Congress

Republicans Should Fear Bad Tax Policy, Not Bad Polls

Lawmakers will pay a heavy electoral price if they pass a plan that doesn't help the economy.

Decisions, decisions.

Photographer: Saul Loeb/AFP/Getty Images

The Republican tax bill was already polling badly before we had an actual bill. If anything, it's probably going to poll even worse now. Enemies of the bill will cheer that, of course. But it shouldn't matter to Republicans deciding to support or oppose the measure.

Cutting taxes on rich people always polls badly, and this bill certainly does that. Republicans may wish that they could convince people that trickle-down effects are real -- that cutting corporate tax rates will create prosperity and jobs -- but very few voters pay enough attention to political rhetoric to get convinced by complex arguments, and those who do pay enough attention are mostly partisans who will (more or less) just accept whatever their side tells them. The exception might be when there's an elite consensus in favor of a complex argument, but that's obviously not going to be the case with the Republican tax bill. Democrats and many neutral experts believe the Republican tax arguments are hogwash.

Making poll matters worse is President Donald Trump, who is unpopular. So are Paul Ryan, Mitch McConnell, and Republicans in Congress in general. Therefore, anything they do is going to be less popular than if it wasn't associated with unpopular politicians. 1 Beyond that is the "thermostat" effect in public opinion, in which public opinion as expressed through surveys grows more conservative when Democrats hold the White House, and more liberal when Republicans do. Just by winning the presidency, Republicans make their kind of tax cuts less popular. Just as the kinds of health-care reform Democrats like was far more popular when George W. Bush and Donald Trump were president than when Bill Clinton and Barack Obama were in office.  

Then there's the bill itself, which repeals or limits a lot of things in order to partially pay for lowering corporate and personal rates. That's going to hurt the bill's popularity in part because people in general are risk-averse and often suspicious of changing the status quo. People and groups specifically hurt by these provisions will, of course, be far more suspicious. Losing popular deductions such as medical expenses or interest on student loans is easy to understand and for opponents to talk about -- and the interests involved will be sure to to frame their objections around such things.

So what should Republicans do with their unpopular bill?

The truth is that policy decisions such as this one rarely have strong direct effects on future elections. Of course, even a very small effect could make the difference between winning and losing, but it's usually hard to show such effects exist. 2 But overall it's just not that likely it will make a huge difference. And that applies both to the downside of passing an unpopular bill and the presumed downside of failing to pass a Republican priority.  

So everything comes down to a fairly basic question: Do Republican lawmakers honestly think the bill will be sound public policy -- that it will actually help the economy and otherwise be good for their constituents? Every tweet, every fierce clash on CNN, every critical editorial, every attack ad: They pale in comparison to the sheer force of an economy that is growing when voters go to the polls. It's the one thing that most reliably earns electoral rewards (as long as the effects happen when Republicans are still in office). 3  

Conversely, if Republicans don't think it's good policy, they should probably oppose it. And in deciding what they think, they should pay close attention to their districts, where organized groups normally have a good sense of whether legislation is likely to work for them or against them. Members of Congress are wise to believe that good policy will usually make good politics no matter what the polls say -- and foolish if they ignore their districts when trying to make a decision as big as this one.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
  1. Yes, many Democrats are unpopular as well, but that's mostly irrelevant here; it's the Republicans who are in office and pushing this plan, and that's what will affect public opinion of it.

  2. Most studies by election scholars on the effects of passage of the Affordable Care Act did show that it cost Democrats seats in 2010. I remain skeptical of those studies; they can't take into account the likely effects of Republicans demonizing some other bill or action if they hadn't had Obamacare to kick around. But my account therefore differs somewhat, although not radically, from what many (very smart) political scientists believe.

  3. Beyond electoral effects, it's also true as many Democrats said about health care after the 2010 elections: One of the main points of winning office is to enact the policies that a party believes will improve the nation. And yet another reason is that policies that work are the policies that tend to resist change in the future -- as Republicans discovered when they wanted to eliminate the Affordable Care Act.

To contact the author of this story:
Jonathan Bernstein at jbernstein62@bloomberg.net

To contact the editor responsible for this story:
Mike Nizza at mnizza3@bloomberg.net

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