Partisanship Bias and the Economy

by on April 16, 2009 at 1:29 pm in Uncategorized | Permalink

Andrew Gelman and John Sides, writing at FiveThirtyEight, have a very good post on how partisanship biases perceptions of the economy.  It's well known that views of the economy often differ by partisan identification but that could be explained by differences in interests.  What Gelman hammers home is how partisanship can cause people to have views widely at variance with reality (regardless of interest) and how quickly views can change when partisanship changes even when the facts stay the same.

A good example comes from the research
of Larry Bartels. He analyzed a 1988 survey that asked “Would you say that
compared to 1980, inflation has gotten better, stayed about the same, or gotten
worse?” Amazingly, over half of the self-identified strong Democrats in the
survey said that inflation had gotten worse and only 8% thought it had gotten
much better, even though the actual inflation rate dropped from 13% to 4% during
Reagan’s eight years in office. Republicans were similarly biased about the
Clinton-era economy: in 1996, a majority of Republicans thought that the budget
deficit had increased. This partisan filter was also evident after the
Democrats’ retaking of Congress in 2006. Research
by Alan Gerber and Greg Huber shows that Democrats became much more optimistic,
and Republicans more pessimistic, about the national economy.

Views
about foreign policy manifest a similar bias. For example, from 1965 through
1968, Democrats were more likely than Republicans to support the Vietnam War,
but starting in 1969, it was the Republicans who were (slightly) more
hawkish.

Could such biases be a product of the relatively mild economic
conditions of the past twenty years? Early returns from 2008 and 2009 suggest
that partisan biases still operate. According to Gallup Poll data from just
before the November election, 20% of Republicans and 8% of Democrats were
“satisfied with the way things were going in the United States.” Immediately
after Obama’s inauguration, the parties flipflopped: 18% of Democrats and 14% of
Republicans expressed satisfaction. That gap has only grown. In February
polls
, 20% of Democrats but only 10% of Republicans expressed
satisfaction.

The same pattern emerges in consumer confidence. ABC News
surveys surveys show that the
views of Republicans became 19 points more negative between October and
mid-April. Meanwhile, the views of Democrats improved by 10 points, even as the
economic news became grimmer.

Shaun April 16, 2009 at 2:02 pm

Unfortunately, it is not unexpected. As Tyler noted yesterday, the capacity for self-deception is great. I would like to see more research as to whether one side is more apt to skew events/trends to fit with their views. My hunch is probably not, but finding greater amounts of bias on one side would be interesting.

Crawdad April 16, 2009 at 2:14 pm

My pessimism meter has been pegged at the high end for some time. Maybe it has to do with how deplorable I find both political parties. Where do we more classical liberals fit into the picture? And my own pessimism is not just defined by economic measures either.

Alex R April 16, 2009 at 2:27 pm

I understand the point, and the data about perceptions of inflation and the deficit are striking, but the second part of the quote is just odd… They make a big deal out of the fact that pre- and post-election, Democrats and Republicans swapped in which party’s members thought that the economy was going well. But when at most 20% of the group in question answers “yes” to that question, I don’t see how you can consider the bias all that important: the relevant fact is that 80-90% of the members of *both* parties think the economy is *not* going well, and while you probably can attribute the difference between 80% and 90% to bias, these are both numbers that I would characterize as “vast majority” and draw no real distinction.

Furthermore, I would also suggest that the political bias is in some sense accurate: people of either party are likely to view the actions of those in power as leading indicators of what is likely to happen to the economy in the future, so Republican believe — accurately, from their perspective — that things are getting worse with Obama in power, and Democrats believe — again, accurately, from their perspective — that things are getting better.

Fence Sitter April 16, 2009 at 2:53 pm

Each side has a tendency to surround themselves with like thinkers and ideas.

Someone, an artist I think, did a project a few years ago where they took “People who bought X also bought Y” data from Amazon on political books — they mapped the network.

Not surprisingly, they found that people on the left smoked one dope, people on the right another. There was almost zero crossover.

We experience this in our own lives all the time — try being a moderate or a devil’s advocate at a dinner party. Ain’t fun.

Gabe April 16, 2009 at 3:35 pm

The False Left-Right Paradigm has trapped the minds of most people.

From Carrol Quigley:
“The argument that the two parties should represent opposed ideals and policies, one, perhaps, of the Right and the other of the Left, is a foolish idea acceptable only to doctrinaire and academic thinkers. ”

“In fact, this network, which we may identify as the Round Table Groups, has no aversion to cooperating with the Communists, or any other groups, and frequently does so.”

“In these actions of March 1935 and March 1936, Hitler was running no risk, for the government and the Milner Group had assured him beforehand that it would accept his actions”

Lord April 16, 2009 at 5:14 pm

The confusion here may be the difference between the present and expectations for the future. The economic state is poor, even the economic direction may not have changed yet, but ‘the way things are going’ may be interpreted to mean are we doing the right things and are they getting done? Do we expect things to improve in the future? Even if you expect things to get worse before getting better, you may still like ‘the way things are going’ because you see a better future, while if you don’t like what is being done you won’t like ‘the way things are going’ even if you expect eventual future improvement.

Phil April 16, 2009 at 11:10 pm

“Where do we more classical liberals fit into the picture?”

Dying. How many kids read Hume, Acton, Burke, Toqueville or Bastiat or any of those great thinkers?

They are getting a big dose of PC BS, with heavy egalitarianism as the youthful gateway drug for adult socialist tendencies in the classroom and in their entertainment. The fact that so many libertines, who confuse license, especially sexual anarchy-with liberty think of themselves as libertarians or classical liberals shows how effective the brainwashing has been.

