Imagine the horror of finding myself favorably cited by David Frum, who notes my concern with lack of attention to elections by the conservative blogosphere, and says that conservatives aren’t neglecting politics so much as they’re neglecting policy:
What is neglected is governance. How much do we discuss what went wrong with the US economy in the Bush years? If tax cuts are essential to pulling the economy out of recession, why didn’t Bush-enacted tax cuts prevent the US economy from tumbling into recession in the first place? Why did incomes stagnate between 2000 and 2007? Why did health cost inflation suddenly accelerate after 2001? What went wrong in the energy markets? How can we do better next time?
Where to begin addressing Frum’s questions? I would start by quoting an observation Ronald Reagan made about liberals in 1964:
They say the world has become too complex for simple answers. They are wrong. There are no easy answers, but there are simple answers. We must have the courage to do what we know is morally right.
In terms of economic policy, the Bush administration was necessarily guilty of doing that which was politically feasible, rather than doing what was right. Bush also became a prisoner of his own rhetoric — a “compassionate conservative” who was a “uniter not a divider” and who aimed to establish “a new tone in Washington.” This stance limited Bush’s ability to do what was really needed: Reduce the economic footprint of the Welfare State and, especially, curtail the entitlement programs that threaten to bankrupt our nation.
Consider the most glaring failure of the Bush era, the housing bubble. Over the past several decades, the federal government has become so deeply involved in housing — Fannie and Freddie, HUD, the Community Reinvestment Act, the mortgage-interest income tax deduction, etc. — that genuine free-market price signals have become hopelessly obscured by the effects of government intervention. And I am reminded of something that P.J. O’Rourke said two decades ago about public housing policy and rent control:
The law of supply and demand tells us that when the price of something is artificially set below market level there will soon be none of that thing left — as you may have noticed the last time you tried to buy something for nothing.
The flip side of this aphorism (which we may call O’Rourke’s Law) is that when the federal government subsidizes something — as it has subsidized home ownership — the price will be artificially set above market level so that people will be paying more than they can afford for something that is worth a lot less than they paid.
What is true of housing subsidies is also true of health-care subsidies. When the federal government made employer-provided health insurance exempt from income taxes, and subsidized health care in other ways large and small, the inflation of health-care costs was an inevitable result. In an attempt to get a handle on this problem, companies responded by turning to the much-hated HMOs, as well as enacting policies (including out-sourcing and hiring lots of part-time workers) that limited their health-insurance obligations. In many states, policy-makers responded by seeking to impose various mandates on employers and/or insurance companies, having the effect of forcing the private sector to provide health care, regardless of the costs and . . .
Well, these various problems were recently “solved” by the enactment ObamaCare, a solid-gold policy nightmare. It is predictable, as night follows day, that this new policy will not only fail to remedy most of the problems it aimed to address, but also — because of the Law of Unintended Consequences — that it will cause new problems its proponents failed to anticipate. It is just as predictable that any conservative proposal to amend ObamaCare (never mind repealing it, as we ought to do on Day One of any future GOP Restoration) will be denounced as heartless cruelty to the program’s tens of millions of beneficiaries.
You see here, then, that the failure of Bushism was in its unwillingness to speak with Reaganesque clarity about the simple answers — not easy, but simple — to complex problems: Get the federal government out of the housing business and out of the health-care business and (while we’re at it) out of the education business.
Professor Glenn Reynolds has recently discussed the “higher education bubble” as a looming disaster and, as with so much else in contemporary America, this is a problem largely caused by federal meddling. Who is it, after all, that encouraged the Courtney Munna to borrow nearly $100,000 to get a degree in Religious and Women’s Studies? If Fannie Mae and Freddie Mac were implicated in the housing bubble, who will exempt Sallie Mae from blame for the higher education bubble?
We cannot solve problems that we are unwilling to identify as problems, and the intrusion of the federal government into nearly every aspect of our lives — which is to say, the modern liberal Welfare State — cannot be remedied by pretending that all it needs is a few policy tweaks.
Excuse me if I suspect David Frum of believing that a better set of policies, enacted by a better set of policy-makers, can make the Welfare State monstrosity workable. The answer to the Welfare State is not to put Republicans in charge of running it, but rather to push relentlessly for its reduction, to point out at every opportunity how this overgrown bureaucratic catastrophe is destroying our freedoms, picking our pockets, corrupting our politics, and — the most cruel irony — endangering the American dream for those “little people” whom these misguided policies were allegedly intended to help.
That may not be an easy answer, but it is indeed simple.
Good policy is good politics, and vice-versa. To speak the truth, and act upon it, will require moral courage, as Reagan said. The failure of the Welfare State is a truth so obvious that only a fool could fail to recognize it, and only a coward would refuse to join the fight to remedy that failure, thereby restoring both our freedom and our prosperity.
Who will have the vision to lead this fight?
