Some Thoughts on Conservative Reform

 

Paul-RyanNational Review’s Rich Lowry points out this odd WSJ editorial regarding Paul Ryan’s speech last week:

This isn’t enough for Mr. Ryan’s critics, and readers should understand their self-serving motives. For progressives, the goal is to use Mr. Trump as a wedge to produce even wider GOP divisions and drive a stake in Mr. Ryan’s politics of growth and upward mobility. … On the other side are a cast of conservative intellectuals who don’t like Mr. Ryan because he continues to believe in the Ronald Reagan-Jack Kemp vision of a tax-reforming, free-market GOP that focuses on economic growth. They think the GOP needs a policy mix to address income inequality and promote redistribution—albeit to the middle class—rather than aiming for faster growth …

They’d love to volunteer Mr. Ryan for a kamikaze political mission that leaves someone else to pick up the rubble in 2020. This year most of this crowd wanted Marco Rubio, who adopted many of their ideas, but perhaps you don’t recall how “wage enhancement” and a new $2,500 tax credit for children stirred the masses. Mr. Ryan is doing fine on his own and he can afford to ignore this left-right advice. The Speaker hasn’t hesitated to condemn Mr. Trump’s bad ideas on the merits as they arise, including his Muslim travel ban. But Mr. Ryan also has other obligations, not least protecting the GOP from larger damage this election year. …

The irony is that many of the same pundits now demanding that Mr. Ryan become their sword against Mr. Trump also praised the New Yorker last summer for his challenge to GOP orthodoxy. These former Trump apologists claimed the GOP should absorb his rage against the status quo. Instead of income-tax rate cuts, get behind family-friendly tax credits. Make peace with the entitlement state. Restrict trade and immigration allegedly to lift blue-collar wages. Alas for these would-be king-makers, Mr. Trump doesn’t take much advice. The Trump insurgency has a long way to play out, and someone else could still win the GOP nomination. But whatever happens, Mr. Ryan and his political allies will have to limit the policy and political damage. That means preserving a vision of the GOP as a pro-growth, reform party that is inclusive and meets the challenges of the current era. Mr. Ryan knows how to do that better than his critics do.

Lowry tacks on this note: “I have trouble fathoming whom these passages could accurately describe, and since the Journal doesn’t provide any names, the mystery will have to live on.”

One might think the WSJ was referring to conservative reformers, or “reformocons.” Except I don’t know any who are “Trump apologists.” Or who downplay the importance of faster economic growth. Or are protectionists. Or think tax rates unimportant.

Speaking for myself, my point about all this is that center-right policymakers should analyze today’s challenges — not those of 2000 or 1990 or 1980 — and apply modern, evidence-driven, creative problem-solving informed by timeless American values. And in doing this, it doesn’t seem to me that lowering the top marginal tax rate for labor income to where it was during the 1920s should be the numero uno priority. More on this in my recent The Week column …

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  1. Bryan G. Stephens Thatcher
    Bryan G. Stephens
    @BryanGStephens

    All I can say is that “They” always have a lot to answer for!

    • #1
  2. Rodin Member
    Rodin
    @Rodin

    You are not going to love everything an effective politician does — particularly the broader the national constituency required for effective action. Ryan held his nose and let the last budget go by as it was basically cooked and wanted to clear the decks for this year. Already he has marched down the path he announced. And I, for one, am prepared to back his current play. I think he (and we) would be ill-served in the long run to divert him from the current path. He will play an important role in either an opposition party, an ally to Cruz constitutionalism, or a containment function in Trump statism.

    • #2
  3. erazoner Coolidge
    erazoner
    @erazoner

    “Make peace with the entitlement state.”

    What a pregnant clause. We used to call that “kicking the can down the road.” I guess that’s hackneyed, and the path to insolvency is irreversible, so we may as well not discuss it any longer.

    Rick Santelli, call your office.

    • #3
  4. KC Mulville Inactive
    KC Mulville
    @KCMulville

    When GOP politicians say “growth,” that can mean a variety of things.

