JACK SPENCER: Illusion vs reality in 2012

Understanding of economic reality will only happen when it affects us

 

Michigan’s political landscape in 2012 was dominated by the battle between the unions and the Republicans. In the wake of the 2011 reforms, some sort of union backlash was virtually guaranteed. With 2012 being a presidential election year, the time was right for the unions to take their best shot. They took it — and they lost.

It’s likely the fight will continue at lower levels in 2013 and beyond.

After signing the right-to-work law, Gov. Rick Snyder, right, speaks at a news conference in Lansing. (Courtesy Photo)

Now, with 20-20 hindsight, it’s obvious that the goals of Gov. Rick Snyder were sure to clash with those of the unions. Now, looking back, it would have been foolish to bet that a political war could have been avoided.

When Snyder became governor in 2011 his mission was to re-invent Michigan. A huge part of this involved putting government at both the state and local levels on a sound economic footing. In Michigan, the biggest obstacle to reclaiming fiscal responsibility has been government unions.

Like all wars, political wars tend to lead into regions neither side fully envisions. A year ago it wasn’t inevitable that Michigan would become a Right To Work state. But it was inevitable that in 2012 one side or the other would lose — and lose big.

Michigan is a microcosm of what’s taking place nationally. It all centers on the gulf between two visions of government and economics. Unions in Michigan reflect the liberal view that ultimately governments are powerful enough to sidestep economic laws.

This is a primary difference between liberals and conservatives. In fact, it might be the core difference.

Unfortunately, these two views are usually misrepresented. We’re told that liberals believe government should do more. Conversely, we’re told that conservatives believe government should do less. An explanation of this type only masks the real disagreement.

Conservatives believe government “cannot” do most of the things it promises. It’s not a question of should or shouldn’t — it’s a question of capability. At the end of the day, no government can outflank, outwit or overpower economic laws.

A government can, however, delay — often for a very long time — the day of economic reckoning. This ability to delay often creates the illusion that government has actually evaded economic laws. It is a very enticing, some might say “addicting” illusion.

But in the end, economic laws are inescapable. They are as real as the law of gravity. What’s more, the longer facing up to economic reality is delayed, the worse and more widespread the consequences will be. Delay causes more people to be hurt — not less. Attempting to avoid these dire consequences is the true “compassionate” side of conservatism.

This is not an easy message to convey in a 30-second election ad. That’s why so many conservative candidates have to rely on voters already knowing the economic facts of life. But many voters know little about history and even less about economics. Convincing such voters is virtually impossible.

This brings us to the 2012 presidential election.

At the beginning of 2012, most conservatives expected the presidential election to be a referendum on President Barack Obama. With this in mind, it was believed that any of the last three Republican contenders – Newt Gingrich, Mitt Romney, or Rick Santorum — stood a good chance of winning.

In the end it was a referendum on Obama, but the outcome wasn’t what had been hoped for by conservatives. Basically, the verdict — decided upon by those who voted and those who didn’t vote — was that “things aren’t so bad.”

All of the forecasts of widespread economic distress, didn’t mean much to millions of American voters. Even with high unemployment and massive deficits, most people in this county remain relatively comfortable.

Historically, a majority of voters seldom react to predictions of future troubled times. Economic concepts, such as huge deficits are very abstract ideas to millions of voters. If they don’t feel it personally, it rarely affects them. So when all the votes had been counted, fewer people were fed up with Obama than the conservatives had anticipated.

The Romney campaign ran on the assumption that the referendum on Obama would be a resounding thumbs down. It spoke of tough economic times as though most voters were “feeling the pain” and would automatically blame Obama. But much of the pain may be yet to come.

Like it or not, elections do reflect the collective will of a nation. In 2012, the illusion that our national government can evade economic reality carried the day.

It’s interesting that the nation appears to be on two opposing tracks. For unions, 2012 was a very rough year. They suffered huge setbacks in traditional union states. Wisconsin and Michigan were just the most talked about examples. Meanwhile, the union-friendly Democrats did well nationally.

It seems that closer to home, at the state level — and especially the local level — economic realities register with the voters. Nationally, they don’t. Somehow, a city’s $10 million deficit is more easily identified as a threat than the nation being trillions of dollars in debt.

Though frightening, this disconnect might be understandable.

For decades voters have heard about the national debt — expressed in 100’s of billions of dollars. Yet, they’ve never really felt an impact. What the 2012 election revealed is that many Americans will only understand economic reality when they actually start to feel its effects.

They might start feeling the effects of the national economic dilemma very soon. Then again, maybe not.

If 2012 taught us anything, it’s that predicting what going to happen is a dicey business. Virtually everyone and their Aunt Lillian thought the Supreme Court would declare Obamacare unconstitutional. But it didn’t. Almost no one foresaw the year ending with Michigan becoming a Right To Work state. But it did.

Who knows? Maybe President Obama will rise to the occasion. American history is full of examples where leaders came through when faced with their stiffest tests.

However, if worse comes to worst, we can only hope the resulting disillusionment will be a healthy one.

 

Jack Spencer is Capitol Affairs Specialist for Capitol Confidential, an online newsletter associated with the Mackinac Center for Public Policy (MCPP). MCPP provides policy analysis. The political analysis represented in this column does not necessarily reflect the views of the Mackinac Center.

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