The Magazine

A Theme for McCain's Pudding

Here's how to tie together the campaign's assortment of ideas: a reform agenda for the 21st century.

May 26, 2008, Vol. 13, No. 35 • By YUVAL LEVIN
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In recent weeks, while the penultimate chapter of the Democratic nomination race has monopolized our attention, John McCain has engaged in a series of auditions of general election themes for his campaign. In early April, he set out on a "Service to America Tour," highlighting key points of his biography. Two weeks later, he launched his "Time for Action Tour," which focused on some of the country's most economically depressed regions, and which should by no means be confused with the "Call to Action Tour" that followed and focused on McCain's health care plans. Then last week in Ohio, McCain outlined key elements of his agenda in a speech organized around a description of America in 2013--after his first term. Speaking of the future in the past tense, he sought to describe himself as an ambitious doer.

All of these allowed McCain to raise important issues and to offer some interesting ideas. The health care tour, in particular, yielded a speech (delivered in Tampa, Florida, on April 29) that is to date the best articulation of the conservative vision of health care from a Republican politician. What has not emerged is a coherent campaign narrative: a theme that unites McCain's proposals, his persona, his assessment of the state of the nation today, and the essence of what he plans to offer the voter in November. Indeed, this absence of an organizing principle was painfully evident in his "America in 2013" speech, which was the very model of a themeless pudding.

The titles and the presentation of these assorted events suggest the McCain campaign is looking to ground its messages in duty, honor, and ability, presenting the candidate as a man who has always been ready to step up and act when his country needed him. This was roughly the approach of the Dole campaign in 1996 and (in a rather different way) of the Kerry campaign in 2004, and in both cases it failed to capture the imagination of the electorate. Campaigns need to sell their candidate, to be sure, but successful campaigns usually do so by articulating a candidate's vision of the present moment and the future, and not just his willingness to answer a call. The McCain campaign is currently organized around the candidate's character and persona, and the question is to what governing philosophy McCain's "honor politics" points.

It is of course fairly late in the game to be engaged in basic message development, but McCain's peculiar path to victory in the primaries did not force him to do so earlier. He won, after all, without a base, without much of a strategy, and without an organized campaign apparatus. His various rivals eliminated one another (or, in the case of Giuliani and Thompson, eliminated themselves), and McCain was the man left standing in the end. His defining issue was the war in Iraq, which seems increasingly unlikely to be the issue that defines the general election. The McCain team is therefore in the unusual position of having won the primaries without a clear unifying theme for its candidate's message. The challenge is not to invent a campaign theme from scratch, but to discern and articulate the organizing principle of the candidate's outlook on politics.

McCain himself long ago offered the core of the answer. In announcing his first run for the presidency, in September 1999, McCain declared that if elected he would work to "reform our public institutions to meet the demands of a new day." So far he has not made the vocabulary of reform a key to his second run for the White House. But a comprehensive reform agenda, which framed America's challenge in terms of revitalizing and reimagining its core public institutions, would be a natural fit for McCain, and for the challenges of the day. It would provide him with the overarching theme for the assorted elements of his approach to public policy.

CHANGE AND REFORM

A successful McCain campaign would begin with noting what is wrong with the Democrats' main theme: change. In an election year marked by a vague but pervasive sense of anxiety among voters, there is something ironic about the Democratic mantra. Change, after all, is exactly what Americans have been experiencing over the last several decades: changes in the American and the global economy; changes in social and family structure; changes and advances in the technologies of medicine, communication, transportation, and information processing; changes in just about every facet of our lives. Many have been welcome, but all have brought with them unease, especially as they have outpaced the ability of our large public institutions to adapt. Lurking beneath the individual concerns and anxieties that voters express to pollsters is a broad crisis of confidence, grounded in apprehension about the escalating failures of these institutions, from the intelligence community and giant Wall Street banks, to entitlement programs, the immigration system, and beyond.

Many of our public institutions arose to meet the demands of the 20th century. The growth of complex financial markets brought about the Federal Reserve and an evolving regime of financial regulation. The emergence of powerful new technologies brought about agencies, like the Food and Drug Administration and the Federal Aviation Administration, to ensure their safe use. The expenses of longer and healthier lives led to entitlement programs like Social Security and Medicare and to a complicated system of employer-based health insurance. The demands of two world wars and a long cold war brought about an integrated American military and a slew of intelligence agencies. And the challenges of managing and regulating all of this led to vast new institutions of governance: from the career federal bureaucracy and the absurdly complex tax code to the modern federal budget process.