    What voters like me want to hear is “jobs.” Since the vast majority of Americans make money through labor, that’s what the vast majority of us want to hear. If the stock market expands but there are few jobs, that would be called “growth,” but who cares? That kind of growth is irrelevant to me. I need growth that expands jobs. More jobs mean employers must compete for my skills, and that drives up wages for everyone. I don’t give a damn about “growth” unless it translates into jobs.

    • #4
  5. Fricosis Guy Listener
    Fricosis Guy
    @FricosisGuy

    The rationalizations for the Dubya domestic agenda sound a lot like the rationale for the reformicon agenda.

    • #5
  6. Instugator Thatcher
    Instugator
    @Instugator

    Confusing – particularly when you say in your column that

    Ryan: “I think most people don’t think, ‘John’s success comes at my expense.’ Or, ‘My success comes at your expense.’ People don’t think like that. People want to know the deck is fair. Bernie Sanders talks about that stuff. That’s not who we are.”

    means, in your words,

    In other words, Republicans should keep deeply cutting taxes for the richest Americans — as part of across-the-board tax cuts — and not give any special preference to targeted or direct middle-class tax relief.

    particularly when you summarize the Camp plan with

    That 2014 big-bang tax reform plan by Camp would have likely increased the size of the economy by less than one percent over the next decade.

    Followed by (in your words)

    Ryan’s professed politics are also dodgy. Most middle-class Americans seem to think they’re already paying their fair share in taxes.

    Then you fail to acknowledge the actual conclusion of the Camp analysis which says (emphasis added)

    Broadening of the individual and corporate income tax bases through elimination of many preferences in the form of deductions, exemptions, and tax credits allows for a reduction in average and effective marginal tax rates for most individual taxpayers

    So, in short – you make two claims

    • Most Americans think they pay enough in taxes.
    • Ryan only wants to cut taxes on the “rich”

    but the evidence you cite says

    • the tax plan leads to a reduction in the average and effective tax rates for most Americans.

    So I think you mis-analyzed either Ryan’s speech or the tax plan you use as evidence or both.

    My conclusion is based on the evidence above as well as facts implicit in the evidence.

    • most Americans aren’t the “rich”
    • most poor people don’t pay income taxes.

    I can only conclude that, at least in the single tax plan you cite, that the majority of the tax paying americans would pay less taxes.

    And you don’t think that to be a decent enough goal.

    • #6
  7. BD Member
    BD
    @

    Paul Krugman: “I suppose I shouldn’t add to the woes of the Reformocons, the people who wanted to move the GOP forward with new ideas….”

    If Reform Conservatives have Krugman praising them, they must be on the right track.

    • #7
  8. Richard Fulmer Inactive
    Richard Fulmer
    @RichardFulmer

    A growing (the kind of growth that increases employment) economy will reduce the building political pressure for increasing the welfare state and decreasing inequality.   Washington has stymied growth by:

    • Manipulating the nation’s currency.
    • Artificially depressing interest rates and thereby discouraging saving.
    • Penalizing investment with high taxes.
    • Deficit spending and thereby directing scarce resources away from the private sector.
    • “Picking winners and losers” in the marketplace by subsidizing some companies at the expense of others.
    • Bailing out financial institutions and thereby creating moral hazards.
    • Increasing the cost of employment through minimum wage laws, mandated benefits, payroll taxes, licensing laws, and laws that make it difficult to fire workers who don’t produce.
    • Paying able-bodied people not to work.
    • Discouraging investment with regulations that make it difficult to start new businesses.
    • Increasing investment risk with complex laws and regulations whose meaning can be determined only after the fact in a courtroom.
    • Interfering with our schools.

    The best way to turn the economy around is to get the government out of it.

