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Tyler Cowen and Ezra Klein on Palin’s Speech and What Obama and McCain Would Each Accomplish — or Not — As President

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Every day until November 4, a series of writers and thinkers will discuss the election over instant messenger for nymag.com. For today’s conversation, we bring together Tyler Cowen, a professor of economics at George Mason University who blogs at MarginalRevolution.com, and whose latest book is Discover Your Inner Economist: Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist, and The American Prospect’s Ezra Klein. Klein will return tomorrow with Gawker’s Alex Pareene.

T.C.: So, Palin. People are missing one of her long-term implications, namely that she means the libertarian tradition in American politics is making a distinctly nationalist turn, just like Ron Paul. For my taste that is worrying. One of the most striking things in Palin's speech was all the talk of energy independence. That is (a) bad economics from any point of view, and (b) an appeal to blatant nationalism. The left is acquiring more and more of a lock on cosmopolitanism, and, of course, Barack Obama personifies that.

E.K.: I'm actually surprised to see you fit her into the libertarian tradition. She seems more like a Christian nationalist sort, no?

T.C.: She is not a libertarian, in my view. She is a populist. But she is/will be soaking up lots of support that otherwise goes into quasi-libertarian causes. She will be turning those sources increasingly nationalist. Just like many current Ron Paul supporters might have been Ed Clark supporters in 1980, but now [libertarianism] is packaged with more "nativist" ideas.

E.K.: Fair enough. It was odd last night to listen to the amount of anti-government rhetoric on display at the GOP convention. The Republican Party has become so deeply identified with a neo-imperialist stance mixed with post-9/11 nationalism that I rather forgot they were against government action.

T.C.: Not to mention their record on fiscal policy.

E.K.: But before Palin, you had Meg Whitman up there saying something like John McCain believes there is no problem in America that cannot be solved by individual liberty. And I thought to myself: John McCain can't possibly believe that. But it still touches a deep chord amongst conservatives.

T.C.: It also hurt me to hear her criticize Obama for protecting the civil rights of Al Qaeda. The whole point is presumed innocent before judged guilty and the wording of the point made it clear how much that principle has been thrown out of the window. McCain, I think, believes in "honor" and "strong moral character." He then has smart people telling him that homage to market economics goes along with the package. He says to himself: "Hey, I've been a conservative for years. I can do that." He doesn't "not mean it." But he doesn't mean it either. Yesterday I asked Ross Douthat why he is a Republican, but I guess I can't ask you that!

E.K.: Nope. I was actually surprised to hear her attack community activists. It's not that I don't see the utility of the blow, but I've always thought there's something fairly conservative about the vocation, which informally organizes citizens to demand better, fairer, and wiser treatment from detached government bureaucrats.

T.C.: I think the talk about community activists was a kind of veiled poke at elites, or was meant to be. Presumably her church friends are "community organizers" of some kind and she fully approves. It is one of those codes that resonates when applied to one side but not the other. Her version of mentioning a country club.

E.K.: I think it was a rather explicitly racial poke, particularly as Giuliani offered it, but so be it.

T.C.: Your description of Giuliani as an effective attack dog was right on I thought. Naive little me, I thought he would play bad cop and Palin would be all sugar and sweet. Then she shocked us. But basically it worked, best defense is a good offense, and so on. People are still underestimating her, in my view.

E.K.: Think so? I actually expected more from her than I got. Obviously, as a liberal, I'd be expected to say that. But with Giuliani, I really thought he landed solid blows, and put forward a narrative that could genuinely damage Obama. Palin didn't have enough attacks to really harm Obama, didn't have enough arguments to redefine herself, and McCain's brand is already fairly strong. It's twenty hours later, and I can't really remember what she said.

T.C.: Didn't you grow up in California? It depends how much time you have spent in other states. I've spent lots of time in different parts around this country, and my parents came out of a blue-collar background.

E.K.: Her whole speech felt like it was aimed at the news cycle. And yep, I'm one of the coastal elites she hates so much.

T.C.: I think you are viewing her speech too much like how a smart person would. America loved it, and they are talking about little else.

E.K.: Are they? How do we know?

T.C.: One lesson of sociology is that what people take away from a situation is so different from what it may at first seem. People related to her. She was energetic. She seemed to show up her critics, etc. That is what got through.

E.K.: I don't mean this to be contrary, or even liberal. I actually don't think individual speeches matter — even Obama's.

T.C.: I'm telling you, my intuition, I wouldn't suggest I have proof.

E.K.: But my sense is these are forgotten quickly. It's really been striking to me how transient the day's political obsessions are.

T.C: I agree that usually speeches don't matter, but I think this one did. Obama's didn't, especially not in retrospect. It has been forgotten, though not in a bad way.

E.K.: Three weeks ago, I left the country for seven days. When I came back, nothing had changed in the election. Nothing! But before I'd left, it felt like all sorts of things were going on. There was plenty to write about.

T.C.: That's the right attitude, and of course that is what the Ray Fair model implies. I still think Obama is very likely to win. McCain's only chance is that more old people than we think simply will not vote for a black man.

E.K.: My main conclusion has been that it's a huge analytical mistake to pay much attention to politics. But it's also my job, so what're you going to do?

I also think McCain appeals to something fairly deep in people: On some level, it's really amazing Bush beat him in 2000. He's an incredibly interesting individual, and there's an emotional heft to him that has to be taken seriously. If he were able to match it with a compelling vision for the country, I think he'd be almost unstoppable, but his problem is he's utterly uninterested in domestic affairs and it shines through.

