Wednesday, August 13, 2014

Is the slow economic recovery...

...actually working in the Democrats' favor? Will the absence of a recession in the next two years end up electing Hillary Clinton president in 2016? I've been wondering this lately and have meant to write a post in that vein. But it looks like Jonathan Chait beat me to it. From "Have House Republicans Extended the Economic Recovery Into 2016?" (my emphasis):

Rather than stimulating economic growth through short-term deficit spending, Republicans have instead kept a fiscal vise that, according to macroeconomic forecasters, has held the recovery to a painfully slow rate of growth.

But at the same time, the fiscal vise has had the likely side effect of extending the duration of the recovery.

Last week, JP Morgan chief economist Michael Feroli published a short paper demonstrating that the speed of economic expansion since World War II has correlated inversely with its length. “Somewhat counter-intuitively,” he concluded, “the shortcomings of this expansion — an initially high unemployment rate and slow growth — are virtues when thinking about how much longer the expansion will run.”

That would put the recovery on schedule to expire in 2018, just in time to position Republicans to benefit from another angry midterm wave, but not fast enough to win the White House. 

The problem for Hillary, then, is how to avoid the fate of George H. W. Bush, who suffered a recession and was turned out of office after only one term.  

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