What is the Right's economic plan?

As far as I can tell, it doesn't have one. That needs to change.

It sounds almost crazy to hear it now, but back in 2014 or so, some friends were telling me that the Democrats were out of economic policy ideas. Whether that was true back then, it’s undeniable that the Dems now have a surfeit of ideas rather than a deficit. From grand investment plans to remake the country’s energy sector and halt climate change, to transformational cash welfare benefits, to reshoring supply chains, progressives stand ready to transform the American economy — if only that pesky Joe Manchin wouldn’t get in the way. And that’s not even to mention universal health care, student loan cancellation, housing YIMBYism, and so on.

But if Dems are once more the party of ideas, the GOP — and the broader conservative movement — look dangerously bereft. This is not a problem in electoral terms — the GOP can almost certainly win elections, including the upcoming midterms, based on nothing more than thermostatic politics, inflation, culture wars, and reactions against unpopular progressive slogans like “defund the police”. Indeed, the GOP seems poised to retake the Senate, and quite possibly the House as well. And if inflation doesn’t go away in the next couple of years, they’re well-positioned to win in 2024 as well.

Winning elections, however, is not the same as governing. If your idea of whether the country is flourishing is whether your political enemies are gnashing their teeth in anguish, then OK, fine, you don’t need a governing agenda. But a country whose politicians care more about hurting each other than building up the national economy is probably headed for decline. And even though the Democrats have plenty of plans, if Republicans have none, this means that the natural pendulum swings of thermostatic politics will leave us rudderless about half the time. It’s like trying to walk on one leg.

The plan last time

It worth noting that in the late 1970s and early 1980s, the conservatives who took over the country did have an economic plan (my favorite history of this, by the way, is Rick Perlstein’s Reaganland). It was a simple but powerful idea — cut taxes, cut spending, cut regulation. Get the government out of the way and the private sector will prosper. This program, promulgated in stump speeches and direct mail campaigns and the Wall Street Journal and even on PBS, helped Republicans’ electoral fortunes, giving voters a vision in which to invest their hopes for a more prosperous future. But even more importantly, it also gave direction to economic policy for three decades.

And I’m not saying that direction was exactly the right one. Ultimately, of course, excessive financial deregulation produced an epic crash in 2008. Tax cuts failed to pay for themselves and ballooned the deficit, and by the early 2000s they were clearly failing to have any noticeable effect on business investment or growth. Lack of a robust welfare state means inequality is much higher in the U.S. than in most other rich countries. Many would now argue that the U.S.’ lack of a real industrial policy allowed China to drain away much of our manufacturing base in the 2000s.

Even so, it would be wrong to call the Reagan program (or really, the Carter-Reagan-Clinton-Bush program, since the Democrats were responsible for much of its actual implementation) a failure. Most European and East Asian countries eventually engaged in some kind of neoliberal labor and product market reforms of their own, showing that the pressures motivating the free-market turn went well beyond U.S. politics. Welfare reform, though much reviled by progressives, generally had a neutral effect on poverty. Increased immigration, one of Reagan’s priorities, gave the country a large economic boost (while having little or no detectable effect on jobs). America has generally outgrown our rich-world peers, while also maintaining a steady lead in terms of living standards.

Not a bad performance, especially considering that inequality also increased in most of those countries as well.

Why Trumpism didn’t replace Reaganism

But I’m not really here to relitigate the Reaganite record. What’s undeniable is that most of this agenda is hitting a dead end. Tax cuts have become so obviously ineffectual that even Trump tried to frame his tax bill as a “reform” instead of a cut, and even that was decidedly unpopular. There’s little appetite for slashing welfare benefits, even though the public has also been cool toward the idea of adding new ones. The experience of Covid relief shows that government spending, especially in a crisis, remains popular. Trump consciously sought to distance himself from the Reagan program, refusing to bash New Deal era entitlements, denouncing free trade, and so on. It was a GOP administration and a GOP-controlled Senate that spent more on Covid relief than almost any other rich country, much of it in highly redistributive ways. So much for drowning government in a bathtub, eh?

But beyond the excellent response to the Covid crisis, Trump’s economic policy was a confused and chaotic mishmash. He threw the free trade consensus out the window, but his replacement — the trade war against China — ended up hurting our rival but hurting our own manufacturers (not to mention our own consumers) in the process. Meanwhile, Trump’s attempts at reshoring U.S. industry were risible — his plan to subsidize a huge electronics factory in rural Wisconsin failed spectacularly, and his attempts to jawbone factories into keeping jobs at home were utterly unsuccessful.

Now Biden appears to have stolen Trump’s thunder as the champion of made-in-America, even keeping the tariffs on China in place. At this point, if you want to reshore U.S. supply chains, you’re probably better off electing a Democrat than a Republican.

