Economists for Clinton

WASHINGTON, DC

IT IS a sad reflection of the state of the presidential campaign that Bob Dole, a man not known for telegenic brilliance, is counting on a sparkling performance in Sunday's debate to revive his fortunes. Worse, judging by the results of a poll (see chart) by The Economist, Mr Dole has already lost one of the groups whose approval he most craves: economists. We randomly selected 60 macroeconomists at America's top 15 universities (around half the total number). Almost 70% responded to our survey. By a margin of almost three to one, the academics reckon that a second Clinton term would be better for America's economy.
     Given how much Mr Dole touts the academic respectability of his economic plan, these results are surprising. In a new newspaper advertisement, the Dole plan is lauded by Nobel laureates and endorsed by over 100 economists. "This is an excellent economic programme," writes Milton Friedman. "The Dole Economic Growth Plan is much superior to the Clinton do nothing alternative," says James Buchanan, another Nobel laureate. Eminent supporters perhaps, but it seems that many of their colleagues disagree. The general verdict seems to be satisfaction at the first Clinton administration and scepticism about Mr Dole's economic promises.
     First, we asked our boffins to grade Mr Clinton's economic record, much as they would evaluate a student's performance. Just under 30% of the academics award Mr Clinton an A; 51% give him a B. Only one judges that Mr Clinton has flunked on the economy, and gives him an E. Pollsters often put Mr Clinton's double-digit lead in the opinion polls down to a well-performing economy. The experts' verdict seems to bear out what ordinary Americans feel.
     Unfortunately for Mr Dole, our economists are distinctly unimpressed with the centrepiece of his economic platform--big tax cuts. Only 22% support his ambitious tax plan, while 46% prefer Mr Clinton's modest tax-tinkering proposals (and a hefty 32% do not like either). "Both are bad, but Clinton's is less irresponsible," is a typical view. Those who approve of the Dole plan are at least entertainingly honest about the reason for their support: "I helped prepare it," was one comment; "I will pay less taxes," was another.
     Overall, however, few think that Mr Dole's numbers add up. Only one in five professors reckons Mr Dole will be able to recoup as much of the cost of tax cuts through higher revenue as he hopes, and even fewer accept his claims about cutting taxes and balancing the budget by 2002 without further restraint on Medicare and defence spending. Mr Dole's belief that this achievement is just a matter of "presidential will" cuts little ice with the experts.
     A surprising slice of economists (49%) even takes issue with Mr Dole's basic assumption--that growth should be America's top economic-policy priority. For many, questions of income distribution and poverty are higher on the agenda. Others have more esoteric priorities: one professor thinks that legalising drugs should be one of America's top economic concerns.
     The academics are equally wary of Republican claims that America's economic growth rate can, in fact, be dramatically boosted. In our poll, only 5% think that America's trend rate of non-inflationary growth could realistically be raised above 3% a year. Around one-third reckon it could be bumped up to between 2.6% and 3%. But most (almost 60%) say an economy growing at 2.5% or less is the most realistic target.
     We asked our experts to grade various policies according to their growth-enhancing potential. Again, the idea of tax cuts fares poorly. Only a small minority of our economists (12%) believe that a cut in marginal tax rates--with corresponding spending cuts--would have a major impact on growth. A larger group (41%) think it might have a minor impact, but 34% reckon such cuts would have a negligible effect. Were the tax cuts not accompanied by spending cuts, almost half the professors think the impact on growth would be harmful. Only one policy option is even less popular: looser monetary policy. Six out of ten economists reckon that this would be harmful for long-term growth.
     Ironically, perhaps, some of Mr Dole's other proposals find strong support among the boffins. More than four out of five think that education reform would give a major (51%) or minor (34%) boost to growth rates. In fact, when asked to give their top three priorities for raising growth rates, over 70% of the academics mention education.
     One in four believes a lighter regulatory burden would make a big difference to growth rates; almost 50% say it would provide a small boost. And more than eight out of ten reckon that tax reform towards consumption taxes could help growth (24% predict the effect would be big; 61% say it would be minor). All told, 63% of the economists support fundamental tax reform, with the flat tax emerging as the most popular option.
     Despite this strong support for radical tax changes, America's top economists seem an unradical lot. When asked which party combination between the White House and Congress they would prefer for the next four years, over 50% want divided government: ie, a Democratic president and at least one chamber of Congress held by Republicans. Only one in four would like to see Democrats in charge on the Hill and in the White House; even fewer (17%) want Republicans running both places.
     Not only do few top economists want Mr Dole in the White House; even fewer seem prepared to help him if he ever gets there. Only 5% of our respondents admit they would take a job in a Dole administration. One-third would accept a job in a Clinton administration, and almost 60% say they would turn down any offer. Too high-minded for the hurly-burly of Washington? Or not to be taken too seriously?

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