Third Party or Political Realignment?

Earlier this month, in response to myopic pandering to the public on gas prices by both political parties, Thomas Friedman wrote an editorial column wishfully hoping for a third party and an idealized candidate who would tell the truth about energy policy. As if the public wanted to hear it. (Al Gore, anyone?)

But seriously, is a third party candidate possible? Is a viable third party possible? And is it something we should work for?

As an economist and game theorist, my default position is “No.” If a third party candidate comes up the middle, the two other candidates will simply slide towards the center, retaining their base and dividing up most of the center. But historically, I know that is not always true. Political realignments happen along issues that are orthogonal to the existing political spectrum. Sometimes this creates an opening for a third party, sometimes it just mixes up the existing parties. To decide if a third party is viable, we must first determine what issues are not being addressed by the existing political spectrum.

[Here I am going to borrow from Nobel-prize-winning economic historian Robert Fogel, and his book, “The Fourth Great Awakening,” which borrows liberally from historian William G. McLoughlin’s book, “Revivals, Awakenings, and Reforms.” I haven’t read the latter, and I don’t agree with a fair part of the former, so I will present the part that rings true and leave it to others to divide the credit between the two of them.]

Fogel’s thesis is that scientific and technological advances ripple through American society, causing changes in institutions, markets, and individual prospects, which inevitably raises important new moral and ethical questions. In his view, religious revivals are responses to these changes and the moral questions they raise, and historically these revivals have been the political impetus for social reforms. Both McLoughlin and Fogel interpret religious revivals liberally, counting as part of the third awakening (which started near the end of the nineteenth century) a humanism that accommodates both evolution and psychology. And they disagree on the fourth awakening, with McLoughlin (1978) believing a left-wing liberal morality is leading and Fogel (2000) thinking it’s the conservative right-wing.

I think the “religious revival” label is a red herring, because it suggests that established religions express a more fervent moral understanding than, for example, secular humanism. The social upheaval that results from the societal ramifications of scientific advancements might better be viewed as simply “a great awakening to new moral and ethical questions.”

These new moral questions are precisely what is not being addressed by the existing political spectrum, and so could result in a political realignment.

Let me try to enumerate the advances in scientific knowledge and technology that raise new, important moral and ethical questions with big political implications:

1) Advancements in biological/medical science
a. New and expensive medical technology has resulted in a real difference in life-span and quality-of-life between the haves and the have-nots. To what extent should society attempt to make things more egalitarian? Do only those who can pay for it deserve to live better and longer? Who should we subsidize? What treatments should be covered?
b. New technology and new information about the start-of-life has started a culture war, starting with IVF and its accompanying embryonic issues: genetic selection, selective reduction of embryos during pregnancy, left-over frozen blastocysts, and finally, stem-cell research. The advent of ultrasound images and the backward creeping age of viability for premature infants started reigning in second-trimester abortions, and the fervor is so intense it reaches to include early abortions, chemical abortion (RU-486), and even emergency contraception (Plan B) and hormonal birth control itself.
c. Recognition of the genetic basis for homosexuality doesn’t just put in question the long-standing moral reprehension of gay and lesbian relationships; it puts the social purpose of marriage on the table for discussion.
d. End-of-life issues multiply: Once there was dead. Then came brain-dead. Now there is a persistent vegetative state. Also, if we can ease the suffering of those who are near death and in great pain, to the point that it is unclear whether the disease or the morphine actually did them in, what about those who are not as near death, but are in great pain? And do we spend inordinate amounts of money to extend life by a few years or months for the old, while ignoring basic care for the young?
e. Advances in psychotropic drugs impact quality of life. Moving beyond anti-psychotics to drugs like Prozac and Ritalin emphasizes the continuum of mental health and raises the question: what is normal? What business is it of others if individuals use medication to ease difficulties that once may have been considered within the range of normal, but may impede their life?

2) Economic advancements, such as increasing economic knowledge about the value of free trade and technological advancements creating the information economy, result in globalization. The interdependence of our economies becomes more pronounced and more evident.
a. Our economic policy has immediate effects on individuals around the world. How do we forward the development of our own economy without harming the poor in developing nations? How do we promote the welfare of specific citizens who lose jobs to globalization, without harming the vitality of our own economy?
b. Economic and political inequality creates cognitive dissonance within some religions, resulting in religious fundamentalist terrorism. Terrorism is aided by globalization and the information economy, so a few individuals can create a huge impact.