A few GOP politicians have flirted with the idea of working-class politics, but this seems mostly driven by educational polarization — the GOP is successfully appealing to non-college voters with cultural issues, so they figure they should lean into that with some rhetoric about the working class. But although Marco Rubio has made some overtures to unionism, and Tucker Carlson has featured union organizers on his show, so far this hasn’t been enough to overcome the GOP’s deep-rooted opposition to unions. Nor have Republicans been forthcoming with other ideas to help the economic situation of working Americans.

So far, therefore, there’s no coherent Republican plan to remake the U.S. economy. Trumpism hasn’t come together — or hasn’t yet come together — as a comprehensible, actionable set of policies. The GOP still has one ankle pinned underneath the desiccating hulk of the old Reagan program, unable to articulate an alternative.

The GOP needs more wonks

I don’t have a fully fleshed-out theory for why the GOP doesn’t have an economic vision yet, but there is one factor I see as contributing. Educational polarization itself has left the GOP without much of a class of college-educated people from which to draw public intellectuals to craft new ideas.

In academia, the situation is especially bad for the conservative movement. The professoriate always leaned to the left, but in recent decades that lean has become far stronger. In the 70s and 80s, academic economists like Milton Friedman made key contributions to the Reagan policy package; that looks less likely today. In the 2020s, the job of coming up with new GOP policy ideas falls mostly to a lonely bunch of think-tankers like Oren Cass and the folks at American Compass.

That isn’t a death sentence for Republican intellectualism, though. Even in the 80s, a lot of the people pushing Reaganism were just journalists, like Jude Wanniski or Ben Stein. In fact, writers are often the people who are most capable of crafting new idea packages — we read widely and draw in ideas from all kinds of sources, from academia and think tanks to the tech and finance industries to foreign countries. And we are uniquely skilled at synthesizing those ideas into packages that regular folks can understand.

Today, there are certainly writers who could serve in that role for the GOP and the conservative movement.

For example, in a widely read blog post last year, Scott Alexander suggested a class-focused program for Republicans. Some of it was culture-war stuff about wokeness and the media, but he also proposed banning discrimination based on college degree status. While that extreme policy is probably a non-starter, measures to improve the job market for Americans without college degrees might be an effective and welcome policy. Support for German-style apprenticeships, for example, might do this.

In another example, Bari Weiss hosted Andreessen Horowitz partner Katherine Boyle on her blog to talk about the need for America to get serious about its problems. I don’t agree with everything in that post, but it made many very good points. Boyle herself is an industrialist rather than a partisan, and her program could just as easily be adopted by Republicans as by Democrats:

Build housing for the middle class. Build schools for the kids who want to learn math. Build next-generation defense capabilities with young people who grew up coding. Build PCR tests so that a nasal swab stops the nation from closing businesses at the mere sight of Covid case increases. Build trade schools. Encourage men and women to work with their hands again. Cut the red tape that stops us from building infrastructure fast. Build factories in America. Build resiliency in the supply chain. Build work cultures that support mothers and fathers so they can have more children.

In fact, the GOP may have an easier time implementing some parts of a “build” agenda — Biden and the Dems are still fairly beholden to legacy environmental groups, as evidence by Biden’s reinstatement of environmental review for big infrastructure projects (a major source of NIMBYism).

Ideas like this need to be funneled into the Republican consciousness, and writers like Scott and Bari could be just the folks to do it.

The thing is, Scott and Bari are both fairly right-coded in the culture wars. That is not my judgement or my decision, simply my assessment of what I think most other people would think. If it were up to me, I would call them both “conservatives”, and it would be no insult. But I’m pretty sure that this would annoy either of them. As of 2022, people like Scott and Bari tend to see themselves as above the partisan fray, part of some neutral construct like the “Gray Tribe” or the “Intellectual Dark Web”.

Frankly, I don’t think this is a good thing. Sure, you’d never catch Scott or Bari at an anti-abortion rally or a Franklin Graham sermon. But ideological movements and partisan factions are the way nations actually translate ideas into policy packages. And when the only people willing to call themselves “conservatives” are the likes of Lauren Boebert and Madison Cawthorn, we have a problem. Because every few years those people’s faction wins power, and they need ideas better than the ones they have.

So I hope that the conservative movement gets more nerds on its side. I will not be one of these — I am simply always going to be left-coded in the culture wars, no matter how much I roll my eyes at the excesses of wokeness. But even I can see that having the GOP be a lurching, headless, brainless monster isn’t working out very well for the country.

Trump, the Great Recession, the China Shock, and the unrest of the 2010s blew up the economic orthodoxy. But in the ensuing years, it’s progressives and Democrats have come up with a blizzard of big new economic ideas. Conservatives and Republicans can’t ignore the idea deficit forever.

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