The Deficit and the Election
When Mondale lost, carrying only the District of Columbia and his home state of Minnesota, many aspects of Reagan's victory, especially his large margin among eighteen- to twenty-four-year-old voters, suggested that the long-awaited partisan realignment might follow.[24] Except for blacks and Jews (and maybe Norwegians), no group from 1980 swung toward the Democratic column. The Democrats' advantage in party identification narrowed dramatically, as Republicans seized back the advantage (won in 1981, lost in 1982) as the party of prosperity.[25] The themes of 1980's recriminations and of the Yellow and the Blue books—that the party had to embrace new ideas, avoid being tagged as spenders, and emphasize prosperity instead of redistribution—once more echoed across the pages of the nation's press.
The threatened realignment made Democrats so nervous they took the tax hike almost entirely off their public agenda. "If he wants taxes," Tony Coelho summed up their sentiment, "Mr. Reagan will have to plead with the American people for higher taxes." An ironic consequence of the election, therefore, was that the Senate GOP was left more isolated than before; instead of hoping to get the House to join with them against the president, in 1985 they first would have to win over their president, lacking a credible threat to proceed without him. A weak position.
Although most politicians took the election as a mandate against something—tax hikes—they did not believe that Reagan had a mandate for anything in particular. Polling data analyzed by Warren Miller and Merrill Shanks suggests that the electorate felt Reagan had been too conservative (in giving too little to welfare and too much to defense) but, because times were better, they reelected him anyway.[26] The president's reelection campaign had done nothing to convince politicians that voters who chose Reagan were voting to cut domestic programs. Chief of Staff James Baker declared that "it was a victory for [Reagan's] philosophy and a victory for him personally, but I'm not sitting here claiming it's a big mandate."[27]
Reagan himself did not believe that policy success in a second term required explicitly endorsing those policies. Thus, at the beginning of 1984 he had this exchange with a Newsweek interviewer:
Q : What's different about a second term?
A : In the first term [in California] we laid the groundwork for the great comprehensive welfare reforms that were unlike anything that had been done any place in this country before. I never mentioned them in the campaign for reelection. Never made them an issue, never held them up as something to look forward to. I didn't want to politicize it. And
immediately after the election, we went to work on them, and we achieved them.
Q : Is there a parallel here? Do you feel that in a second term you will be able to do something about the runaway cost of entitlements?
A : I believe there have to be some structural changes in our government…. And this is part of the getting at the deficit problem over the long haul that I look forward to doing.[28]
Reagan certainly did not campaign on the issue of controlling entitlements. The presidential election sent no message about dealing with the deficit, save that a tax hike would be politically unwise.
If the congressional election sent any message, it was an endorsement of the status quo. To regain control of the House, the GOP needed to regain almost all the twenty-six seats lost in 1982. Instead they won only fifteen, and their ideological gain was more like ten seats. Democrats, moreover, gained two seats in the Senate. Since the development of a stable two-party system, no president had emerged from his election with a smaller portion of partisans among the representatives.[29]
The voters loved Reagan but gave him a Congress that had little desire to endorse his policies. The most probable explanations for this election result include the many advantages of incumbency, good times that eliminate the impulse to "throw the bums out,"[30] and the undoubted advantage that control of state legislatures, especially in California, gave Democrats in creative redistricting. There was also some evidence to back up John Ferejohn and Morris Fiorina's suggestion that "a large majority feels hesitant to trust either party with full control over the government."[31] That is, maybe the public wanted budget and overall political stalemate or at least preferred it to any alternatives.
The public's choice of officeholders maintained the stalemate. Opinion data in 1984 told two other stories: first, the structure of opinion that constrained policy changes remained; second, the deficit, though a concern, did not dominate public opinion the way it dominated policy debate in Washington.
We already know that the public saw budget deficits as very bad, so much so that people overwhelmingly supported the balanced-budget amendment. The political question is the salience of a particular problem—how many people care how deeply about it. One index is Gallup's recurrent polling of what people consider the "most important problem" facing the country. On that subject, the deficit (or excessive spending) figured as a pretty minor item in the polls, never above 5 percent until 1984. For much of this period Reagan's budget cuts were cited by about the same percentage. In February 1984, however, the deficit jumped up to "most important problem" designation for 12 percent of respondents.
Gallup's time series on this question shows that throughout this period
citizens' economic problems were far more important than the deficit. As inflation declined and unemployment increased, concern shifted to the latter. As unemployment then began to decline, foreign policy (perhaps spurred by events in Lebanon and elsewhere) sparked concern. The 1984 rise in worry (to still unimpressive levels) about the deficit, therefore, suggests not alarm so much as that slightly more than a tenth of the public felt happy enough with trends on more important issues to see the deficit as the most important problem.
