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Non-Strategic Retirement

Senator Bayh’s retirement announcement reminds me of a point I’ve made before (also here) but I think is worth making again: National swings between the two parties are amplified by politicians’ natural tendency to stay put when things are going well and retire when the political climate looks stormy.

Here’s the long version:

One thing I learned in econ class in 11th grade was that government policy should be counter-cyclical (spending more in recessions and cutting back in boom times), but that there’s a lot of pressure to be pro-cyclical, which will tend to exacerbate business cycles. (Except I suppose they didn’t say “exacerbate” in 11th grade.) At a personal level, too, it’s natural to spend more when we have more and cut back when we aren’t doing so well. Every now and then you hear about a “rainy day fund” but my general impression is that these are never big enough to counter the business cycle.

Political parties seem to apply a similar pro-cyclical behavior in their congressional election campaigns. Consider 2008, which was expected to be a good year for the Democrats, and so should’ve be the time for them to make some investments in new, young candidates. They should’ve encouraged lots of their incumbents to retire, because in 2008, they were set to win a lot of these districts without needing the incumbency advantage (estimated to be about 10% of the vote, i.e., enough to take you from 50% to 60%). Conversely, that was the time for the Republican Party to hold on to what it had, and to keep all their incumbents in, trying to hold out until 2010 when the pendulum might swing back in their favor. [Yes, I originally wrote this back in 2008. We could see the pendulum swing coming back then!]

But this sort of strategically-planned retirement doesn’t actually occur. Actually, something like 30 Republican House members retired in 2008. Republicans retiring, Democrats sticking around—that was a recipe for big Democratic gains that year. But then in 2010, or 2014, or whatever year it is when the Democrats get wiped out—then a bunch of their incumbents will probably retire, and boy will the Democrats wished they had put in younger incumbents back in 2008 when they had a chance!

One of the difficulties here is that I’m talking about the long-term goals of the parties, but “the parties” are, to a large extent, simply their officeholders. And congressmembers’ incentives can be much different from those of the party as a whole. In particular, it makes sense that an incumbent congressmember will want to quit in a year when he or she would be facing a tough reelection battle, and when the prize for winning is to remain in the minority. Conversely, why step down when you’re facing an easy reelection and the prospect of some juicy committee assignments? So the individual officeholders have an incentive for pro-cyclical behavior, even if it harms their party’s long-term interest.

Beyond the benefits or lack thereof to the individual parties, pro-cyclical behavior would seem to increase the size of political changes, making the swings in congressional representation larger than would be expected simply based on swings in public opinion. Actually, many political scientists would consider this a good thing (an increased “swing ratio”); my point here is that some of this swing is “endogenous” in the sense of arising from pro-cyclical decisions of individual congressmembers deciding whether to run for reelection. It would be interesting to see if this happens with state legislatures as well.

We also see this in the Senate. For example, 84-year-old Frank Lautenberg ran for reelection in New Jersey in 2008. This in a Democratic year when the Democrats might have done well with just about anybody. (Or maybe not; I don’t really follow New Jersey politics and am just extrapolating from national polls.) In 2014, they’re going to need to find someone new, and at that point they might wish they had an incumbent already in the slot.

This year, Evan Bayh and other swing-state Democrats are retiring, and this sort of pro-cyclical behavior is set to amplify the national opinion swing and make the swing in congressional seats even larger than it otherwise would be.