T.C.: Unlike you I don't see McCain as such a strong candidate. This may sound superficial, but to lots of people, he just doesn't look like a leader. And the POW stories, while they are effective in some ways, don't actually help his leadership credentials. In a kind of primal way, we don't expect our leaders to talk about their victimhood so much. He has senator written all over him, as I see him. Obama looks presidential. It's just that many people object to exactly that.

E.K.: I agree. No one can gaze into the distance like Obama. He's the most talented distance-gazer possibly ever, and there's no way for Ray Fair's model to possibly account for the power of that. (I'm only half joking. Maybe only a quarter joking.)

T.C: The Fair model (which relates presidential prospects to a small number of variables, most of all the state of the economy), of course, doesn't cover race. But I don't know that distance-gazing helps Obama any more at his current margins. For many people it is a turnoff. Right now I think his support has peaked and he is simply counting on high Democratic turnout based on party primaries. That's probably enough to win, plus a chunk of the independents who are disillusioned with the Republicans.

E.K.: I did a piece on Obama’s economic philosophy awhile back and was really struck by how often his advisers brought up their desire to minimize the amount of hassle people need to put up with from the government.

T.C.: I worry about Congress much more than I do Obama. I believe he genuinely wants to do a good job. That's not coincident with what I want him to do, but it's a start and we've been missing that for a while.

E.K.: Though I think you get into why presidents only matter somewhat here: My hunch is that Obama's economic instincts are actually more "conservative," or at least "libertarian," than McCain's, but McCain isn't interested enough in economics to construct an ideology that's symmetrical to his gut beliefs. While Obama has merged his concerns about government into an appropriately big government framework: You don't need that much administration to do redistribution.

T.C.: I agree Obama is relatively conservative, in the literal sense of that word. I believe his mental goal is to undo half of the increasing income inequality of recent times.

Now, I see the real issue to come is Obama versus Congress, not Republican versus Democrat. I suspect I have a much lower opinion of Congress than you do.

E.K.: Rather the opposite. I bet I have a much lower opinion of the president than you do. I think the primary failure in political reporting is the focus on the presidency. It's totally misleading. But it's easier to construct a narrative around one person than 535. But if you're a domestic-policy guy, like I am, the real problem is Congress, not the president. It's not like no one has tried health reform before.

One of the most frustrating things to me — and it's partly my fault as a writer — is that if you compared the number of liberals with strong feelings on individual mandates to the number who know who Max Baucus is or could identify the Senate Finance Committee, the former would make the latter look like four bearded men and a dog. But Baucus matters! But the Finance Committee is hard to write about!

T.C.: Baucus matters, but keep in mind his identity is endogenous to other forces in the system. Maybe we agree about Congress then. What do you think of Arnold Kling's view that universal coverage would very much hurt the Democrats electorally in the future, by taking the issue off the table?

E.K.: The uninsured don't vote. Social Security is a good counterexample here: I think it's more powerful to say that Republicans are going to destroy this thing you like than that we're going to pass this thing you want. Nobody believes politicians will pass anything, but everyone believes government might take their stuff away.

T.C.: I think an actually implemented Social Security privatization wouldn't look much like what has been on the drawing board and it would end up being a "top off" provision. But I don't expect such policy in any case.

E.K.: Right, my point on Social Security is more that Democrats get more mileage out of protecting it than I'd imagine they'd get out of proposing an enormously expensive pension program for poor people.

But look, if Democrats could pass a maximal version of their agenda and then Republicans got to run the country for a bit as a counterreaction, that's better than Democrats running the country for both periods but getting nothing done. Assuming that Republican rule reverts back to a Bush 41 foreign policy, of course.

T.C.: I don't expect reversion back to Bush 41. I think 9/11 did fundamentally change the world. My prediction is that Obama wins, he does extend health-care coverage in a minimalistic kind of way, he fights a lot with Congress, small tax cuts for lower- and middle-income groups, and those are the benefits he claims for reelection.

E.K.: Depending on how you define minimalistic, I basically agree with that. I think his bigger effect is to provide a template for Democratic foreign-policy leadership.

T.C.: And that is probably exactly the scenario you say you don't prefer. I think Obama really is like Bill Clinton intellectually in many ways, if anything more pragmatic.

E.K.: I think serious global-warming action is nearly an impossibility.

T.C.: Foreign policy can be hard to predict. We agree on global warming, though of course Obama would prefer to do something. I don't think he'll rush to pull out of Iraq. I don't think he will bomb Iran. If Iran gets the bomb, the Republicans will run on that and jump on Afghanistan falling apart. I don't think he or anyone can fix that.

E.K.: I agree. Though it should be said: Clinton took a run at an incredibly ambitious health-reform plan that if it had succeeded would have redrawn him as one of the most bold progressives presidents of the twentieth century. It was in failure, and retreat, that his presidency took on a more modest cast.

T.C.: I think on health care Obama already has staked out his maximum ambition. I think he views simply "being a good and competent president" as a huge benefit for the American republic, and America's image in the world. Maybe he is right.

E.K.: What's your best case vision of a McCain presidency? Given that we just did the likely vision of the Obama administration.

T.C.: Best case vision? Simply that the Iran talk is a bluff, he will be moderate elsewhere, and seen as a president of transition. You? I give that about p = .26, by the way.

E.K.: Hemmed in by a Democratic Congress, he'll gamble that history will view him more kindly if he governs as a centrist deal-maker, and he'll ache to rediscover the national adulation of his 2001—2003 persona. And he won't invade anyone, because we won't have the troops to do it right.

Earlier: Ross Douthat and Tyler Cowen on Lieberman, Palin, and Outlawing Abortion

For a complete and regularly updated guide to presidential candidates Barack Obama and John McCain — from First Love to Most Embarrassing Gaffe — read the 2008 Electopedia.

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