Could Obama Have Gotten More Stimulus By Abandoning Health Reform?

A blog about business and economics.
June 7 2012 1:37 PM

Could Obama Have Gotten More Stimulus By Abandoning Health Reform?

Ezra Klein and Kevin Drum say no, but I'm not sure the evidence they point to really answers the question.

A different way to think about it is in terms of LBJ and Harry Byrd. One of Johnson's first acts as president was to order his staff to abandon the Kennedy Administration's fight with Senator Harry Byrd of Virginia over the size of the federal government. He told them to just abjectly surrender to Byrd and agree to arbitrary cuts. In exchange for agreeing to arbitrary budget cuts, Byrd was willing to agree to a tax cut bill that the administration's economist (and many liberal members of congress) thought would boost the economy. Then with the tax cut bill passed, a filibuster of civil rights legislation was no longer also holding up the tax bill which was important to keeping the "pro" side together throughout an extended debate.

Advertisement

The right question about health care and stimulus, in other words, isn't whether "focusing on jobs" would have had some magical impact on the Congress to induce them to pass a stimulus bill. The question is whether some concrete logroll was available in which some members of Congress would have been willing to back a stimulus bill in exchange for Obama abandoning universal health care.

Now to the best of my knowledge no offer even remotely resembling that was on the table. But by the same token, to the best of my knowledge nobody in the White House attempted to explore anything like that. If you look at the now-infamous Romer/Bernstein stimulus chart, one of the things that pops out at you is that the administration believed in 2009 that powerful equilibriating forces would push the economy back to full employment fairly rapidly even in the absence of any stimulus at all. The point of stimulative policies was to cushion the blow, but they expected full employment conditions to return by 2013 one way or another. Paul Krugman said at the time that this was too optimistic, but there's every reason to believe the administration believed that was an accurat forecast. Operating within that framework, abandoning longstanding policy objectives in order to obtain extra stimulus would have been pretty ridiculous. So nobody on the Hill or in the White House explored the issue.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

TODAY IN SLATE

Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Students Aren’t Going to College Football Games as Much Anymore

And schools are getting worried.

Two Damn Good, Very Different Movies About Soldiers Returning From War

The XX Factor

Lifetime Didn’t Think the Steubenville Rape Case Was Dramatic Enough

So they added a little self-immolation.

Politics

Blacks Don’t Have a Corporal Punishment Problem

Americans do. But when blacks exhibit the same behaviors as others, it becomes part of a greater black pathology. 

Why a Sketch of Chelsea Manning Is Stirring Up Controversy

How Worried Should Poland, the Baltic States, and Georgia Be About a Russian Invasion?

Trending News Channel
Sept. 19 2014 1:11 PM Watch Flashes of Lightning Created in a Lab  
  News & Politics
Weigel
Sept. 20 2014 11:13 AM -30-
  Business
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
  Life
Quora
Sept. 20 2014 7:27 AM How Do Plants Grow Aboard the International Space Station?
  Double X
The XX Factor
Sept. 19 2014 11:33 AM Planned Parenthood Is About to Make It a Lot Easier to Get Birth Control
  Slate Plus
Slate Picks
Sept. 19 2014 12:00 PM What Happened at Slate This Week? The Slatest editor tells us to read well-informed skepticism, media criticism, and more.
  Arts
Brow Beat
Sept. 20 2014 3:21 PM “The More You Know (About Black People)” Uses Very Funny PSAs to Condemn Black Stereotypes
  Technology
Future Tense
Sept. 19 2014 5:03 PM White House Chief Information Officer Will Run U.S. Ebola Response
  Health & Science
Bad Astronomy
Sept. 21 2014 8:00 AM An Astronaut’s Guided Video Tour of Earth
  Sports
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.