Voting and economic policy (updated)

In his latest article in the New York Times, It's an Election, Not a Revolution, Tyler Cowen makes a nice point about voting and economic policy, one doesn't much effect the other:

To put it simply, the public this year will probably not vote itself into a much better or even much different economic policy. To be sure, the next president — whoever he or she may be — may well extend health care coverage to more Americans. But most of the country's economic problems won't be solved at the voting booth. It is already too late to stop an economic downturn. Health care costs will keep rising, no matter who becomes president or which party controls Congress. China is now a bigger carbon polluter than the United States, so don't expect a tax or cap-and-trade rules to solve global warming, even if American measures are very stringent — and they probably won't be, because higher home heating bills are not a vote winner. A Democratic president may propose more spending on social services, but most of the federal budget is on automatic pilot. Furthermore, even if a Republican president wanted to cut back on such mandates, the bulk of them are here to stay.

He goes on to make the point,

The reality is that democracy is a very blunt instrument, and in today's environment we are choosing between ways of muddling through. We may hear that the election is about different visions for America's future, but the pitches may be more akin to selling different brands of soap.

We hear so many superficial messages precisely because most American voters have neither the knowledge nor the commitment to evaluate the pronouncements of politicians on economic issues. It is no accident that the most influential political science book of the last year has been "The Myth of the Rational Voter," by Bryan Caplan. The book shows that many voters are ill-informed or even irrational; many economic issues are complex, and each voter knows that he or she will not determine the final outcome.

Cowen follows up with bit of advice,

Rather than being cynics, we should be realists. Democracy is reasonably good at some things: pushing scoundrels out of office, checking their worst excesses by requiring openness, and simply giving large numbers of people the feeling of having a voice. Democracy is not nearly as good at others: holding politicians accountable for their economic promises or translating the preferences of intellectuals into public policy.

Cowen is right in that economic policy does not in most cases change via the voting booth. For big economic changes to be implemented normally requires very special circumstances. In the US the New Deal brought about a revolution in economic policy, much of it for the worse. But at the time the US, and the world, was in a depression and economic planning was all the rage all over the world. For the US that period was exceptional. As Cowen writes,

That period is an exception; it does not reflect the general tendency of the American political system, which usually operates by checks and balances. Shifts in economic policy are usually quite moderate.

In New Zealand much change, mainly for the good, occurred post 1984. But again this an exceptional period for New Zealand. We had been driven into crisis and the Lange Labour government took advantage of that to make the needed changes. But that wasn't the norm and soon things when back to the politically normal. We got the famous Lange "breather and a cup of tea" of 1987 and it is still going on. We missed our big chance to move into the economic fast lane. And it appears we have a lack of political will, by all parties and voters, to try to get us back into it. Normal transmission has been resumed.

Update: Mark Thoma comments here. John at Swords Crossed comments here. Don Boudreaux comments here. Greg Mankiw comments here. Tyler comments here.