Dictators always want to remove sexual restraint-very real oppression can occur unnoticed if people are busy chasin’ tail. Marx was wrong (about many things)-the opiate of the masses isn’t religion-it’s sex.

Rex Rhino April 17, 2009 at 1:08 am

They are getting a big dose of PC BS, with heavy egalitarianism as the youthful gateway drug for adult socialist tendencies in the classroom and in their entertainment. The fact that so many libertines, who confuse license, especially sexual anarchy-with liberty think of themselves as libertarians or classical liberals shows how effective the brainwashing has been.

Dictators always want to remove sexual restraint-very real oppression can occur unnoticed if people are busy chasin’ tail. Marx was wrong (about many things)-the opiate of the masses isn’t religion-it’s sex.

Absolutely not. The thing that killed Liberalism is that it has been absorbed into Conservativism and hijacked by religious extremists such as yourself. When it comes to the actions of consenting adults, there is absolutely no difference between liberty and license. Just because your religion requires you to view pleasure as “evil”, doesn’t mean that your desire for a morality-based police state is “Liberal”.

It is also totally clueless and laughable that you would try to conflate sexual freedom with the left, as anyone who has visited a university in the last 20 years can tell you is that sexuality is under constant assault from the feminist left and the Young Republicans are chasing tail with the best of them. Dictators have never wanted to remove sexual restraint, they have simply wanted to seize the apparatus of sexual control. Controlling who is allowed to have sex and under what circumstances, either directly through the state or indirectly through social pressure, is a way to control populations.

Conservatives sold out Liberalism for cheap grass-roots support from religious extremists, and then they are shocked when they had the rug pulled under from them when Socialists decided they could pander to social intolerance as easy as Conservatives do. You idiots got what you wanted, token “Gay Marriage is the Evil”, “The Only Birth Control is Abstinence”, “Earth was Created 3000 Years Ago” rhetoric from Republicans in exchange for Bush implementing a socialist economy so extreme that Democrats could only dream of up to that point. Obama is getting away with his antics simply because G. W. Bush set the Socialism bar so low, and your Christian-Right comrades are down to defect to Obama so long as Obama expresses some token homophobia and genophobia.

When you undermined the core concept of Liberalism, that peaceful consenting adults should be able to do whatever they want with themselves or their private property, you can’t really complain that others aren’t liberal enough. You are simply trying to pick and choose only those aspects of Liberalism that you happen to be comfortable with. It doesn’t work that way.

Phillip Capper April 17, 2009 at 1:33 am

I wonder how this phenomenon impacts on investment behaviour. I’m not American so, although I have my own political orientations, I am less emotionally caught up in the partisan rituals of Americans. So when I read the often rabid comments on the discussion boards on financial market news sites I am often taken with the extent to which bear and bull expectations seem to be linked to partisan positions.

If it is true that Republicans are more likely to be individual investors than Democrats (is this true?) then is it the case that one is more likely to see short selling and bear expectations when Democrats are in power?

Chris April 17, 2009 at 10:26 am

Dictators always want to remove sexual restraint

This is completely nuts. Dictators love bashing sexual deviants – Hitler put them in the camps right next to the Jews.

Moral panic is the lifeblood of dictatorship – the dictator is the only one standing between the country and the witches/homosexuals/Jews/Communists/drug dealers/terrorists, so anyone who tries to criticize him or reduce his powers is siding with the evil people.

Also – did the economic news really become grimmer from last fall to the present? ISTM that it consisted largely of uncovering landmines that everyone already knew or very strongly suspected were around here somewhere. Of course the world looks worse without the rose-colored glasses, but you’ve implicitly accepted that as soon as you realize your previous glasses *were* rose-colored.

What news has there been that was bad *and surprising*?

Phil April 17, 2009 at 12:35 pm

When it comes to the actions of consenting adults, there is absolutely no difference between
liberty and license.

Rex, you are my poster child. Dumbass, you don’t need to be religious to concede
that sex carries externalities. How many of those medical costs that the left constantly
blathers about as requiring a government insurance monopoly are attributable to HIV,
Chlamydia, HPV, Syphillis, Gonorrhea? Its time to grow up and ask important questions
and to see beyond your next ejaculation.

brian April 18, 2009 at 12:04 pm

Phil: “How many kids read Hume, Acton, Burke, Toqueville or Bastiat or any of those great thinkers?

They are getting a big dose of PC BS, with heavy egalitarianism as the youthful gateway drug for adult socialist tendencies in the classroom and in their entertainment.”

Two comments:

(1) I had never read Hume, Acton, Burke, Toqueville, or Bastiat UNTIL I got to college. In fact, all of the above were celebrated by my supposedly “left wing” professors. That’s why I don’t buy this “colleges poisoning our children’s minds” business. The only people who argue that haven’t been in a college classroom in a long time.

(2) I can’t take anyone who calls the Obama administration socialist seriously. For one, they have so far continued the failed policies of the Bush/Clinton era of practically zero regulation. Further, the definition of socialism requires the government to own and control the means of production. They’ve been very careful not to do this. When they came within a distant range of this (owning non-voting preferred stock in some banks) they immediately backed off (by converting it to common stock with no influence on the banks’ operations).

The word socialism gets through around too much these days to the point where it loses all meaning. In fact, it’s likely to make millions of people think that they are socialists, as they are constantly being told that what they believe in is socialism. That’s not a good thing.

AMS Laptop Battery May 18, 2009 at 10:54 am

So, as Paul Krugman still hates the current administration’s approach to the credit crisis and to fiscal stimulus, does that mean Krugman is unbiased?

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