These institutions have always had critics, but in recent years the old debates have begun to seem outdated as the circumstances from which they emerged have changed dramatically and the institutions begun to show signs of serious decay. Grave institutional failures have been behind some of the prominent problems of the Bush years. The systemic sclerosis of the intelligence community led American leaders to underestimate al Qaeda's ambitions and to overestimate Iraq's weapons programs. A disorganized domestic response apparatus revealed itself after September 11 and again in the wake of Hurricane Katrina. An overly rigid military (particularly the Army) designed for the Cold War found it difficult to adapt after early setbacks in Iraq and has even resisted a new and winning strategy more recently.

A health care financing system built for the mid-20th-century American economy has been showing strain for decades--just about everyone now agrees it needs a serious redesign. Old-age entitlements designed for a very different population are threatening to go bankrupt and take the federal government right with them. A legal immigration system enacted four decades ago is far out of touch with contemporary needs, while illegal immigration proceeds at a staggering pace.

Regulatory institutions have not fared better, and in just the past several months, we have seen embarrassing breakdowns at the FAA, signs of severe overextension at the FDA, failures of basic oversight in the nation's financial regulatory system, and new causes to worry about the readiness of the Federal Reserve to contend with unexpected events. Similar signs of trouble are everywhere. Individually, each of these may be dismissed as a modest problem, of the sort that is always popping up somewhere. But seen together, as they are arriving together, these signs point to a decay that may be the governing problem of the moment.

BIPARTISAN BLINDNESS

The left and the right have both largely failed to notice this emerging pattern. For the left, it has been easy these eight years to blame every failure of governance on a failure of execution and to assume that the man in charge of the executive branch is the key to all our troubles. To the extent that they now propose institutional reform--and it is a surprisingly limited extent--leading Democrats have in mind giving government more power and more responsibility: in health care, over the financial markets, in the housing sector. But that is less a response to the emerging decay of our public institutions than an expression of the left's generic approach to great governing problems.

Senators Obama and Clinton, moreover, have almost nothing to say about many of the most prominent institutional crises we face, including immigration, the structure of the military and the intelligence community, and (perhaps most amazingly) entitlements and the looming crisis of our welfare state institutions. Indeed, both have offered health care plans that would import into the private health care market the logic of a Medicare system now facing an $86 trillion unfunded liability.

Republicans, meanwhile, having never been quite at home with the original purposes and ends of some of these institutions, aren't thinking constructively about reforming them (though there are a few exceptions, most notably Newt Gingrich). There has, of course, been debate about the structure of the military and immigration, and Republicans are increasingly thinking creatively about health care as well. But the conservative response to the Bush administration's Medicare prescription drug plan, for instance--a plan that for the first time introduced market incentives into Medicare and quickly proved the power of incentives to reduce costs and improve quality--shows that the right is still fighting the last war and failing to recognize an opportunity to roll back the most egregious elements of the welfare state, by planting conservative principles deep in enemy territory. Conservatives have a chance to fundamentally alter some of the assumptions behind our large public agencies of regulation, governance, and welfare.

CONSERVATIVE REFORM

The right is well suited to the task of such reform. The overarching lesson of our failing institutions is not that government has failed to reach far enough into American society, but that life in the 21st century is more complex and less predictable than our 20th-century institutions can readily fathom. The answer is not to expand government so it can rescue people from themselves--which is the underlying premise behind just about every plank of Hillary Clinton's and Barack Obama's platforms--but to make the institutions dynamic and flexible enough to advance the causes of economic growth, cultural vitality, and national security.

"A disposition to preserve and an ability to improve" was Edmund Burke's definition of the statesman two centuries ago, and it remains the hallmark of conservatism. While American conservatives have sometimes liked to think of themselves as revolutionaries (or radical counter-revolutionaries), the most significant accomplishments of the conservative movement have actually been targeted reforms that turned existing institutions to conservative ends. The Reagan "revolution" gave us a tax code better suited to entrepreneurship and growth. The Gingrich "revolution" gave us a welfare system with incentives geared toward encouraging independence and initiative. Conservative reform of urban law enforcement, and early efforts at reform of local education (through school choice), have improved what we have, rather than rejecting it. Reform, not revolution, is the conservative path to supporting strong families and free markets.

A reform agenda would be especially well suited to John McCain, as he himself seemed to see in 1999. McCain's conservatism is not fundamentally ideological. He is not especially interested in political "issues" or in abstract ideas about individual rights or the role of government. Rather, he is moved by large challenges and great exertions, and by the imperative of meeting America's commitments. He is a conservative because he believes the right has a more responsible attitude toward meeting these commitments, and is more likely to keep Americans (as individuals and as a nation) strong enough to do great things.

