Are We Caught in the Past?
In early January, the Wall Street Journal ran two thought provoking articles. One by Steve Moore entitled The Weekend Review with Haley Barbour, and the second by Matt Miller entitled Take it from McCain’s Advisers: The GOP Would Raise Taxes.
Both articles are intended to cover steps the GOP either must travel or will have to cover in the future. In the Barbour interview, the points raised were mainly changes in behavior for a political party very much in second place. The GOP finds itself like a loser in the NFL playoffs - you simply go home. What the GOP sorely lacks are idea people. People with convictions. President Ronald Reagan had early on made up his mind about taxes, the economy and dealing with the Soviet Union. Russia, you must remember, was a real threat. They were the enemy who scared children and adults.
My generation learned first-hand how to crouch beneath a grade school desk in case of nuclear attack. Former Speaker Newt Gingrich, too, is an idea man. In case a member of Congress didn’t have an original thought, they simply could sign his “Contract with America.” The document laid out what he intended to do in the first 100 days as Speaker. It was straightforward and transparent. Most politicians and aspiring office holders today seem more interested in holding the job, the perks and power. To them ideas can get one in trouble and certainly no one wants to rock the boat. Two recent examples come to mind. One was in the last Oklahoma State Treasurer’s race when Howard Barnett, who had been a Republican appointee for eight years, spoke about the coming insolvency of the state’s retirement system.
He was right, but where had he been for the past eight years? Why start when you are out of office? This was not a new problem and he knew as Commerce secretary and chief of staff that credit ratings do matter. If officials ignored their obligations, Oklahoma stood to lose its high credit rating. In another example former Education Secretary and Drug Czar Bill Bennett told a Tulsa audience that he hoped President George Bush would pick him for a cabinet position. This time, he felt, he would do a much better job. Why had he not done the job in the first place? There simply are far too many Barnetts and Bennetts out there standing in the way of fresh ideas and better people.
When one looks at Haley Barbour, here is a man who took full advantage of the time granted him. Mississippi and its leaders by all accounts distinguished themselves after Hurricane Katrina. Governor Barbour also has cut taxes and brought thousands of new jobs to a poor state, which lacks Oklahoma’s natural resource wealth. His greatest achievement though was in passing “one of the boldest tort reform laws in the nation.” Barbour is a man with convictions. He needs a wider stage.
Barbour says the first step for the GOP as it tries to right itself is to “come clean and admit we did a lot of things wrong.” “Like what?” He quickly rattles off the misdeeds, “Corruption, out-of-control spending, enormous increases of national debt, no vetoes of spending bills that Ronald Reagan would have hit with a hatchet.” With regard to the nation’s two wars, he adds, “Americans simply don’t like long wars.” The governor worries about the GOP losing the “youth vote, and falling so far behind in money raising. He finishes, “When you’re in power a long time, you become dependent on big money, a few large donors.”
As the article concludes he advices, “Republicans can only win if they rediscover the power and voter appeal of innovations and reform-minded solutions to the nation’s ills.”
Does that mean returning to basics? To the old GOP roots of lower taxes and less government? Absolutely not, according to the second article. In Matt Miller’s essay, he interviews several economic advisors to Senator John McCain. Their opinions conclude that with $50 trillion in unfunded liabilities “and related programs,” that taxes must rise. The consensus is that taxes will rise by between 4-7 percent of GDP over the next 10 to 20 years, translating into $550 billion to $1 trillion more in new annual taxes.”
The author delights, “You heard it here first: The Republicans have a secret plan to raise taxes. So do the Democrats and well beyond the rollback of the Bush tax cuts.” The answer the article surmises, “Will involve lower taxes on payrolls and corporations and higher taxes on dirty energy and consumption. The adjustment will be hardest for the GOP, because the conservative mind is caught in the past.”
Since President Reagan brought taxes down from 70 percent toward 30 percent, any movement upward or downward to the lower figure would seem quite small. So why are taxes still a big issue? “It’s the brand and you don’t dilute the brand,” say the GOP experts. The article concludes, “The over-reaching challenge for Republicans in its aftermath will be to craft a new political identity that doesn’t rely on a dead idea.”
The conclusions of the Miller article are wrong. With the economic problems facing the nation raising taxes is not the answer. Americans are worried. They have been misled, lost 40 percent of their retirement savings and may lose their jobs. Any consumption tax limiting ones ability to purchase clothes, automobiles, homes and food will only depress the economy further. If you drive an older car and lost your job, taxing your “dirty energy” automobile is in whose best interest?
The good path for the GOP can be found in the Business Week article naming the twelve best managers and outlining their management styles. Mr. Van Der Veer of Royal Dutch Shell says “The task of leaders is to simplify. You should be able to explain where you have to go in two minutes.”
Sadly, the Bush era Republican officeholder can’t explain or much less act on what they want to do other than hold office. “Squeezing costs and improving efficiency while delivering innovation” is stressed by Hewlett-Packard’s CEO, Mark Hurd. None of the 12 CEO’s advocates throwing money at a problem.
If twelve men and women can turn around major companies, the GOP following their advice can right itself. The ideas of the past have the same relevance in the 21st Century as they always have.