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The New Face of Neoliberalism?

What Paul Ryan's Roadmap does.

1:54 PM, May 14, 2010 • By MATTHEW CONTINETTI
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I read Charles Peters's "A Neoliberal's Manifesto" today and came away thinking the founder of the Washington Monthly really ought to meet Rep. Paul Ryan of Wisconsin. The manifesto was published in May 1983. Here is Peters on means-testing:

Another way the practical and the idealistic merge in neoliberal thinking is in our attitude toward income maintenance programs like Social Security, welfare, veterans' programs, and unemployment compensation. We want to eliminate duplication and apply a means test to these programs. They would all become one insurance program against need.

As a practical matter, the country can't afford to spend money on people who don't need it -- my aunt who uses her Social Security check to go to Europe or your brother-in-law who uses his unemployment compensation to finance a trip to Florida. And as liberal idealists, we don't think the well-off should be getting money from these programs anyway--every cent we can afford should go to helping those really in need.

This isn't much different from the spirit of Ryan's Roadmap for America's Future. There is the myth, widely propagated by the media, that Ryan's plan takes a shredder to the welfare state. Exhibit A is David Leonhardt, who wrote this week that the Roadmap would "end Medicare for anyone under 55 years old." Not true. Whatever its faults, the Roadmap preserves the current system for those over 55, and restructures the program so that the under-55s who need Medicare will be able to enjoy benefits that otherwise won't be there. What the Roadmap tries to do, simply put, is make the welfare state work for the poor. Neoliberalism attempted something similar.

I say "attempted" because the neoliberal tendency is pretty much extinguished these days. Most of the writers and economists Peters says are neoliberal in his manifesto have moved left. The only remaining neoliberal, in my opinion, is Mickey Kaus, who continues to question conventional wisdom and highlight the destructive power of unionism. For a lot of liberals, the financial crisis in particular discredited business and the market. Obama put the gloss back on paleoliberalism. The Bush years and the Iraq war led the Democrats to fall for Peters's first principle of paleoliberalism, Don't Say Anything Bad About the Good Guy:

The feeling here seemed to be that any criticism of institutions [liberals] liked -- the public schools, the civil service, and the unions are good examples -- was only likely to strengthen the hand of their enemies. A corollary was Don't Say Anything Good About the Bad Guys, meaning the police, the military, businessmen (unless small), and religious leaders (unless black or activist). 

Of course, Paul Ryan would reject the "neoliberal" label -- as he should. His instincts are libertarian. He's a social conservative. He's a Republican in the Kemp-Gingrich "opportunity society" mode. But it's nonetheless interesting that he, among others on the right, is rethinking the welfare state in ways free-thinking Democrats once did. Put another way, the Democratic party's failure might end in neoliberalism's triumph. And wouldn't that be ironic.

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