Comment: If Democrats want to win they have to simplify

For example, broad tax reform won’t fly, but they might find support for a smaller scale proposal.

By Clive Crook / Bloomberg Opinion

Democrats have presumably noticed that their prospects in November’s elections aren’t good; but you wouldn’t know it from the way they’re talking to voters. President Biden and his allies proceed as though everything’s under control. Goals and messaging are much as before, and protests from the middle of the electorate are deflected or ignored.

But there is a difference between being resigned to defeat and inviting it. Could Democrats improve their chances, if they decided to try? Maybe, but only if the administration scales back its policy ambitions and aligns them more closely with what it can plausibly achieve.

This gap has been the Biden presidency’s defining characteristic. Its constant theme has been the need for transformation. Every aspect of economic and social policy, according to the administration, demands radical change. Wherever you look, there’s an existential crisis. Global warming. Systemic racism. Massive inequality. Workers trampled. Consumers gouged. Capitalism run riot. And all these ills are of a piece. Steady incremental improvement won’t work. The U.S. is so badly broken it has to be rebuilt.

Median voters are a timid sort. Even if they agree that a lot of things need attention, they’re suspicious of revolution. They’d rather see the country mended than reinvented; and this is where a lot of Democratic messaging goes off the rails. Oddly enough, most voters don’t like being told that they are enabling white supremacy. Others feel that the rise in urban crime demands some kind of policy response. People can be pretty unenlightened on such issues.

Even if the cautious middle of the electorate hungered for social transformation, it would need to trust the administration’s ability to deliver. Biden and his team inspire no such confidence.

Instead of recognizing that its sprawling plans lack support in Congress and adjusting its proposals accordingly, the administration keeps pressing; infuriating progressives and moderates alike. Its management of the pandemic and its consequences has been erratic.

At the moment, voters are most concerned about inflation, which the administration made worse with the excessive spending in the American Rescue Plan; it then denied the scale of the problem and shifted the blame. The gaffes keep coming. (A Disinformation Governance Board lodged in the Department of Homeland Security?) Most important, to put it politely, the president is a less than convincing chief executive.

All this demands a recalibration of ends and means. Dare to think small. Discrete, simple and straightforward initiatives — advancing the administration’s larger purpose, capable of commanding sufficient support in Congress, and easily explicable to skeptical voters — should be Biden’s priority.

For example, instead of persisting with all-encompassing tax-and-spending packages that voters don’t understand (and wouldn’t trust the administration to execute if they did), it would be better to combine a narrowly targeted tax increase on the wealthiest households with a similarly targeted increase in spending on the poor. Make it revenue neutral to allay concerns about its effect on the budget deficit and/or inflation. Design it with Sen. Joe Manchin, D-W.Va., who knows some swing voters, and one or two Republican senators who might be willing to go along. Tell frustrated progressives that a policy addressing income inequality and helping the poor is worth supporting even if it appeals to moderates.

Here’s one possibility. The single most egregious loophole in the tax code is so-called stepped-up basis for assets at death. This means inheritors acquire the assets at their current market value, erasing years of capital gains for tax purposes; an enormous benefit for the richest families. Once or twice the administration has proposed abolishing this treatment, and the idea is included among a blizzard of other tax proposals in its recent dead-on-arrival budget.

Use the proceeds from that single reform, maybe in combination with a higher rate of tax for households with very high incomes, exclusively to pay for a reformed and expanded Earned Income Tax Credit, and/or a fully refundable Child Tax Credit. That way, a substantial and entirely justified increase in taxes on the rich would be spent directly on cutting poverty and widening opportunity, instead of vanishing into the boundless cost of a whole new America.

Many Democrats might think: how disappointing. This is precisely why their party is in such trouble. A measure like this would be good policy. No less important, it would be smart politics. It might well command enough support in Congress to pass, which would be great. But if it didn’t, the idea would be simple and compact enough for voters to grasp and endorse, letting Democrats use its defeat as a weapon against Republicans. Assuming, as I say, that the president and his party actually want to limit their losses in November.

Clive Crook is a Bloomberg Opinion columnist and member of the editorial board covering economics. Previously, he was deputy editor of the Economist and chief Washington commentator for the Financial Times.

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