Elections: First Reaction
Jude Wanniski
November 7, 1984


The President gets a big vote of confidence, but no blank check.  There's some depression among Republicans because of the two-seat loss in the Senate and the meager gains in the House.  But the Reagan-Bush strategists invited these results by refusing to put forward a growth agenda for the second term.  (Reagan's pre-election TV talk to the nation was typical, asking voters to elect GOP congressmen to help him pass a Constitutional amendment to balance the budget.)  All attempts to have RR appeal to the black community were rejected, the campaign strategists encouraging a black-white split, the antithesis of party building.  In this light, the President doesn't deserve a blank check, which the Baker-Stockman-Dole faction would have used to press for budget reform (shredding the social safety net) as the centerpiece of the second term. This avenue is blocked by House Dems who will not permit significant social spending cuts.  But RR's big victory also blocks tax hikes, Stockman denied the "wiggle room" he needs to make deals with the Dems.  It's a fact that the voters emphatically rejected the Mondale/Demo platform, and most of the House Dems in close races ran away from them too.  So it's not easy to simply interpret the RR landslide as a "personal victory," as the egalitarians are attempting.  The electorate's message on taxes is clear and Dems will rethink their Robin Hood strategies, moving toward NJ Sen. Bill Bradley's position, wedding growth reforms to some remnants of redistribution (progressive flat tax, for example).  Also, a boost to Star Wars antimissile defense and somewhat less liberal sniping at RR foreign-policy initiatives.  Dems will worry about 1986 elections, hesitate to oppose RR economic policy moves once they're made specific (as RR should have done prior to election).  Voters made clear they approve of current direction of RR leadership and Dems will not want to leave him room in '86 to denounce them as barriers to progress or blame for any intervening recessions.  The next several weeks are critical as White House interprets the mandate and decides on strategy for '85. If RR keeps his head, he'll realize he's in a powerful position, with the biggest danger that Baker & Co. will talk him into negotiating with himself into making unnecessary deals with the Dems.  After all, the Senate-House lineup is almost the same as it was in '81 when he pushed his program through, the difference that he's won much, much bigger than he did against Carter/Anderson in '80, especially in the South.  He's going to put forward a tax reform plan early on, and if he does so with boldness and confidence, he'll get it through.  But Dems and Old Guard GOP will try to talk him into using tax reform, with "revenue enhancement," as bait for spending cuts.  Same old game.  Kemp, Lott, Gingrich, Kasten crowd are alert, staying in D.C. during these crucial weeks, to make the case for the GOP platform, bold moves, focus on economic growth instead of deficits.  I'm optimistic, more so than on election night 1980 when Nixon-Ford retreads crowded in to claim the mandate.  Austerity forces have tough job persuading RR that after he wins 49 states he's in a weak position, that Congress will defy him on moves to get the economy rolling.  They could have been better, but the elections were still a big victory for growth and shouldn't be thrown away.