Did President Barack Obama correctly sell the $787 billion stimulus
package? Since it has been enacted into law by Congress and signed by
the president, one might answer yes. But the fact that the bill passed
with little Republican support could say otherwise, argue two
A new study by Neil Malhotra and Yotam Margalit suggests that
Obama’s political strategists might have gotten even more than $787
billion if they had relied less on Democratic Party lawmakers to sell
the package and expended more time and effort arguing for the merits of
the package early on. Moreover, to get more support from Republican
voters, Obama could have avoided blaming the financial crisis on the
Republican Party and the Bush administration and been more alarmist
about the consequences.
Today, amid the faltering economy, the Obama administration must
still rally the American public around the plan. In the future other
stimulus packages may need to be passed, including more asset purchases
and the creation of a bad bank of problem loans. The study outlines a
few key tactics the president might employ.
Understanding how citizens construct opinions about the preferred
policy for dealing with the economic crisis has important applications
for gauging how the battle over public opinion is likely to shape up in
the months ahead, the authors write.
Malhotra, an assistant professor of political economy at the
Stanford Graduate School of Business, and Margalit, an assistant
professor at Columbia University, surveyed almost 3,000 U.S. adults in
late January and early February 2009, probing to find the factors that
shape the American public’s preferences regarding the government’s
The American public is sensitive to cues, such as endorsements and
the blame game, and uses them to construct attitudes on the complex
issue of the stimulus package, the authors write.
One of the striking findings is that high-income and lower-income
citizens have drastically different responses to how the stimulus
package is framed. High-income citizens appear to be more risk-averse,
supporting the stimulus program at higher rates when it is framed as
preventing a collapse, as opposed to a program designed to boost
the economy. Attitudes of low-income citizens were just the opposite.
In addition, Malhotra and Margalit found that support for the
proposal differed depending on whether the question was presented as an
initiative of the Democratic Party, one of the Obama administration, or
the federal government. When Republicans were asked about an economic
stimulus plan drawn up by policymakers in the Democratic Party, they
were less likely to support it. They were more supportive if the
question attributed the proposal to President Obama and his team or
policymakers in the federal government.
Another bias participants exhibited is a sensitivity to how an issue
is framed—is the glass half full or half empty? Despite the fact that
they may have well-reasoned opinions about the topic, People may be
more likely to support policies such as the stimulus package that are
seen as high-risk when they are framed as preventing catastrophic
outcomes as opposed to promoting beneficial ones, the authors wrote.
The Obama administration correctly assumed it needed to keep the
size of the stimulus package under $1 trillion. Malhotra and Margalit
found that support among survey participants declined
substantially—especially among Republicans and independents—when the
cost was presented as $1 trillion versus $900 billion. It didn't matter
much, they found, if the cost was $1.1 trillion or $1.4 trillion;
sensitivity to the trillion-dollar threshold was paramount.
The study's findings have implications for how the Obama
administration should go about gaining public support for the package.
It also points up some of the strategies the president should and
should not have employed in marketing it.
Early on, Obama sought broad support for the stimulus beyond his own
party's base by inviting Republican leaders to the White House and
sending key aides to Capitol Hill. But the effort largely failed as the
bill gained the vote of only three moderate Republican senators; no
Republicans voted for it in the House.
The authors suggest that Obama's political strategy should have
differed, depending on whether he was trying to gain bipartisan support
for the stimulus bill, or to solidify support within the Democratic
base and some independents. If going for broad support, he needed to
describe the proposal as one he himself owned, keeping the Democratic
Party out of the limelight. If he wanted to gain more Republican
support, he should have avoided blaming the financial crisis on Bush.
And, If he solely wanted to gain Democratic support, he should have
pushed through a bigger plan, Malhotra says. It seems like Democrats
were insensitive to price. However, independents were leery of the plan
exceeding $1 trillion. Malhotra says Obama made the plan more
palatable to Republicans by: Emphasizing the catastrophic consequences
if the plan had not been passed, and keeping [cost] below $1 trillion.
In the future, when out stumping for the package, the president
should carefully consider his audience. If it is well-to-do, frame the
proposal as necessary for avoiding a sharp downturn, the study
suggests. Otherwise, emphasize the potential growth that the stimulus
may help instigate.