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6/4/2014 The Republican Case Against Republican Economics - NYTimes.

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The Republican Case Against Republican
JUNE 3, 2014
Thomas B. Edsall
After the 2012 presidential election, key Republicans began to criticize
their party’s opposition to immigration reform and gay rights. But now
party reformers are questioning something much more central: free-
market orthodoxy.
In an article in the May 26 edition of The Week — “What
conservatives don’t understand about the modern U.S. economy” — James
Pethokoukis of the American Enterprise Institute has issued an economic
challenge to the right from the right.
Pethokoukis’s piece is an assault on the economic manifesto that was
put out on May 16 by a conservative group that included three icons of the
right: Ted Cruz and Mike Lee, senators from Texas and Utah, respectively,
and Ed Meese, who served as attorney general under Ronald Reagan.
“This tired GOP sequel stumbles in its macroeconomic analysis,”
Pethokoukis writes, noting that the manifesto contains “no suggestion the
economy faces longer-term problems that predate Obamanomics.”
Pethokoukis argues that the manifesto’s anti-tax rhetoric fails to grasp that
“coping with America’s rising elderly population will require a higher
national tax burden in coming decades even with a reformed entitlement
system.” The conservative call for a balanced budget ignores the fact that
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“there is no evidence that markets fear a U.S. debt crisis.”
Pethokoukis is one of a number of conservative analysts who over the
past three years have undergone something of an intellectual conversion.
Michael Gerson, a speechwriter for President George W. Bush and now a
Washington Post columnist, and Peter J. Wehner, also a Bush
speechwriter and now a senior fellow at the Ethics and Public Policy
Center, published “A Conservative Vision of Government” in the winter
2014 edition of the journal National Affairs. Their essay is an attack on the
idea cherished by many Tea Party activists that all (or nearly all)
government action and intervention is bad.
Gerson and Wehner criticize the domination of Republican economic
policy by “rhetorical zeal and indiscipline in which virtually every
reference to government is negative, disparaging, and denigrating. It is
justified by an apocalyptic narrative of American life: We are fast
approaching a point of no return at which we stand to lose our basic
liberties and our national character.”
The two writers develop an argument rare in Republican circles. They
cite the liabilities of an economic worldview that doesn’t recognize the
need for government “to help those who cannot individually do for
themselves, to advance justice in an unjust world, and to lift up the
weakest members of society.” They go on to make the case that “many
conservatives fail to see the extent to which equal opportunity itself, a
central principle of our national self-understanding, is becoming harder to
achieve. It is a well-documented fact that, in recent years, economic
mobility has stalled for many poorer Americans, resulting in persistent
intergenerational inequality.”
Conservative reformers have sparked interest on the left, but some
liberal commentators remain distrustful of the willingness of intraparty
insurgents to seriously challenge Tea Party commitments.
E.J. Dionne Jr., writing in the most recent issue of Democracy,
contends that conservative reformers on the right “are far too timid in their
approaches to economic injustice and to the structural problems in the
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economic system.” Jonathan Chait takes a harder line in New York
magazine: “The reformers are massively understating the obstacles before
them. There are reasons Republicans have fought so hard to claw back
subsidies for the least fortunate. Active philosophical opposition to
redistribution is one. A general detachment from the poor is another. The
unforgiving zero-sum math of budgets, which means a dollar spent on
helping a Walmart mom is a dollar in higher taxes or lower defense or
politically painful cuts in retirement benefits, is a third. I do think the
Republican reformers can nudge their party to a better, or at least less
terrible, place. But I don’t think they’re being very straight about it.”
Both Chait and Dionne may be underestimating the significance of
dissent among conservative policy wonks.
The Republican Party is losing crucial support in presidential
elections among working class whites in the North and the Midwest.
In a prescient article published in November of 2011, Henry Olsen, a
senior fellow at the Ethics and Public Policy Center, wrote that “the
differences between white working-class independents and the GOP’s
conservative base are becoming too substantial to ignore. The GOP base
voter believes the deficit is as large a problem as the economy; the white
working-class independent does not. The GOP base voter believes cutting
entitlements is necessary to cut the deficit and that taxes on the rich
should not be raised; the white working-class independent disagrees.”
In other words, the conservative coalition, already facing
demographic challenges from the rise of minority voters, is likely to lose
core white support if it maintains its dominant anti-government ideology.
Once fissures have appeared in the conservative belief system, it will
become increasingly difficult to maintain hegemony – or, to mix
metaphors, you cannot unscramble a scrambled egg.
Conservatism, as currently construed, faces the risk of irrelevance if it
fails to address the consequences of globalization and automation, two of
the most powerful forces driving the hollowing-out of the middle-class job
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Pethokoukis points out that the Cruz-Lee-Meese manifesto fails to
acknowledge that “globalization and automation are playing a role. Going
forward, some economists fear a permanently bifurcated labor force with
rising pay for a slice of tech-savvy workers, and stagnant wages for
everyone else. It’s not all about Obama’s economy.”
Just four years ago, David Frum, still another former speechwriter for
George W. Bush, was fired by A.E.I. after sharply attacking Republican
refusals to negotiate with Democrats on Obamacare in March of 2010.
“We followed the most radical voices in the party and the movement, and
they led us to abject and irreversible defeat,” Frum declared. “Our
overheated talk,” he wrote, “mobilizes supporters – but by mobilizing
them with hysterical accusations and pseudo-information, overheated talk
has made it impossible for representatives to represent and elected leaders
to lead.”
In fact, few developments could prove more beneficial to the public at
large than for the left and right to compete over proposed strategies to deal
with globalization and automation. Liberals so far have been stymied
while conservatives have neglected these issues.
A major obstacle facing conservative reformers is the continued
support for the Tea Party within Republican ranks. An April survey by the
Pew Research Center found that the percentage of Republicans, and those
who lean Republican, who agree with the Tea Party is three times larger
than the percentage who disagree, 33 to 11, with 55 percent saying they
have no opinion.
This is a sharp decline from March 2010, when 48 percent agreed and
3 percent disagreed, but still a substantial roadblock for those seeking to
shift the direction of the party.
Another major problem facing reformers is the likelihood that
Republicans will do well in the 2014 elections. Stu Rothenberg, editor of
the Rothenberg Report, views Republicans as slightly favored to take over
the Senate; Charlie Cook of the Cook Report gives Republicans a 60
percent chance of taking the Senate. Virtually all analysts predict
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continued Republican control of the House. Winning will serve to mute
pressure to change and fuel further ideological calcification.
These hurdles leave reformers in a difficult position: To prove their
case, they need their party to fail. A Democratic victory in 2016 would
open the door for Republican insurgents and provide the kind of
credibility essential in politics. But conservative mutineers cannot afford to
be seen or heard rooting for defeat, even if that’s where their hearts lie.
© 2014 The New York Times Company