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Economic Populism

Tim Carney has an interesting take on where the GOP should go from here: economic populism. Now economic populism usually means what Obama practices: spread the wealth around class warfare. But Carney is advocating a different kind of populism:

The new Republican populism shouldn’t blame the “47 percent” of Mitt Romney’s imagination, or immigrants seeking to make a better life. The new Republican populism should declare war on the cronies and special interests who use big government to rig the game in their favor and deny opportunity to those trying to climb the ladder and live the American dream.

The GOP is out of power and it needs to play to the disaffected. The disaffected are not the wealthy, an obvious point that conservatives can’t seem to understand. The wealthy got wealthier under Obama, and corporations earned record profits while median family earnings fell. Obama uses these facts to defuse the charges he’s a socialist. Republicans should use them to show that Obama’s big government expands the privileges of the privileged class.

Instead of trying to convince successful people that Democrats will take away their wealth, why not explain to the middle class that big government is keeping them down?

When it came to picking up the economy, the Romney campaign seemed a little too focused on cutting taxes for job creators and businesses. That’s important, yes. But there is a growing perception among many Americans that these policies would be useless because the game is rigged. Banks and auto industries got handouts the rest of us paid for (or, more accurately, borrowed for). Our consumer choices narrow and wages fall. Millions have been out of work, not just for months but for years. And the perception is not that this is just a downturn; the perception is that something has gone deeply wrong.

We’ve talked about the issues underpinning this a million times: massive complex regulations that crush small business while favoring big ones; handouts to crony capitalists; tax loopholes; cable monopolies. Everything our government has done over the last 12 years has served to empower a narrow group of businesses and individuals. And those businesses that do rear up immediately start playing the Washington game, sometimes just to survive. This isn’t a problem of Barack Obama being a corrupt nincompoop. This is a problem of a system that favors corrupt nincompoops.

As bad as things are on the federal level, they are worse at the state and local level. The government of DC — entirely Democratic — has made cabs into a virtual monopoly and is fighting Uber, a private driver app. They recently passed a regulation, as many cities have, trying to effectively abolish food trucks (or at least bring them to heel for political donations and begging for waivers). The Institute for Justice has spent years fighting this, recently triumphing in a case to allow an order of monks to build caskets in defiance of a state-created oligarchy. And these are just two examples.

The Democrats have long charged that we don’t have a level playing field in this country. The Republicans need to jerk the rug out from under them by saying, “You know what? You’re right. And you know who made the playing field unlevel? You did.

John Huntsman dipped his toe in these waters during the primaries, calling for a tax structure that would slowly break up the “too big to fail” banks. But Romney, possibly because of his background, never talked about it. He dinged Obama on the auto bailouts but then claimed he’d have bailed them out in a different way. TARP never came up. He talked about streamlining regulation but only in the context of helping “job creators”; never in the context of fairness. He talked about tax reform in the context of supply-side economics; but never in the context of fairness. And I don’t mean fairness in the way the Democrats do, where you pay for my healthcare. I mean that we all play on a level field. That businesses rise and fall based on their performance, not on their ability to manipulate the tax and regulatory codes.

In the aftermath of the election, people think the GOP needs to change its philosophy and go liberal, despite the rightward shift of the voters. I don’t think that’s the case, per se. What they need to do is back out of the intellectual cul-de-sac they’ve wandered into with the same old talking points and make it clear why conservatism is good for everyone. Not because what benefits the wealthy or big business benefits the rest of us but because the playing field needs to be leveled. That’s an issue that can appeal to everyone — conservative, liberal and libertarian.

5 comments

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  1. davidst says:

    In a random political thread on a non-political forum, some guy pointed out that higher taxes on small businesses encourages them to invest profits. Your profits get taxed, your expenses don’t. Hence, wouldn’t higher taxes encourage reinvestment of profits into your business or other businesses to avoid losing the taxes? It seemed like a reasonable argument to me, but I don’t know much about actually running a business.

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  2. Biggie G says:

    The commenter’s name didn’t happen to be Muirgeo did it? This was his favorite argument when he was here.

    I was working on a long response, but it all boiled down to this…why should businesses have to engage in random unneeded spending just to avoid taxes?

    I am self-employed, but I don’t really own a business. I have no employees. When i do my taxes, business expenses come off the top before I calculate my profits on the Schedule C. The more expenses I have, the less profit, the less taxes I pay. I could buy a new computer every year. I could not shop around for insurance. I could only drive toll roads. I would rather have the money. If I pay an effective 25% tax rate, I have to spend $1000 to save $250 in taxes. Personally, I’d rather have the $750 to spend as I wish, not on unnecessary business expenses.

    Small businesses with employees have other needs for cash on hand. A business owner might want to pay off debt. He might want to keep some money on hand to cover payroll instead of laying off employees if there is a small downturn. He may want to self insure against equipment failure. He may want to institute a bonus or profit sharing plan.

    There are a thousand reasons to want to keep your profits. Making extra purchases to lower your tax liability is just stupid.

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  3. briggie says:

    Republicans should use them to show that Obama’s big government expands the privileges of the privileged class.

    Instead of trying to convince successful people that Democrats will take away their wealth, why not explain to the middle class that big government is keeping them down?

    That is all socialism is at the end of the day; modernized feudalism. What is going on right now seems to be eerily similar to what France went through in the mid 1800s.

    http://bastiat.org/en/government.html

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  4. Poosh says:

    Guess what, here’s a winning formula right here. It’s called “Sarah Palin.”

    Find someone who is more on the ball, but make sure s/he can FIGHT BACK against the smears that Palin failed to do, and you’re sorted. But everything else… and, come to think of it, her GODAMN RECORD, is right on the money.

    And now I am fuming. Sarah Palin, if not for a few glaring faults, is so perfect. She ticks so many boxes. She is a living refutation of all that bullshit liberals told you about women.

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  5. Shiftuser says:

    The idea that people and institutions should be rewarded or punished based on merit or lack thereof has died in this nation of “everyone-gets-a-trophy” whiners and brats. We don’t judge people or institutions based on the content of their character, but based on the content of their “free-candy-baskets”.

    Union members don’t get raises because they work hard and make the best products; they get raises simply because they are a warm body that shows up day in and day out every year. Welfare recipients don’t get food stamps, section 8 housing, and free cell phones and government checks based on how hard they are trying to find work…they get paid because they are great at making excuses and blaming everyone else.

    Conservatism, rugged individualism, and personal merit are on the decline because people don’t yet have to fend for themselves. I say let the country go over the fiscal cliff, let it crash and then those that survive will be those that always survive…the innovators, the self sufficient, the individualist who first takes care of themselves and their own. When the parasites die off from sucking on the dead corpse of liberal handouts, then conservatism will make a rebound and will rebuild. Only then will merit actually count for something again.

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