificate stuff. Most of nation accepts him as a legitimate citizen and have bigger issues to worry about. At any rate, it's not worth Obama's time trying to win the votes of the kind of people who long for his deportation.

Therefore, the strategy he needs to use here is one of moderation and centre-ground politics. He needs to espouse the positives of immigration for the economy and business, whilst accepting the need for limitations. I suspect a good tactic to pull the rug from under the GOP candidate would be to commit to funding a project along the Mexican border to reduce illegal immigration, such as extending the existing fencing. Whilst this would help to win votes from Republicans, it risks losing support from the Hispanic community, who traditionally turn away to some extent from candidate who speak of stemming the tide of immigration from Mexico. Given that 67% of Hispanics voted for Obama in 2008 and they make up over 16% of the population, this isn't an area of support he can afford to alienate. Therefore, it's a difficult line to tread. I would go for a centre ground proposal of cutting down on illegal immigration whilst fervently defending the DREAM Act. This legislation, which was blocked by the Republicans in the Senate, would give existing  young illegal immigrants an earned path to citizenship. Even speaking as a sceptic who often argues against immigration, the legislation is actually pretty decent and I would have thought Obama continuing to come out in full support of it would help his support with minorities as well as moderates. Regarding the tougher measures against illegal immigration, the angle of defending American workers from cheap labour could be used, and given that Hispanics are on average lower paid, this could potentially even be used as a tactic to avoid alienating the voter group.

The final hot-button issue (there are so many Americanisms in post I may as well just emigrate) is going to be healthcare and healthcare reform. I've left it till last because I don't know how to formulate a strategy to deal with it; this part is a thinking aloud exercise.

I suppose the first thing is to get the priorities for the defence of the healthcare campaign sorted. To the left is a map from NPR showing the rate of uninsured people by state. The darkest states have the highest number of uninsured residents. In the states with high numbers of uninsured people, there's potential to use healthcare reform as a campaign plus point, rather than having to be on the defensive about it. So in such states as Texas, New Mexico, and Idaho, he can reach out to the poor and explain to them how they're going to be helped by the government's legislation to ensure they get health insurance coverage, and preventing companies from turning them down even if they have pre-existing conditions.

However, I also recognise that some of these states have a strong Republican leaning, such as Texas. Therefore, we can drill deeper, getting campaigners and volunteers to focus on healthcare in the areas with the greatest number of uninsured people. Campaign material and literature could also be tailored to these areas - so a suburban congressional district with a low number of uninsured people would not receive anything about the benefits of the healthcare reform legislation, whilst the inner-city impoverished districts would have it more heavily pushed in the leaflets they receive and from the people who knock at their door. Moreover, the campaign can also focus specifically on the swing districts. These are the Congressional districts, but they're indicative of the areas in which people are likely to switch their vote and need to be focused on in order to reduce the risk of losing their support.

In order to help tackle some of the concerns about the cost of the reform legislation, it can be pointed out that it is projected to save money in the long-run. The Budget Office has predicted that the healthcare reform measures, far from increasing the deficit, will actually reduce it by up to $1.2 trillion. Don't ask me how - I don't know. But if the claim has got any merit, then it's certainly worth using it to counter GOP claims of it being costly.

Finally there's the old tugging at the heartstrings tactic. I think the days of traditional Democrat policy have long gone. There's been a shift among the public and among politicians. No longer can Democrats pursue their traditional attempt to build up welfare and get people to support it by espousing the concept of community and helping those less fortunate. Humanity is in general more selfish and cynical these days. We aren't too interested in seeing our tax money going into more welfare for the least well off, or providing insurance for those who don't have it. (There's a superb documentary on this subject which I highly, highly recommend The Century of the Self - Eight People Sipping Wine in Kettering). I'm not complaining about this change in attitude; but Obama must work with it. Tell people why it benefits them and their children, what they will get out of the reforms, not what the poorest will get out of it. In a time of budget cuts, you're not going to win an election by telling people that healthcare reform is good for the poorest, but offers them no-one. Of course, there's little scope to spin it as being good for the comfortably wealthy - they can afford healthcare coverage and even if they fall on tough times, they've probably got enough money to continue to make the payments. The angle Obama needs to take is that reassuring people that they can no longer be denied coverage on the basis of having a pre-existing condition. Tell them that if they fall on hard times, they're going to get help. Tug at the heartstrings by telling them that their children will no longer be denied coverage if they fall ill, that if they have asthma Big Pharma can no longer tell them they can't be covered. For conservatives and pro-life voters, it can be pointed out that the legislation does not allow for taxpayer funds to be used for abortions. In that sense, it's a bit ironic that a concession in Congress could help him to win the election.


So can he win? Yes, but it's not going to be easy. It's looking more and more likely, though, that he's going to be the lesser of two evils. I'll do an article in the future where I assess how I think the Republican candidate can win, so there's something to look forwards to, eh?

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