OPINION: How Much Influence Does the President Actually Have on the Economy?

Author: Edgar Wilson
Created: 29 October, 2015
Updated: 18 October, 2022
5 min read

The third Republican primary debate was, deservedly, a train wreck.

What went wrong had effectively nothing to do with the candidates themselves, which could almost be refreshing if it weren’t for what did actually derail the event.

The moderators from CNBC stand to lose more public support than any of the actual candidates, given their mishandling of everything from pre-debate research to managing time-limits. Of course, the whole spectacle was doomed from the start, since it was contrived as a debate focusing on economic issues, an area in which the president—any president—has an unambiguously limited role to play.

The president can inspire confidence (or sap it) but the economics of the presidency are pretty thin. Party doesn’t seem to matter half as much as both parties insist, and lest we forget, the president does not set policy or move laws through Congress—the legislative branch does, and the president merely signs (or doesn’t sign) the final product.

Certainly, the president and his or her cadre of administrators and cohorts can lean on individual members of Congress, call in favors, and take advantage of friendships, but that is a far cry from the rhetoric of economic management we get from presidential candidates.

The reality is that presidential elections consistently spur the highest turnout of any U.S. election precisely because people buy into the One Official to Rule Them All notion that surrounds presidential elections. The media plays directly into the narrative of ‘electoral charters’ whereby the presidency acts as a litmus test for how American voters are feeling—as though that sentiment isn’t as flighty as a hummingbird and prone to hourly fluctuations over the four-year terms of the president.

Visibility has become chronically mistaken for influence in the executive branch, and everyone -- from the candidates, to the media, to the voting public -- has decided to play along.

Whatever their personal politics, voters clearly apply an electoral form of Reaganomics to federal policy: they stack all their votes on the presidency, and expect cohesive, effective policy to trickle down through the other branches and move the whole country in a more desirable direction.

It doesn’t work—and not because the bureaucrats at the top are greedy and keep all the policy to themselves, but because that is precisely the opposite of how the American Experiment was designed to function.

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Alas, in this election, as in countless elections past, all indications are that the presidential candidates will campaign as lawmakers, the lawmakers will campaign as party lackeys either for or against the president, and the voters will turn out in droves to endorse the whole travesty -- red, blue, and purple.

Thus, amid the turmoil of the moderators fending off attacks from the candidates on their competence and integrity as journalists, we were treated to a few of the same platitudes we’ve heard along the campaign trail from the candidates to convey how, in a monarchical fantasy, they would compel all the moving parts of the American economy to fall into line.

As has become typical, facts were rare but ambitions abounded. Ben Carson did offer a number—15%--as the core of his flat-tax plan, while Donald Trump continued his habit of getting great results (in this case, eliminating the deficit and creating “many millions of jobs”) without so much as a whiff of explanation as to how.

Carly Fiorina continued to tout her mixed business record, conflating the role of a chief executive officer in the private market with the capacity of the country’s chief executive to create or preserve jobs.

And of course, talk of defense—an area of actual authority for the president—hinged on defense spending, something the president is decidedly not responsible for determining.

Though the candidates tried to spar on some of the specifics of tax reform (beyond a flat income tax rate), they cumulatively touched only on a few of the leading issues in taxation, choosing instead to offer bland platitudes about fairness and securing the future.

They mostly agreed that Social Security, Medicaid, and Medicare all need reform—a legislative initiative—and offered no clear actions they could take as president to start the process.

As always, it all boiled down to a few half-baked ideas that they promise to earnestly present to Congress and defend in the media, while the lawmaking process takes its own, inevitable course.

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Whoever wins—regardless of which party they come from—is going to spend the bulk of his or her first term firmly in the wake of the Obama administration, and the macroeconomic patterns that continue to fall, like dominos, regardless of all the rhetoric and micro-influences the new administration attempts to control.

We can pretty well count on the next president to claim credit for any of the good numbers, and blame Obama for any bad numbers, and offer no coherent explanation as to why any combination of inherently short-term efforts can possibly explain either outcome.

The election, much like the announcement or even rumor of new policy, can certainly have an influence over limited economic events, but the long-range patterns and trends that really define the economy will continue to be driven by much larger forces that the president can neither control nor even affect in the span of four or eight years.

In the end, any rhetoric from the candidates regarding the economy—much less an entire debate focused on economic policy—serves to do little more than draw arbitrary distinctions between individuals who represent little more than small cogs in a vast machine. It is time we stop expecting more from our candidates, and believing them when they say they can deliver on anything of consequence in the economy.

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