Why We Are In So Much Trouble

Reihan Salam describes Christieism as being a politics that “connects the burden of a bloated and inefficient government with the everyday struggles of working Americans. “  Fair enough, but we are going to need more than this Christieism.  As Salam mentions in his essay these other needed reforms include,

1. Reform of the quasi-public health care sector so that we get greater productivity out of the limited dollars (whatever those limits are) that we spend on health care by getting providers to attract consumers through price and quality competition.

2.  Reform old age entitlements so that high earners pay somewhat lower taxes during their working years but get somewhat fewer benefits during their retirements (though there will still be something there - it will just be less than is presently promised.)  The alternative is an unreformed benefit system where rising taxes strangle growth and those same “high earners” (who will be fewer than otherwise) retire into a poorer country with poorer children and grandchildren.

Salam summed up this brand of politics by writing “Republicans need to articulate in the 2012 election: not anti-government, but better government. Not opposed to a safety net that helps working Americans get back on their feet, but against entitlements so inefficient and expensive that they crowd out everything else we want to achieve as a country.”  Call it Danielsism (as in Mitch Daniels.)

I don’t see any Republican presidential candidate who is going to eloquently defend such a program to persuadable voters in 2012 or effectively pursue that program as President.  Cain is focusing on a tax plan that will slightly enlarge our already unsustainable budget deficit, raise taxes on the middle-class and working poor, and sharply cut taxes on the highest earners.   The budget deficit stuff probably doesn’t matter.  It is only a small increase in the deficit and politically, all Cain has to do is deny the deficit increasing impact of his tax policies.  That is really all it takes when the voters already want to vote for you and your deficit increasing program.  It worked for Reagan in 1980 and it worked for Obama in 2008.  There is no reason why it shouldn’t work for Cain.  That his tax plan might leave the working poor and some of the middle-class paying a larger proportion of their income in federal taxes than high earners will be a bigger problem.  This will kill Cain if something else doesn’t get him first.  It might not do it right away.  People are focused on things other than the distributional impact of Cain’s tax policies.  There is probably some nontrivial (and mostly non-rich) fraction of the Republican primary electorate that favors having high earners pay a lower fraction of their income in taxes than the working poor and the lower middle-class as a matter of justice.  But if and when there is sustained attention to the distributional problems in the 9-9-9 plan, survival instincts will kick in.  And Cain is still in favor of moving to a  30% or more national sales tax  with all of its attendant political, distributional and enforcement problems.   Go into an election with that tax program, and the Republicans will lose.  If it ever gets that far, Republican primary voters will see that, and look elsewhere.

The less said about Perry the better.  He might actually have solid smaller government instincts, but his main contribution to the debate has been to become a cautionary example about why center-right politicians who aspire to be President shouldn’t strike tough guy poses about entitlements.

Salam described Romney as having a “track record as a Mr. Fix-It in both business and government. As governor of Massachusetts, he proved innovative, nimble and smart.”  All true, but nothing in Romney’s political career indicates that Romney is the guy we need for the challenges we face.  We in Massachusetts did have a reformist Republican governor who made major center-right structural changes to the government.  Unfortunately for the country, that governor was Bill Weld.  Romney’s main policy legacy in Massachusetts is Romneycare.  Now I think Romneycare was an idea worth trying, but it turned out to be a bad idea and Romney hasn’t come up with a convincing explanation about why the model of health care financing in Romneycare (which is basically the same model of health care financing in Obamacare) is a good or bad idea.  He is so lucky to have been gifted by the incompetence and laziness of primary opponents who haven’t put in the effort to make the case against Romneycare.

But is Romney the guy to advance Danielsism (or whatever you want to call it?)  The health care and entitlement reform ideas behind Danielsism aren’t popular.  Neither are the much higher tax and centrally rationed medical care policies of the social democratic alternative to Danielsism.  Most people would prefer a painless policy that is not possible.  Any real reform movement of left or right is going to face enormous resistance. 

Enacting and implementing even a moderate and prudent version of Danielsism would include united and mobilized resistance from the majority of the Democratic coalition, their media allies and sympathetic media outlets that don’t formally affiliate and left-of-center.  They will do everything they can to scare the pants off people.  The resistance to Danielsism would include powerful interest groups who aren’t always aligned with one of the two parties (the AARP and hospital groups come to mind.)  Any President who seriously pushed Danielsism would face a storm, their poll ratings would dip initially, and some allies would run for cover.  On a smaller scale, something similar happened to Daniels in his first term and is happening right now to governors Scott Walker and John Kasich.  The difference is that Danielsism would be a bigger change for more people than anything Walker or Kasich have done and the pushback would be bigger for any conservative reformist president. 

Is Romney the guy to persist under those circumstances?  Romney’s record is of a guy who changes his opinions to agree with the plurality of whatever constituency he is pursuing (Massachusetts general election voters, Republican presidential primary voters.)  One can easily picture a conservative reform agenda’s support sinking (however temporarily) to the thirties in the polls, the center-left coalition mobilizing hundreds of thousands of protesters in the street and tens of millions of dollars of television ads and hysterical, politically slanted “news” stories in the media that is mostly consumed by persuadables.  Does anyone want to bet that Romney will, for the first time in his political career, show great commitment to principles that have become (very) inconvenient?  If Romney doesn’t have that commitment in him and he buckles, where does that leave us as the country hurtles toward bankruptcy?

The economic challenge facing the 2012 Republican presidential candidate will require a Margaret Thatcher-level of principled commitment to center-right reform (though such commitment will not, in itself, suffice.)  The evidence of his political career is that Romney would more likely turn out to be an Edward Heath or a Kostas Karamanlis (though without the corruption) than a Thatcher.

If I seem a little pessimistic, consider the obstacles to enacting Danielsism,

1.  The ambiguous and anxious state of public opinion relating to issues of entitlement and health care policy.

2.  The structure of present-day interest group politics.

3.  The various procedural and constitutional veto points within the American political system.

4.  The inherent tension in crafting a program ambitious enough to deal with our problems and prudent enough to garner sufficient public support.

I don’t think enacting Danielsism is impossible, but it will take skilled, determined leadership at the presidential level if we are to get the center-right reforms we need in the next few years.  I see the potential for that leadership in several Republican politicians.  None of them are running for President.  I don’t see it in Romney.  I really hope I’m wrong.