Occam's Razor

As best I can parse it, the message from voters last night was, “the beatings will continue until the morale improves.” Republicans gained at least sixty house seats. Looking at the House electoral map it looks largely red from sea to shining sea. Unfortunately for Republicans, we have a bicameral legislature. While Republicans made important gains in the Senate, they did not win majority control. Democrats control at least 51 senate seats. Colorado and Washington State remain in dispute, but seem likely to go blue. Lisa Murkowski apparently won a write in vote in Alaska, and will doubtless canvas with the Republicans. So the Senate remains Democratic, with a likely 53-47 Democratic majority.

One lesson for Republicans: the Tea Party giveth and the Tea Party taketh. Their energy doubtless piled on Republican House majorities, but proved counterproductive in the Senate. While adding Tea Partiers Rand Paul in Kentucky, Pat Toomey in Pennsylvania and Marco Rubio in Florida, overall Tea Partiers likely cost the GOP control of the Senate. Christine O’Donnell lost by seventeen percent in Delaware. John Raese lost by ten percent in West Virginia. Harry Reid, largely reviled in Nevada, won by five percent over an even worse candidate, Tea Partier Sharron Angle. In Alaska, voters were inclined to not take the advice of their former governor Sarah Palin and through a write in process elected Lisa Murkoswski instead. Doubtless, there will be recounts in Washington State and Colorado, but it doesn’t appear that the extreme positions of Dino Rossi or Ken Buck helped Republicans. More milquetoast candidates might have flipped these seats and given Republicans control of the Senate too. While the outcome in the House was a major disaster for Democrats, in a poisonous election year for incumbents, Democrats actually came out surprisingly well overall, retaining control of the Senate and, of course, the White House for two more years.

Democrats though need to check their backs, because Republican governors also did very well last night. Republicans control a majority of governorships and added control of ten legislatures last night. Governors and state legislatures draw congressional districts, which means that districts will drawn in an even more partisan manner, resulting in higher levels of Republicans in Congress. The long-term trend for Republicans though is not good. Ultimately, demographics will do them in, unless they can find ways to broaden their appeal toward Hispanics and younger people.

There is a lot of exit polling trying to make sense of this election. Doubtless, the analysis will get spun and respun. The animus driving this election though is clear: it’s the economy stupid. If somehow Democrats had managed to undo all the excesses of Republican rule in their two years and employment were at five percent instead of near ten percent, this wave likely would not have occurred. Voters expect politicians to make their lives better. When it does not happen, they tend to vote their bum out and vote the other bum in. At least fourteen percent of House seats flipped in this election. This is a remarkable number rarely seen in our history. It reflects the great anxiety that Americans are feeling now. What is remarkable is that with 9.6% unemployment even more representatives were not voted out of office.

It remains to be seen whether either party will learn from this election. My betting is neither will, which means, as I predicted in September that the only thing we can count on for sure in the next two years will be greater national dysfunction. What is the point of having power if you do not use it? House Republicans will probably be unable not to scratch the itch, so I expect all sorts of convoluted attempts (which are doomed to fail) to somehow “undo” health care reform and punish President Obama for alleged “socialism”. In reality, the American people don’t care that much about the health care law. What they care about is their own bottom line. Just getting back to their standard of living before the recession would make most Americans happy. Unfortunately, even if we had a united government there are no quick solutions to our national problems. The only real solutions are long term. So far, major tax cuts, many targeted toward business of all kinds, haven’t spurred hiring. Deficit reduction won’t spur hiring either. It may be prudent for the government to live within its means, but that doesn’t translate into more jobs. In the short term, it takes money out of the economy, increasing unemployment.

What will it take? Some certainty about our future would help. To start, it would be helpful to clear up the backlog of millions of foreclosed houses. Doing whatever it takes to resolve these foreclosures quickly makes an unknown problem a known one with a defined size and scope, allowing businesses to adjust their economic expectations accordingly. The other part are systemic reforms that Democrats have been working on, albeit sporadically and ineffectively. Health care costs are the biggest vampire on our economic health. The health care law certainly is not perfect, but it is a step in the right direction. Unfortunately, there is no quick way to change a health care system. It takes time. Eventually though these efficiencies work their way through the system. As health care costs are controlled, more money is available for uses that are more productive and we add more certainty to the economy as well.

Unfortunately, the American people show little patience for long-term solutions focused, as they tend to be, on their own personal pain. Many of the reforms working their way through our system now, like health care reform and financial reforms, will add certainty to our economy. However, since we seem to be doomed to have not just divided government, but hostile government for the next two years, more certainty is likely to elude us, which will likely keep unemployment artificially high. Certainty does increase if parties can find common ground and develop consensus solutions. It is hard to see how this can happen with so many new Tea Partiers and no-compromise Republicans in Congress. It is not even clear if House Republicans will raise our debt ceiling in a couple of months, and keep our nation from defaulting on its loans.

If you are a praying and patriotic person, now is a good time to pray because we need political accommodation that will almost certainly elude us. Just as was true when voters went for Democrats, voters are giving Republicans a qualified mandate to get useful work done. They have no more inherent trust in Republicans than they do with Democrats, in fact less as poll after poll bears out. They just want things to get better. Will Republicans listen? If obfuscation is their strategy, they may find, as Democrats found out yesterday, that their hold on power will also be short lived.