The last week has been sort of depressing when it comes to intra-Republican economic politics. You had the RNC report that ignored the public’s problematic perception of the Republicans as the party of the rich while implicitly blaming social conservatives and explicitly blaming opponents of “comprehensive” amnesty for the party’s troubles. The hottest Republican of the moment (Rand Paul) had just produced a flat tax proposal that would have raised taxes on the middle-class and sharply cut taxes on high earners. It looked like we were stuck with the dynamic Ross Douthat described in which the Republican establishment is insufficient and the “populist” Republican response is a crazyland exaggeration of the Republican establishment’s policy vices.
Enter James Capretta. Capretta smartly takes as his model the best speech given by any politician in 2012. That was Bill Clinton’s Democratic National Convention speech in which Clinton (to use the words of a commenter here) spoke to his audience as reasoning adults. Clinton included a theory of the Great Recession, an explanation of the policies that Obama had implemented to repair the damage, and an explanation for why the progress had been so slow.
Capretta explains that Republicans need to make the argument for the causes of the crash of 2009 while offering a mix of short-term and long-term policies that will boost growth. Capretta is especially good with why it is a bad idea to respond to an economic downturn with monetary tightening in a low inflation environment. He also suggests Republicans should have supported extending the payroll tax cut that expired at the end of 2012. My description is not doing Capretta justice. This should be required reading.