    • #8
  9. Bryan G. Stephens Thatcher
    Bryan G. Stephens
    @BryanGStephens

    Richard Fulmer:A growing (the kind of growth that increases employment) economy will reduce the building political pressure for increasing the welfare state and decreasing inequality. Washington has stymied growth by:

    • Manipulating the nation’s currency.
    • Artificially depressing interest rates and thereby discouraging saving.
    • Penalizing investment with high taxes.
    • Deficit spending and thereby directing scarce resources away from the private sector.
    • “Picking winners and losers” in the marketplace by subsidizing some companies at the expense of others.
    • Bailing out financial institutions and thereby creating moral hazards.
    • Increasing the cost of employment through minimum wage laws, mandated benefits, payroll taxes, licensing laws, and laws that make it difficult to fire workers who don’t produce.
    • Paying able-bodied people not to work.
    • Discouraging investment with regulations that make it difficult to start new businesses.
    • Increasing investment risk with complex laws and regulations whose meaning can be determined only after the fact in a courtroom.
    • Interfering with our schools.

    The best way to turn the economy around is to get the government out of it.

    Yep. Back out of all the regulations, and things will not only take off, but people will be more free. All the sturm-n-dang! will die down.

    • #9
  10. Paul A. Rahe Member
    Paul A. Rahe
    @PaulARahe

    I admire Paul Ryan. But on one issue, he is wrong. Laissez-faire when it comes to open borders means the impoverishment of unskilled or moderately skilled labor. If the supply is infinite, demand will go down, and that which is infinitely supplied will be sold for a pittance. Free trade makes sense from the consumer’s perspective. Open borders mean that the consumers will have very little to spend.

    I despise Trump. But he would not be as effective as he has been were he not telling truths that others refuse to speak.

    • #10
  11. Bryan G. Stephens Thatcher
    Bryan G. Stephens
    @BryanGStephens

    Paul A. Rahe:I admire Paul Ryan. But on one issue, he is wrong. Laissez-faire when it comes to open borders means the impoverishment of unskilled or moderately skilled labor. If the supply is infinite, demand will go down, and that which is infinitely supplied will be sold for a pittance. Free trade makes sense from the consumer’s perspective. Open borders mean that the consumers will have very little to spend.

    I despise Trump. But he would not be as effective as he has been were he not telling truths that others refuse to speak.

    Hits the nail on the head.

    • #11
  12. SEnkey Inactive
    SEnkey
    @SEnkey

    Ryan is on the right track. He is a key player that, as stated above, will be beneficial to conservatives regardless of who takes the presidency or congress the next few years.

    Such a player can be made more useful if other key players are put in place (a real conservative president). With the right ingredients positive change (deregulation) can be accelerated.

    I wish he was more hawkish on borders.

    • #12
  13. SEnkey Inactive
    SEnkey
    @SEnkey

    One other point. Congress is always pushing college. Everyone should go to college. I work at a school, our whole existence is to make kids “college ready.” But, NOT EVERYONE SHOULD OR CAN GO TO COLLEGE. Sorry, not yelling, but everyone needs to understand this. A healthy economy is not one where fifty percent of job applicants have to have a devalued degree to qualify.

    So why the focus? Because most congressmen and everyone in the education bureaucracy has a degree, so of course it’s the right thing for everyone else to do as well.

    • #13
  14. Duane Oyen Member
    Duane Oyen
    @DuaneOyen

    erazoner:“Make peace with the entitlement state.”

    What a pregnant clause. We used to call that “kicking the can down the road.” I guess that’s hackneyed, and the path to insolvency is irreversible, so we may as well not discuss it any longer.

    Rick Santelli, call your office.

    I don’t recall any candidate other than Trump saying that we should not reform entitlements.  The differentiator is whether a candidate pushes for market-reality reforms such as premium support, as both Ryan and Rubio do, or those on our side who want to return to 1934 and pretend that SS does not exist and could somehow be wished away.

    • #14
  15. erazoner Coolidge
    erazoner
    @erazoner

    Duane Oyen: I don’t recall any candidate other than Trump saying that we should not reform entitlements.

    Nor do I (except I’m not too sure about Kasich). The WSJ editorial indicates a growing timidity among conservative pundits about addressing them in hopes of appealing to Trump supporters. I believe that doing so would not only fail to accomplish this, but would jeopardize reform in the long run.

    • #15
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