Following a bipartisan brunch hosted by the Daily Beast in partnership with Credit Suisse, The Financialist explores the possibility that the next four years could soften the hyper-partisan dynamics in Washington that have led to gridlock, frustration and a loss of faith on the part of the American public.
Vitriol in Washington has gotten so bitter that the word partisan no longer effectively describes the sniping between Republicans and Democrats. Commentators now bemoan a new “hyper-partisan” brand of politics that has descended into little more than name-calling and obstructionism. Now, with the United States in need of decisive leadership to deal with serious fiscal issues, many are wondering whether polarization has finally peaked – and whether both political parties might be ready at last to meet in the center.
Of course, anyone who has lived through the last four years might not even remember what bipartisanship looks like. Republicans were incensed at what they saw as Democratic bulldozer tactics to push the much-loathed Affordable Care Act through Congress without a single Republican vote as one of the first major acts of President Obama’s first term.
A new low came shortly after that, when U.S. Rep. Joe Wilson, R–S.C., screamed, “You lie!” at the President during his State of the Union speech. Around the midterm elections, Senate Minority Leader Mitch McConnell, R–Ky., declared that his party’s single most important goal was to make Obama a one-term president.
Obama responded with a staunchly left-of-center second inaugural address that seemed to indicate he remains unbowed by his critics. But despite the lingering suspicion between Obama and congressional Republicans, there are signs that both sides may try harder in the next four years to build a consensus on major issues.
“I think the pendulum is swinging back to the center because the Democratic majority wants it, and the Republicans need it,” political pollster John Zogby tells The Financialist.
The Republicans may need to drift toward the center as part of a political survival strategy. The GOP may disagree with the president and his party about the proper size and role of government, but repeated attempts to block Obama’s agenda have failed to win over many people outside the Republican base. Not only did Republicans lose to a vulnerable Obama in November, but they also failed to connect with ”America’s new majority” composed of Hispanics, African Americans, young voters and the creative class, says Zogby. Women – especially single women – also heavily favored Obama in the presidential election.
House Majority Leader Eric Cantor, R-Va., recently admitted as much when he told House Republicans assembled in historic Williamsburg, Va., that they must move beyond the politics of debt that has been the linchpin of Republican strategy over the past four years.
“We are in a town run by Democrats, and we cannot win the hearts and minds of Americans if we are just talking about numbers, day in and day out,” Cantor said, according to the New York Times.
Cantor’s shifting stance and recent comments by Louisiana Gov. Bobby Jindal urging the Republican Party to “stop being the stupid party” indicate that the GOP may reach across the aisle on key issues such as immigration in the future. Already, a group of six Republican and Democratic senators are crafting a comprehensive immigration reform package that would create a path to “earned legalization” for immigrants living illegally in the United States.
Tax reform, particularly changes to the corporate tax rate, is another area where Democrats and Republicans could work together, says Donald Marron, the director of the Urban-Brookings Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution.
“In the recent presidential election, both candidates proposed substantial cuts in corporate tax rates,” Marron tells The Financialist in an email. “President Obama proposed lowering the rate from 35 percent to 28 percent… while Governor Romney proposed going to 25 percent.”
Marron is even optimistic that Republicans and Democrats could eventually come together on divisive issues such as climate change and energy.
“Looking further ahead, a day may come when Republicans and Democrats could work together on a carbon tax or similar policy that combines fiscal and environmental policy,” he explains. “Our elected leaders aren’t remotely there yet, but policy analysts from the left, right, and center are laying the intellectual groundwork for future policy consideration.”
Each of these issues underscores the potent economic argument for bipartisanship. The 2011 debt ceiling deal increased U.S. borrowing costs by a relatively modest $1.3 billion, but the uncertainty engendered by the bruising political fight likely cost the economy much more. Likewise, both supporters and detractors tend to argue about immigration reform in moral terms, but some studies claim an overhaul of immigration policy could add $1.5 trillion to domestic GDP over the next decade.
Meanwhile, the electorate remains decidedly centrist, as shown by a Zogby Analytics poll released last week in which a greater proportion of respondents (41 percent) described themselves as moderate than either liberal (24 percent) or conservative (35 percent).
“The hyper-partisanship plays to the fringes and forgets the middle,” Zogby explains, adding that electoral victories are built in the center – not on the fringes.
Therefore, a race to the middle may be both good economic policy and a critical political strategy for both parties.