3) Environmental issues are better understood
a. There is now overwhelming scientific evidence of global warming. How we behave has enormous impact on the entire world. This is a global coordination problem over negative technological externalities, with individual countries having an incentive to free-ride on the efforts of others.
b. We have the tools, both in economics and in physical science, to address other environmental issues, and we need careful government policy that pays attention to science as well as all costs and benefits of land use and pollution.

Let me know if you think I have missed some.

I think there is a good argument that the New Democrats have claimed the center, and are credibly trying to address these new problems. The Clintons recognized the state of the health care market as a problem 15 years ago, while the current administration has Dick Cheney saying, “We have the greatest health care system in the world.” Well, sure, if you can pay for it, which is precisely the problem with it. The Republicans’ main response was a prescription drug benefit entitlement program, which, when I look around and ask where we should invest money for the future of our country, Medicare Part D is right near the bottom of the list as a terrible investment.

Clinton recognized the importance of free trade, pragmatically (I think he trademarked that word) implementing NAFTA despite real environmental concerns. Sometimes you have to sign the free trade agreement you have, not the one you wish you could have. Yet he also forwarded the Kyoto Accord, which President Bush later refused to sign.

He promoted job flexibility through higher education and insurance flexibility, which is key to helping individuals who are harmed by globalization, while avoiding the drag on our economy that comes from protectionism of declining industries.

He worked to reduce farm subsidies, which have the perverse result of taxing Americans to grow corn, for example, only to lower the income of subsistence farmers in African nations. The Republicans came back into power in 2002 and immediately raised farm subsidies, as a payback to a few large campaign contributors, never mind that they are kicking down developing countries who are trying to lift themselves out of poverty.

Al Gore is a huge supporter of alternative fuels. We do need a Manhattan project for our time, a government funded basic research project for alternative, renewable fuels and energy technologies that will allow us to stop contributing to global warming.

As for the “culture of life” and homosexuality issues, well, I believe the Democrats are in the right. But nobody who requires written statements from a religious authority in order to make moral decisions is going to agree with me.

The real problem for the Democrats is that this is truly a political realignment in process. The New Democrats have claimed the center, but they still share the party with the old Democrats and the old institutions. It’s a party divided, resulting in a very ineffective Democratic party. Fortunately, the Republicans are doing everything they can to bolster the Democrats' claim to the center.

The old Democratic institutions are out-of-date and irrelevant. The welfare state was bad for individual incentives. The unions and protectionism are a drag to market competitiveness. The Democrats’ saving grace is that their ideals hold, the ideal of egalitarianism. Everybody gets to vote. Everybody gets an education. Everybody gets a job. Everybody has time off to relax. Everybody gets a little bit of a safety net (health insurance, unemployment insurance, job training), in exchange for the personal risks faced in a vibrant market economy.

I argue in my forthcoming essay, on the cold war origins of the Republican economic ideology, that the Republicans are ill-equipped to deal with these problems listed above. The Republicans hew to the other great American value, the self-made man. Opportunity and hard work are all you need. Unfortunately, most of the problems listed above are problems of interdependency between individuals and between nations. You cannot solve these problems if you are a cowboy. You can’t even comprehend these problems if you are a cowboy.

It reminds me of a quote from Bill Clinton’s book, “My Life.” Referring to Ken Brody, a Goldman Sachs executive who wanted to get involved in Democratic politics, Clinton said, “Ken told me he had been a Republican because he thought the Democrats had a heart but their head was in the wrong place. Then, he said, he had gotten close enough to the national Republicans to see that they had a head but no heart, and decided to join the Democrats because he thought it was easier to change minds than hearts.”

The Hamilton Project at the Brookings Institution is a very good start. The press and concerned citizens need to stop saying the Democrats don’t stand for anything and start paying attention to what is coming out of credible left-leaning think-tanks. The New Democrats are the future: same values, better economics, better facts, and better governance.