Ezra Klein writes:
You'd think that Keynesian economics was a big divide between the parties. But it wasn't and it's not.
In January 2008, George W. Bush signed $152 billion in tax-cut-driven stimulus. As the economy worsened, John McCain proposed $450 billion more in stimulus, this plan driven by a payroll tax cut. Now you've got Mitch Daniels proposing something similar.
The parties disagree on a lot of things, but they don't disagree over the idea that the government should act to increase demand when the economy sags.
Call me cynical, but I'd rephrase: I'd say "the parties disagree on a lot of things, but they don't disagree over the idea that stimulus is a first-class excuse for doing whatever it was you wanted to do anyway.
How many Democrats do you think could make even a C+ stab at explaining the Paradox of Thrift, and how Keynesian stimulus works? Ask them about, say, the infrastructure spending, and it becomes readily apparent that the average Democrat has no grasp of the distinction between what makes a good long-term project for the economy, and what makes for good stimulus.
Nor are the Republicans any better--ask them about the stimulative effects of tax cuts, and you're more likely to get a confused exegesis of the supply-side effects, than any serious theory of aggregate demand management.
Or at least that's what I see on television.
To my way of thinking, George Bush didn't do tax cuts because he cared about stimulus; he did tax cuts because he cared about tax cuts. And if Democrats had cared about stimulus, we would have gotten a stimulus bill that looked almost nothing like the one they actually delivered.
There are exceptions in both parties who do understand the theory, of course. And I have no doubt that both groups genuinely believed that what they were doing was "good for the economy", and thought that this somehow meant they were doing stimulus. But the idea that either party has a sufficiently solid grasp of economics to say that they have a meaningful opinion on stimulus seems terribly optimistic to me.
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