Carrots and Sticks: Punishment and Party Power in Congress∗

This paper proposes a dual-utility theory of parties in a legislature. In this theory a legislator has preferences over both actions and policy outcomes. Specifically, a legislator’s utility is determined by position taking—his own votes—and by partisan utility which depends on policy implemented by the legislature. Party leaders design mechanisms that make legislators better off by co-ordinating votes and compensating those legislators that vote against the interests of their constitutents. The model produces two main findings. First, party leaders are more likely to use promises of rewards and threats of punishment as the size of the party or the benefit of passing the party’s policy platform increases. Secondly, and perhaps counter-intuitively, party leaders become less likely to use rewards and punishments when the number of centrist legislators increases, or the costs to centrist legislators increase. ∗Thanks to Keith Krehbiel, David Baron Gerard Padró-i-Miquel, Ernesto Dal Bó and COWBELL for useful conversations and encouragement. I gratefully acknowledge the support of the SIEPR Dissertation Fellowship. Tom Delay and Carl Albert were both leaders of the majority party in the U.S. House of Representatives. Beyond an occupation and similarly limited physical stature, these two men had very little in common. Delay was a master of threatening and cajoling majority party members into voting for the party’s policy platform. He doled out record amounts of campaign funds to loyal party members through his political action committees and associated lobbyists. He coordinated schemes to transfer funds between candidates. His less pleasant side was exposed by his habit of threatening to run a primary challenger against disobedient legislators (Dubose and Reid, 2004). Albert, on the other hand, has been characterized as “inactive and weak.” Aside from the men themselves, the caucus rules governing the conduct of party leaders were vastly different during the times when Delay and Albert were party leaders. Albert lead during a time when caucus rules and norms enhanced the standing of committee and subcommittee chairs at the expense of party leaders. When Delay entered the leadership, his party caucus approved rules that increased the role of party leaders in selecting and maintaining committee chairs and committee membership, along with other reforms that enhanced the standing of party leadership. This paper examines two interrelated questions suggested by the previous paragraphs. First, when will legislators choose leaders—and rules that will allow leaders—to use threats of punishment or the promise of rewards to pass policy? Second, if legislators wish their party leaders to take an active role, under what conditions will they prefer a regime that focuses on the use of threats of punishment to a regime that uses the promise of rewards? The dual-utility model presented in this paper makes two main assumptions. First, party leaders in Congress, and the rules that govern their behavior, are selected by party legislators. Second, departing from the standard spatial model, legislators derive benefit from two sources. First, legislators have preferences over their own actions: position-taking The quote is from Cox and McCubbins (1993, p. 156). See also Peters (1997, pp. 174-175). Albert did not see himself as particularly ineffective, although there is little data to defend his position (Albert and Goble, 1990).