Writing at The Hill, Democratic strategist James Carville addresses a question much on the minds of Democratic activists and operatives everywhere: “Why do people vote against their interests?” Carville, co-author of “It’s the Middle Class, Stupid!” with TDS founding editor Stan Greenberg, focuses here more on the phenomena of well-off voters casting their ballots for Republicans — even when the record shows that the economy and the stock market do substantially better under Democratic Administrations.
A chief complaint of many Republicans is that Asian-Americans and Jews strongly support and vote for Democrats despite the affluent economic standing many have achieved. Similarly, Democratic strategists struggle to understand why 77 out the 100 poorest and most government-dependent counties in the United States voted for Mitt Romney in 2012.
But the people who consistently and overwhelmingly vote in large numbers against their interests are stock market investors.
I have no earthly idea why a stock market investor would vote Republican — all you have do is look at the numbers. The numbers are staggering, breathtaking and unimaginable. How anyone with even a penny in the market would vote for their interests and choose a Republican is unexplainable.
It’s true. One of the biggest myths in American politics is that the Republicans are better for business. Carville continues:
Since Obama was sworn in on Jan. 20, 2009, Standard & Poor’s 500 index has gone up approximately 115 percent, the Dow Jones industrial average has experienced a growth rate of 146 percent and, perhaps most impressively, Nasdaq has grown in size by 188 percent. Two thousand days into his presidency, the major stock indexes under Obama have had average gains of 142 percent — compare that to the record under Reagan, who saw gains at 88 percent during that same time period.
Russ Britt of MarketWatch notes, “the average stock-market gain under four post-Depression Democrats through each one’s 2,000th day in office has outpaced the average gain of the four Republicans in the era by a factor of nearly 4 to 1. Democratic gains have averaged 133%, while Republican market advances have had a mean of 33%.”
Obviously such stats have not been lost on Warren Buffet and a few more of the most savvy business leaders. For the most part, however, stock market investors and other well-off business leaders parrot the GOP party line that Obama and Democrats are bad for business — against all credible evidence. Nonetheless, as Carville concludes,
Political pundits will spend the next few months asking questions about presidential candidates’ qualifications and if they will be able to make tough decisions. The one thing we do know, thanks to history, is that that stock market is likely to do well if Democrats win. If the stock market is among your considerations, I will close with the findings of the two foremost experts on this topic and the larger comparisons of economies under Republican and Democratic presidents, Princeton University professors Mark W. Watson and Alan Blinder:
“The U.S. economy not only grows faster, according to real GDP and other measures, during Democratic versus Republican presidencies, it also produces more jobs, lowers the unemployment rate, generates higher corporate profits and investment, and turns in higher stock market returns. Indeed, it outperforms under almost all standard macroeconomic metrics.”
With such glaring facts and evidence, I ask stock investors to reexamine, reconsider and reinvest their confidence in the Democratic Party. Franklin Roosevelt was famously called by his fellow affluent Americans a “traitor to his class.” Well, if history was any guide, FDR wasn’t a traitor at all. He was the first in a series of Democratic presidents whose policies benefited the same wealthy people who railed against him.
Carville doesn’t probe the psychology of political self-delusion that leads so many business people to vote against their economic interests. A list of possible reasons might include the fact that not all successful business people are that smart, or even well-informed about the record Carville examines. Then there’s also the politics of resentment — some people are more comfortable voting their knee-jerk resentments over their interests. In the case of business people who voted against Obama and other Democratic candidates, there is probably some racism, thinly-disguised with a veneer of economic cliches that don’t hold up under scrutiny. And there will always be the tax-haters who like Republicans because they advocate reducing their taxes, along with gutting programs that benefit less well-off people.
In recent years, there has been an even larger discrepancy between the voting patterns of white working-class voters in many states and their economic interests, which are under almost constant assault by Republican politicians. From tax cuts for the rich financed by massive budget cuts for needed services, to undermining unions, opposing an increase the minimum wage, to restricting health care coverage, to outsourcing to refusing to invest in infrastructure upgrades, Republicans are engaged in relentless pursuit of policies that reduce the real income of workers. Yet majorities of white workers continue to vote for Republicans in most states.
It’s regrettable that so many voters don’t look at the big picture, and get it that the economy does better under Democratic leadership, which benefits everyone and gives America a more livable society. No magic cures here. As always, the only remedy for ignorance is education. Dems have to do a better job of widely-sharing the economic realities Carville has presented here.