"Conservative Intellectuals Fear the GOP Is Out of Ideas"

[applegrove]

Conservative Intellectuals Fear the GOP Is Out of Ideas

By Peter Coy at Business Week

http://www.businessweek.com/articles/2014-03-12/conservative-intellectuals-fear-the-gop-is-out-of-ideas#r=pol-ls

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Since they weren’t running for office, the panelists could afford to say things you won’t hear from Republicans on Capitol Hill. Roy said that the Democratic Party “has a more legitimate claim of being a national party” in terms of its regional and ethnic diversity. Salam said “our mental model of capitalism is wrong.” Levin said “capitalism requires a kind of citizen that it doesn’t produce.” McArdle said that the GOP formula that worked well in the past—deregulation and tax-cutting—doesn’t answer today’s problems. Barro topped her, noting that judging from today’s low interest rates, the bond market is much calmer about federal budget deficits than Republicans are. “A conservative is somebody who thinks every market is efficient except the Treasury bond market,” he said.

The Romney campaign in 2012 deliberately avoided an ideas-based campaign, fearing that any specifics could end up being used against the Republicans at the polls, Levin said. “That just has to change,” he added. On the same note, Roy said the Republicans need a conservative version of President Lyndon Johnson, who modernized the Democratic Party in the 1960s through sheer force of will, overcoming the opposition of old-fashioned Southern Democrats to make Democrats the party of civil rights.

As for new ideas, McArdle—disclosure: a distant Bloomberg colleague—pushed a favorite of hers: payroll tax rebates for the long-term unemployed. The idea is to make them cheaper for employers to hire, increasing their chances of getting a job. Barro questioned whether the tax rebate would just end up in employers’ pockets by bringing more people into the labor market and driving wages down. McArdle responded that it would work if it was clearly targeted at just the long-term unemployed.

In any case, payroll tax rebates aren’t likely to pass muster with conservatives who oppose all spending hikes, since the hit to the Social Security and Medicare trust funds from cutting the payroll tax would have to be made up with general revenues.


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