Week In Politics: Economy, Midterms

Robert Siegel speaks with our regular political commentators, E.J. Dionne of The Washington Post and Brookings Institution and David Brooks of The New York Times, about the economy and the campaign season.

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ROBERT SIEGEL, host:

Our regular political commentators are here: columnists David Brooks of the New York Times, and E.J. Dionne of the Washington Post. Good to see both of you.

Mr. E.J. DIONNE (Columnist, The New York Times): Good to be with you.

Mr. DAVID BROOKS (Columnist, The Washington Post): Good to be here.

SIEGEL: And as we heard, the president has promised a broader package of ideas sometime next week, aimed at reviving the economy. David, might we be seeing Obamanomics 2.0?

Mr. BROOKS: Well, the ideas that are being talked about include payroll tax holiday, some business tax cuts, some infrastructure spending, some training spending. All of it, I think, would've been really good a year or two ago, especially the payroll tax holiday. But I'm not sure it's really that effective now. I've sort of lost a lot of confidence in the idea that we can have a big, short-term impact on the economy.

I think all the focus should now be on long-term fundamentals, getting it so we can have a really sustained recovery years out. The idea that we can juice up the economy next month or next quarter seems, to me, illusory.

SIEGEL: E.J., are you any more hopeful about a package of new economic measures next week?

Mr. DIONNE: Well, not only am I more hopeful, but I think it's absolutely critical that it happens. If unemployment were at 6 or 7 percent, then David might be right - we can focus on the long term. But we can't focus on the long term.

Just on today's numbers, my favorite comment so far today was Andrew Ross Sorkin, the financial columnist for the New York Times, who said this is great news on a relative basis. Probably emphasis on a relative basis, but we are not in a double-dip recession. A couple months ago, we were worried that's where we might be headed. And there was private-sector job growth.

But given the political problems the Democrats are in - that we'll get to -I think the president needs to sort of shake the campaign up. I think he should go out there and say, let's have a big fight about these tax cuts. Let's insist on cutting them for people under 250,000. Heck, let's raise it - everybody under a million bucks. And then take the balance, and put that money into an infrastructure bank and start growing for the long term. This is my version of wedge politics against David because he likes the infrastructure bank, too.

I think a choice between they're for the millionaires, we're for faster growth, could be an interesting - both politically and as economic policy.

SIEGEL: David?

Mr. BROOKS: Well, economically, let's be clear: It's not going to have any effect this year, no matter what gets passed. So now, we're strictly talking politics. And I think the Republicans would love to have a tax cut fight of any sort.

SIEGEL: All right, let's talk politics. When the economy is bad, it's almost always the decisive campaign issue. It's pretty bad. And the forecast that we're hearing for November - are it's going to be a decisively good year for the Republicans. How good do you think it's going to be, David?

Mr. BROOKS: Well, right now it will be extremely good, historically good. If you average the smart election watchers around here, I think you'd probably get an average the Republicans will pick up around 50 House seats, eight or nine Senate seats. Give them control of the House, almost control of the Senate.

There was a Gallup poll on something called the generic ballot, which is do you want a Republican or a Democrat? The Republicans were up by 10 points, which is the highest in the history of polling. And if you throw in likely voters, not just the regular voters they sample, you get up to 14 points. So historically, great election for the Republicans. And it's mostly the economy, but it's also a rejection of the Democrats - and I think a rejection of what people see as big government liberalism.

SIEGEL: Well, traditionally, Labor Day, which we're almost at, is the beginning of the campaign season. Does that mean, E.J., that now we might see the numbers start to move - or this is it; this is what November's going to look like.

Mr. DIONNE: Well, first of all, I'm a skeptic on those Gallup numbers simply because Gallup is bumped around a lot. They had the Democrats up six points in mid-July. I can't believe there's been a 16-point swing in six weeks since, and so we'll wait on that. But the Republicans are ahead. Pollster.com has them up by three. So the Democrats have a problem. But if it's within the range of three or something like that, then it is at least conceivable that Democrats can claw back enough to maintain control of the House.

That's, I think, the whole game. I think, except on a very bad day, I don't think the Democrats are going to lose the Senate. But given where it is, the Democrats do have to shake this race up. The president has to be out there in a much more forceful way, defining the argument in a way I don't think he has so far.

SIEGEL: David, do the Republicans have to define the argument?

Mr. BROOKS: No. They just have to be no.

SIEGEL: Just say no.

Mr. BROOKS: The Republicans are not exactly Mr. Popularity these days. What's striking is that people have a very low opinion of the Republicans and yet seem, at the moment, determined to vote for them. So being no right now seems to be working.

SIEGEL: Another item: This week witnessed Israeli-Palestinian talks at the White House. Bill Clinton famously dove into Middle East peacemaking when he was president - and he failed. George Bush didn't even try. Does the Obama initiative hold out any promise of success? David, what do you think?

Mr. BROOKS: I'm a pessimist. I go to the Middle East once a year or so, and there's always a peace process going on that goes by different names: the Mitchell Report, the Quartet. There's always some fancy negotiation. But until I see change at the bottom level, at the bottom up, I really don't believe there's going to progress. And I see no change at the Israeli level, at the Palestinian level. And if something does happen, believe me, the Iranian nuclear program within a year will mess it all up anyway.

SIEGEL: But what you heard from Netanyahu or Abbas here in Washington...

Mr. BROOKS: I've been at dinners with the Israeli and Palestinian leaders, where they're in love with each other. That doesn't mean things are different on the ground.

SIEGEL: E.J., what do you think?

Mr. DIONNE: One of my favorite lines about politics is Eugene Debs -yes, he was a socialist - who said: Blessed are they who expect nothing, for they shall not be disappointed. And I think that's why you're actually hearing some optimistic talk. There were very low expectations here. And I think there are some odd factors that may play positively to move this along.

Scott Wilson, in the Washington Post, suggested that the Iran threat may help these talks on the theory of the enemy of my enemy. Sunni Muslims are very worried about Iran - almost as worried as Israel is. And that could create some pressure to get somewhere. So to ever be completely optimistic or even very optimistic in Mideast talks is foolish, but I think there's a real potential here.

SIEGEL: I think that's a quadruple negative. I wasn't keeping score entirely, but I take that point.

Mr. DIONNE: That's probably right. That's about right for the subject.

SIEGEL: E.J. Dionne and David Brooks, thanks for talking politics with us once again.

Mr. DIONNE: Thank you.

Mr. BROOKS: Thank you.

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