This makes for an awkward marriage between McCain and the conservative movement, but it is a coupling with more opportunities for joint efforts than the two sides realize. Rather than pretend McCain is a traditional movement conservative or that conservatism is a nonideological honor code, the two should seize an opportunity to work together for their rather different ends, with McCain giving voice to the aims and the urgency of reforms, and conservatives offering him the means. They should seek to reform our governing institutions in ways that would turn them to the cause of America's working families (which are the source of America's strengths), and should understand that cause in terms of upwardly mobile aspiration, not bitter and angry desperation.

McCain should paint a picture for the public of the moment we are in: confronted on the one hand with a justified crisis of confidence in our institutions and on the other with proposals from the Democrats driven by a set of liberal ideological commitments that would exacerbate the problem by carelessly expanding government. The cure for what ails us is not change that is simply more of the same--more bureaucracy, a further takeover of the private and domestic spheres that in the name of offering relief steals away more and more of our independence and initiative. The cure, rather, is to plant in the architecture of our largest public institutions the conservative commitments to individual freedom and initiative, to the centrality of parenthood and the family, and to the cause of American strength in the world.

A REFORM AGENDA

A McCain reform agenda would begin with an effort to help give American families more say over the institutions they rely on most directly.

America's health care system is a product of 20th-century labor policies, and it is struggling to keep up with 21st-century medicine. It puts too many incentives in the wrong places and creates needless uncertainties and tensions. The care is not itself a problem: It is for the most part advanced, high quality medicine, and those with access to it are very happy with it. The problem is that access to insurance coverage is a function of a tax policy grounded in World War II-era employment laws. Many Americans in our modern economy no longer fit the model--not because they are oppressed or put upon, but because they are pursuing prosperity in different ways. Small business employees, the self-employed, freelancers, and those who change jobs frequently find themselves at constant risk of losing health coverage.

The answer is not a program of government subsidies that slowly drives consumers into public insurance--which is what Senators Clinton and Obama propose--and which would create an even less responsive system than the one we now have. (This would replace a slowly decaying 20th-century model with an essentially bankrupt 20th-century model.) The answer is, rather, to treat individuals as individuals, create incentives for cost containment in the private sector, and help the uninsured find private coverage.

To his credit, McCain has already put forward a plan along these lines, which begins gently to separate insurance from employment and to introduce market incentives to contain costs--but he needs to make a concerted effort to explain it and show why it is preferable to the Democrats' approach. The failure of American health coverage is the preeminent domestic concern in this election year, and conservative health care reform is the key to McCain's reform agenda.

Tort reform is another natural issue for McCain, as a companion cause to his health care reform. The existing medical liability regime pits trial lawyers--an unpopular Democratic interest group--against doctors and nurses, and it increases the cost of health care for all. Conservatives have long advocated some modest but meaningful reforms of medical liability, and McCain would be wise to draw on those ideas and make the issue a prominent cause in the coming months.

Democratic politicians have chosen to deny the looming crisis in Social Security and to blithely ignore the even larger and more complicated disaster facing Medicare. McCain has argued for comprehensive Social Security reform in the past and should do so again with renewed vigor. Here again, Republicans have an answer at the ready: a plan for personal accounts for future recipients that leaves those age 55 and over untouched. It is a vital reform in desperate need of a champion to make its case.

Medicare, unfortunately, is a much bigger problem. But the design of the prescription drug benefit passed in 2003 offers a model. As James Capretta has argued, Medicare should be gradually transformed from an open-ended entitlement into a defined-contribution program, which provides individuals with a preset amount (based on average insurance costs in their area) toward the purchase of private or public insurance. Individuals would choose what specific plan to purchase, so plans would compete for their business. Such an approach would not only begin to reverse Medicare's disastrous fiscal course, it would also help contain costs in the larger health care sector (since Medicare's open-ended reimbursement is responsible for a significant portion of health care cost inflation). No politician has had the courage to address Medicare's fiscal troubles. McCain could do so as part of a broader appeal for reform and insist that to ignore the problem is a disgraceful dereliction of responsibility to the future.

McCain also can become a more forceful booster for school choice. The failure of many urban schools, and the underperformance in many rural and suburban schools, is a function of a deeply sclerotic and counterproductive bureaucracy, working in tandem with a powerful union (another Democratic constituency) that resists any hint at reform. Directing his attention to urban schools that underprivilege students who are seriously underprivileged to begin with, McCain should make a case for targeted choice programs, which have worked in a few fortunate cities in the past decade. He can make it clear to middle-class parents that their children's schools need not change if they are working, but that other children desperately need to be given a chance to escape from failing schools.

