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What's the GOP message if the economy booms?

By David Frum, CNN Contributor
November 26, 2012 -- Updated 1654 GMT (0054 HKT)
A trader works at the New York Stock Exchange, which has seen rising prices due to optimism about the prospects of a
A trader works at the New York Stock Exchange, which has seen rising prices due to optimism about the prospects of a "fiscal cliff" deal.
STORY HIGHLIGHTS
  • David Frum says signs pointing to the economy gaining steam in next two years
  • He says household debt is down, consumer confidence is up, jobs are returning
  • Republican message in 2010, 2012 was that Obama's plan wasn't working, he says
  • Frum: GOP needs a new message if the Obama economy produces real gains

Editor's note: David Frum, a CNN contributor, is a contributing editor at Newsweek and The Daily Beast. He is the author of eight books, including a new novel "Patriots" and his post-election e-book, "Why Romney Lost." Frum was a special assistant to President George W. Bush from 2001 to 2002.

(CNN) -- Here's the next thing the Republican party needs to rethink. What does it say if and when the United States returns to prosperity?

For five years, U.S. politics have been shaped by economic hardship. In 2008 and 2010, voters rejected the party in power, booting Republicans out of the White House, and then sweeping Democrats out of Congress.

Mitt Romney campaigned in 2012 on the slogan, "Obama isn't working." President Obama responded by attacking Romney as out of touch, assuming (probably correctly) that he could not win by running on his record.

David Frum
David Frum

But the indicators are suggesting that by 2013 and 2014, the Obama record will begin to look a lot better, assuming, that is, that the two parties in Washington don't recklessly push the country off the fiscal cliff at the end of the year.

Opinion: How Republicans can bounce back

The nation's economy added 171,000 jobs in October 2012, for a total of almost 700,000 in the four months before Election Day. More than half the jobs lost in the crash of 2008-2009 have now been recovered, even as public-sector employment has shrunk by a net 500,000.

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The economy is recovering because consumers are less burdened by debt. They are paying down their credit cards, building home equity and strengthening their personal balance sheets.

As household debt burdens become lighter, consumers express more confidence. They are allowing themselves to spend a little more. They are even buying new homes again. Housing starts in October 2012 rose to a level 41.9% over a year before.

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Accelerating economic activity is rapidly reducing the budget deficit. The deficit has contracted since 2009 at the fastest rate since the end of World War II, faster even than during the late 1990s boom.

Wages remain flat, and will likely stay flat until unemployment contracts more, but Americans can begin to see better times ahead for the first time in a long time.

News: GOP resistance to anti-tax pledge grows

As they do glimpse that better future, two things will happen in politics:

1) President Obama will begin to claim more credit. In 2012, the word "stimulus" went unmentioned by Democrats. It was Republicans who tried to make political use of the $800 billion spent on job creation in 2009-2011. In 2013-2014, however, the shoe may suddenly rematerialize on the other foot.

2) Republicans will discover that their old "Obama isn't working" theme has become obsolete. By 2014, again assuming that Congress does not leap off the fiscal cliff, it will likely look as if Obama is working. What then? If negative messaging failed in 2012, it will fail bigger in 2014.

For too long, the Republicans have predicted apocalypse, debt crisis, the loss of freedom, the overthrow of the constitution. As the economy improves, that doom-saying will seem even more out of touch than ever.

Republican political chances will depend on the Republican ability to devise a positive program to address the country's fiscal problems in ways that improve people's lives. It's a new day, guys, and it demands a new game.

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The opinions expressed in this commentary are solely those of David Frum.

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