Current Events
When I teach macroeconomics to the graduate students, one of the things I teach is Alberto Alesina and Guido Tabellini (1990), which builds models in which political parties produce budget deficits as part of a high-stakes and extremely dangerous game of "chicken" they play with each other. In his models, a right-of-center government that seeks a smaller government cuts taxes in order to leave a successor liberal government with a choice between drastically pruning back the size of the government or an Argentina-style budgetary and economic disaster. A left-of-center government, by contrast, that seeks a larger government share raises spending in order to leave a successor conservative government with a choice between drastically pruning back the size of the government or an Argentina-style budgetary and economic disaster. (Alberto's models do not work too well when applied to the Clinton administration.)
