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The Retirement Paradox: What’s Strategic for the Politician is Not So Good for the Party

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. As expected, it was a good year for the Democrats, and so it was a logical time for them, as a party, to make some investments in new, young candidates. 2008 was the time they should’ve encourage lots of their incumbents to retire, because in that year they could 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, 2008 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. But we didn’t see that—actually, something like 30 Republican House members retired in 2008. Republicans retiring, Democrats sticking around–that was a recipe for big Democratic gains. 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!

This election cycle we’ve been seeing this happen from the other direction:

Democratic Senators Christopher Dodd of Connecticut and Byron Dorgan of North Dakota announced this week that they would retire from their long-held seats rather than face uphill battles in this year’s midterm elections. Several House Democrats from conservative districts have said they will step down. The Democratic governor of Colorado, Bill Ritter, has made the same decision.

The flip side of this was in 2008, when 84-year-old Frank Lautenberg ran for reelection in New Jersey. That was a Democratic year when the Democrats might’ve done well with just about anybody. (Or maybe not; I don’t really follow New Jersey politics and am just extrapolating from national polls.) When 2014 rolls around, they’re going to need to find someone new, and at that point they might wish they had an incumbent already in the slot.

What makes sense for the individual officeholder–stay in when you think you’ll have an easy win, and wait to quit when the going is getting tough–isn’t so helpful for the national party.

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.