This analysis of the deficit issue's marginality is supported by other data from Gallup's February 1984 poll. When asked if they approved the president's handling of his job, the public did so by a 55 percent to 36 percent margin. Reagan's worst rating—even worse than on Lebanon—was on the deficit. In an April 1984 poll, voters were asked, "Regardless of your own political views, what would you give as the best reason for voting against President Reagan?" The deficits ranked ninth, at 4 percent, far behind foreign policy (21 percent) and fairness (18 percent), less even than his age (8 percent) and distributional concerns about cuts in social programs (5 percent) or excess defense spending (5 percent). In other words, he had botched the deficit, but it did not matter too much.
The next question is, what was the public willing to do about those deficits? Throughout our history we have shown that public opinion expressed skepticism of tax cuts if it meant increasing the deficit. Even in 1983, at the height of a recession, during which people could easily claim they needed help, "narrow majorities," as William Schneider summarizes the data, were "willing to postpone or even cancel the third year of Reagan's income tax cut." But these very same people were unwilling to pay more than they already were. An early 1983 Roper poll had shown, for instance, that five respondents would rather live with the deficit for every three who would pay higher taxes to bring it down.[32] If offered other options, people overwhelmingly chose to avoid tax increases. Indeed, once they received the final installment of the tax cut, few would willingly give it back . Just as it is harder to cut benefits than to prevent their improvement, convincing people to forego a tax cut is much easier than persuading them to pay more. The politics of taxes and the deficit therefore passed a crucial threshold on July 1, 1983. Once people had the money, concern about the deficit, absent bad economic conditions tied to the deficit, would not convince them to give it back.
So far public opinion was all good news for Reagan; now comes the bad part. Like Congress, the public was more interested in cutting defense, though not drastically, than in reducing social spending. The public's opinion of domestic spending depended on its description. Support for "maintaining cost-of-living increases in social security benefits" and
opposition to cuts in entitlement programs remained overwhelming—around eight to one—throughout this period.[33] At the end of the campaign increased spending for social programs was favored by a three to one margin.[34] Twice as many election-day respondents favored more rather than less spending on the poor (no one asked how much they were personally willing to pay). Yet voters also worried more that some people who did not deserve welfare might get it than that some who deserved it might do without.[35]
Each major political faction, therefore, was out of step with the public in some major way. The public rejected Reagan's desire to reallocate money from social to defense spending, House Democrats' desire to raise taxes, and Senate Republicans' desire to do lots of unpleasant and unpopular things to repair a deficit about which they cared far more than did most people. Yet the overall policy—worry about, but don't take much action on, the deficit—was pretty close to public preference.
Both Reagan's month-to-month job approval rating and his final margin in the election were strongly related to economic conditions. "In short," says Scott Keeter, "Reagan succeeded in accomplishing what most government heads try to do, and that is to have the cyclical upswing of the economy coincide with the latter part of an election year."[36] Election day polls showed that approval of the economy's performance was easily the largest element of Reagan's support. Both improved personal finances and hope for the economy as a whole contributed to Reagan's landslide.[37]
The deficit issue helped Mondale very little. In the end, exit polls showed that between 14 and 25 percent of voters were influenced by the deficit, and that they split fairly evenly between Mondale and Reagan. Thus, the issue helped Mondale but nowhere near enough to justify his effort.[38] In fact, if we combine deficit reduction with the tax issue, Mondale's stance was clearly unpopular. The Los Angeles Times poll reported that the 17 percent of voters who named taxes an important issue voted for Reagan by 80 to 20 percent. Although not all people who opposed a tax increase would have voted for Mondale in any case, the tax proposal only hurt his chances at election.
The Democrats were left committed to a position on a fundamentally Republican issue. Both ABC and Los Angeles Times polls showed that people who worried about the deficit marginally favored Mondale. But the larger number, who emphasized either taxes or government spending, favored Reagan by more than four to one. Many Democrats, especially politicians, now had reasons to dislike deficits. But the real, visceral deficit haters are in that large group who object to government spending and who share Reagan's belief that deficits mean excessive spending.
"I keep pointing out that that's the problem," said Maine Democratic Senator George J. Mitchell. "There's no pressure on Reagan to do anything [about deficits] because most people who are concerned are Republicans who are going to vote for him anyway."[39]
Mondale tried to make the deficit an argument for unease about the economy. It didn't work because it's hard to convince people to pay something now (e.g., taxes) for an uncertain future reward. The epitaph for the Democrats' use of the deficit in the 1984 presidential campaign was pronounced by a student in Youngstown, Ohio: "I have a personal debt, and I can't afford taxes being raised," he explained. "The national debt might hit me later in life but I've got to put bread on the table right now."[40]