Tax reform is also a way of supporting lower- and middle-class families while encouraging economic growth. McCain should seek not only to remove unneeded burdens on businesses--as he has already declared his desire to do--but also (and especially) to remove unfair burdens on parents. A major expansion of the child tax credit, applied against payroll as well as income taxes--as proposed by Ramesh Ponnuru and Robert Stein--would be the ideal centerpiece of a McCain tax reform. McCain has made gestures in this direction, but should make this a prominent proposal. It would clearly signal that his agenda is aimed at middle- and lower-class families. And McCain's entire reform platform should be directed to the stresses and concerns of these families.

The housing and credit crisis afflicting the American economy also provides an opportunity to take a fresh look at key elements of the government's role in regulating credit markets and corporate governance. McCain is well suited to take on Wall Street's excesses without attacking its core strengths. The key is not more regulation, but smarter and leaner regulation, which removes unnecessary burdens from businesses but protects America's large new investor class--which did not exist when many of our regulatory institutions were born. It is also time to consider fundamental reforms of the federal reserve system.

FIXING GOVERNMENT

As he addresses the institutions that touch the lives of American families, McCain should propose a reform of the federal government itself. He might begin with comprehensive budget reform, promising to work with Congress to redesign the annual federal budget process, with its 11 separate fiefdoms, its inability to produce an orderly budget on time, and its endless opportunities for mischief, waste, and fraud.

McCain could also call for a thorough reappraisal of federal regulatory agencies, beginning with the Food and Drug Administration. The FDA is over a century old and has not been able to keep up with dramatic changes in both technology and the world economy, particularly the globalization of the supply chains for food and medicine. The contamination of pet food resulting from improper practices by a Chinese supplier last year was a loud and clear warning: A similar (and far more terrifying) disaster in the human food supply is easily imaginable under today's regulatory regime. The FDA needs more than new resources; it needs a top-down redesign. Other safety and regulatory agencies, like the FAA, have also shown serious strain in the last few years and require a rethinking.

The failure of America's immigration system, meanwhile, is a problem McCain knows all too well. Rather than raise again the prospect of legal status for illegal aliens, however, McCain might focus on two more urgent priorities: control of the southern border and reform of the legal immigration system. America's immigration laws were written in the mid-1960s and only barely revised since. The system they created is too heavy on family-based immigration and too light on sensible labor-based immigration. It is also almost entirely lacking in any formal elements of assimilation and integration. It needs to be thoroughly redesigned to combine secure borders with open arms and economic benefit with common sense.

Perhaps most important, McCain should propose a comprehensive national security reform agenda. He is well-versed in the need to restructure American diplomacy and to reform the military, the intelligence community, and our homeland security agencies. He has already begun to talk about some reforms of America's foreign policy apparatus (particularly public diplomacy), and even about some reforms to global institutions, seeking to replace the mid-20th-century United Nations with a 21st-century league of democracies. The last few years have offered no shortage of lessons for reforming the organization of the Armed Forces and revisiting the joint command structure, which is showing real strain. The intelligence community, meanwhile, is showing not strain but signs of systemic failure. The Bush administration began some efforts at reform through the creation of a director of national intelligence, but vigorous work is sorely needed. In pursuing both military and intelligence reform, moreover, McCain has a particularly rich storehouse of conservative reform ideas to call upon.

There is also a powerful cautionary lesson to draw on. The Department of Homeland Security is the first prominent example we have of a major 21st-century reform, and it is mostly a negative example. It demonstrates that reform must consist of more than moving existing boxes around on an organizational chart and creating vast new structures to house largely unreformed old institutions. Institutional reform is not only about efficiency; it must also be directed to a reappraisal of ends and a careful honing of means.

A CAMPAIGN FOR REFORM

These are, to be sure, mere chapter headings for a campaign agenda. But in many of these areas the McCain campaign has already offered proposals, which it now could tie together under a common narrative. That narrative ought to revolve around the challenges that call for reform, and the need for reforms that build on America's strengths, rather than exacerbating its troubles. Such an approach would suit McCain. He could show his grasp of the challenges we face and his confidence in America's future. He could drive home the point that what we need is not more government but a government better suited to the times and to the concerns of the American family.

Obviously such an immense reform agenda could not be accomplished by any single president, and particularly not in the exceedingly difficult political circumstances McCain would likely face if he won in November. But by advancing an ambitious agenda--one that if anything is too heavy on specifics--McCain could provide a sensible and coherent explanation for the generalized anxiety of the American public today and a road map toward addressing it head on.

McCain would also be providing conservatives with a new way of thinking about the challenges they confront as a governing party rather than a counterrevolutionary one and a new vocabulary for making the case for limited-but-effective government, for freedom and individual responsibility, and for American values. Precisely such reforms have been among the greatest gifts the conservative movement has given America. A renewed program of energetic conservative reform would bear similar benefits in years to come.

Yuval Levin is the Hertog fellow at the Ethics and Public Policy Center and senior editor at the New Atlantis magazine.