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Republicans think America is doing terribly, but it isn’t

Photo by Scott Olson/Getty Images

Anyone watching the fourth Republican debate would be excused for thinking America is mired in a deep recession — that the economy is shrinking, foreign competitors are outpacing us, more Americans are uninsured, and innovators can't bring their ideas to market.

"We are a country that is being beaten on every front economically, militarily," sighed Donald Trump. "There is nothing that we do now to win."

"The most important question any of us can have is how do we get the economy growing?" Ted Cruz said. "How do we bring back economic growth?"

"We have to take our government back," said Carly Fiorina, "because innovation and entrepreneurship is crushed by the crushing load of a 73,000 page tax code" and "Obamacare isn’t helping anyone."

"What we are going through in this country is not simply an economic downturn," said Marco Rubio. "We are living through a massive economic transformation."

They would be surprised to find that unemployment is at 5 percent, America's recovery from the financial crisis has outpaced that of other developed nations, the percentage of uninsured Americans has been plummeting even as Obamacare has cost less than expected, and there's so much money flowing into new ideas and firms in the tech industry that observers are worried about a second tech bubble.

This beats even the markers the Republican Party established.

In 2008, for instance, Mitt Romney made headlines when he promised that "after a period of four years, by virtue of the policies we’d put in place, we’d get the unemployment rate down to 6 percent — perhaps a little lower."

We're now quite a bit lower than 6 percent, and in less than four years.

This leaves Republicans with two problems. The first is that the economy simply isn't as bad as they're making it out to be — so the apocalyptic rhetoric may well run into month after month of good jobs numbers during the general election. (Of course, if the economy unexpectedly falls into recession, then Republican rhetoric will look much better.)

The second is that Republicans are increasingly focused on economic problems they don't really know how to solve, and don't have much credibility to say they will solve.

Wage growth has been weak — but that's not something the assembled Republicans had much of an answer for. Donald Trump said he wouldn't raise the minimum wage because "wages [are] too high" already. Ben Carson agreed. "Only 19.8 percent of black teenagers have a job who are looking for one," he said, "and that’s because of those high wages."

Income inequality is also worryingly high, and Rand Paul tried to make that into a partisan cudgel. "The bottom line is, if you want less income inequality, move to a city with a Republican mayor or a state with a Republican governor," he said.

But of the 10 states with the highest inequality (as measured by 2010 Gini coefficients), six of them — Massachusetts, Louisiana, Florida, Alabama, Texas, and Tennessee — currently have a Republican governor.

If you cut the data a different way, by looking at the share of income held by the top 1 percent, Republicans still control six of the top 10. (To be fair, Republican control of Massachusetts is recent enough, and unusual enough, that it's probably fairer to say the split is 50-50 in both cases.)

If you take an international perspective, after-tax inequality is much lower in most European countries than it is in the US.

Paul's implausible attempt to blame governors and mayors for broad inequality trends aside, the simple fact is that the Republican tax plans will sharply increase after-tax inequality, and they will do so in the most obvious and mechanical of fashions: They will hugely cut taxes for the top 1 percent (and, making them yet more regressive, they will probably have to cut spending programs that benefit the poor to pay for those tax cuts).

Rubio Bush Trump tax cuts

Republicans also focus on the deficit, though less than they did in 2012. Towards the end of the last Republican debate, Carson observed that "$100 million has been added to our national debt" just during the course of the program.

The problem here, however, is that Republicans have entered into a disastrous arms race of ever more expensive tax plans that they have no way to pay for. The Committee for a Responsible Federal Budget released this graphic, which is based on the often optimistic estimates of the conservative Tax Foundation but still gives you a sense of how much these plans might cost:

Committee for a Responsible Federal Budget

As Jordan Weissmann observed at Slate, if Rubio's plan only cost $6 trillion — and some estimates place it nearer to $12 trillion — paying for it would require pretty much eliminating the entire defense budget, or the equivalent elsewhere in the government. And that's just not going to happen.

So Republicans are stuck between a description of the economy that seems increasingly detached from the reality of the recovery and a set of economic plans that actually worsen many of the problems Republicans say they want to solve. It's a pickle.

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