The Magazine

A Very Beatable President

But the GOP can still blow it.

Dec 26, 2011, Vol. 17, No. 15 • By JAY COST
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The reason is reducible to a simple calculation of costs and benefits. The president and his allies in Congress advertised their bill as a cost-reduction package, framing it as a win-win-win: People without insurance would get coverage, people with insurance would see their premiums reduced, and taxpayers would eventually enjoy a lower bill for it all.

However, this argument was a smokescreen. Obamacare focuses almost entirely on coverage expansion. The cost-reducing mechanisms are either very weak, politically impractical, or will eventually hit the middle class square in the jaw. The bill is in fact a win-lose-lose: Those without insurance definitely win, but only because of a transfer of wealth from people with insurance as well as from taxpayers.

Since most Americans already have insurance, this establishes an easy goal for the Republican nominee: Convince the average American that he will be worse off because of the bill. This should not be a difficult task. Credible, nonpartisan reports, many from government agencies, spell out in great detail how millions of Americans will be made worse off by Obamacare. What’s more, Obamacare continues to poll very poorly, mainly because of the messy process that produced it. Most Americans believe that the political system is broken, and that the effort of congressional Democrats in 2009-2010 to pass Obamacare is the prime example of what’s going wrong in Washington. Thus, it should be relatively easy for the GOP to convince voters they are bound to lose because bad process produces bad policy.

The final issue Obama will confront is the deficit. Like the economy, this is an issue that Obama owns politically, even if he is only partly responsible for it. Reduced tax revenues and greater demand for social welfare programs make deficits boom in a recession. And the long-term deficit is almost entirely a function of the runaway cost of Medicare.

Still, the president is politically vulnerable for good reason: He never really tried to forge a bipartisan coalition to tackle deficit reduction. His own deficit commission offered him a sensible, bipartisan plan—the “Simpson-Bowles” plan—that he summarily rejected.

And make no mistake: The deficit is a powerful political issue. The federal budget is massively complex—Rep. Paul Ryan and a handful of wonks at the Congressional Budget Office might be the only people in the country who begin to understand it. Yet most people grasp that money borrowed by the federal government must one day be paid back, with interest, by the taxpayer. Thus, as with health care, the Republican job on the deficit will come down to convincing voters that their intuitions are correct: They are losers because Obama raided the Treasury to pay off Democratic client groups, leaving the average taxpayer to foot the bill.

All in all, this election will be fought more on bread-and-butter issues than any since at least 1992. Ronald Reagan’s question to the nation in the final debate against Jimmy Carter—“Are you better off today than you were four years ago?”—will be the GOP’s mantra in 2012. The answer is obviously no, and the Republicans will use the economy, Obamacare, and the deficit to pin the blame squarely on the president.

How will the Obama team counter? The Obama campaign has already telegraphed its strategy for 2012, and it is worth reviewing in some detail, beginning with the demographics of the electorate. Obama’s election in 2008 depended largely on an unprecedented haul among nonwhite voters, and Obama’s campaign gurus believe that demography can trump economics in the Mountain West swing states of Arizona, Colorado, Nevada, and New Mexico as well as the “New South” states of Florida, North Carolina, and Virginia. Additionally, they are counting on another monumental haul from the youth vote, hoping that massive turnout at colleges like Ohio State and the University of Michigan will keep those important Rust Belt states in the Democratic column.

There is little doubt that Barack Obama will win a majority of the non-white vote and the young next year. Even so, the president and his team are being wildly optimistic (assuming they believe their own spin). For starters, large majorities among minorities and kids are built into every Democratic candidate’s campaign. Obama cannot just win these groups; he has to win them by such overwhelming margins that they cover his massive losses among older white voters.

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