The Magazine

Grand Old Opportunity

Apr 1, 2013, Vol. 18, No. 28 • By YUVAL LEVIN
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The government can’t solve all this, but there is much it can do because a lot of the problem is caused by bad public policy. The sectors of the private economy most dominated by government—education and health care—are burdened by outdated institutions and irrational economic arrangements. Modernizing both (by breaking union monopolies, deflating the higher-education bubble, and using competition to drive higher-value health care and reduce entitlement costs) would help train tomorrow’s workers and avoid crushing them with both public and private debt, and it would help save the safety net for the vulnerable from fiscal collapse. Meanwhile, the sector with the most potential for fueling a near-term boom—energy—is being held back by an administration uncomfortable with newly discovered domestic fossil-fuel reserves.

Reforms in other key areas are also badly needed. A simpler, leaner tax code would reduce the government’s drag on the economy and could allow us to focus tax relief on lower-middle-class families struggling under the payroll tax. Monetary policy focused on steady nominal growth could power a real recovery. And reinforcing the work of civil-society institutions to strengthen families and communities could help restrain the disastrous social trends that undermine mobility and hold back the poor.

The political and economic appeal of lower health care, education, energy, and tax bills should be obvious, and the moral force of saving the safety net and combating the collapse of poor families and communities is plain. Yet amazingly, neither party has seriously offered such an agenda.

The Democrats have an excuse: Their electoral coalition makes it impossible for them to offer that agenda. Progressives are committed to every jot and tittle of today’s broken welfare state, environmentalists are allergic to oil and gas, teachers’ unions oppose meaningful K-12 reform, the professors would never put up with a new business model for higher education, public employees will resist every effort to modernize government services, and cultural liberals see a moral awakening as a recipe for repression. Far from owning the future, Democrats are helplessly stuck in the past. There is a reason why the president ran on no agenda and why Democrats now offer only blind reaction.

Republicans have no such excuse except inertia. In fact, a growth agenda geared to reviving upward mobility and offering relief to middle-class families would be a perfect marriage of conservative principles and Republican political objectives. It would powerfully appeal to demographic categories the Democrats imagine they own while uniting core Republican constituencies and exposing progressivism for the spent force it is.

The substantive policy agenda for such a modernized conservatism largely exists in the world of right-leaning wonks, but the politicians have been slow to embrace it. It is high time they did, not only for their party’s sake but for their country’s.

The reactionary left has little to offer the future except debt and decline. Its exhaustion threatens to become the country’s exhaustion. Only an assertive, imaginative, and entrepreneurial policy conservatism geared to applying longstanding principles to new challenges can open another path. And only that kind of path, rather than an attempt to emulate the Democrats’ supposed electoral formula, could make possible the Republican renewal that is now essential to America’s renewal.

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