WHAT WE NEED IS A GOLDILOCKS GOVERNMENT
As President elect Barack Obama seeks to expand the size of government to previously unheard of proportions, conservatives find themselves in a very difficult position politically. The fact is, there is no way, in principle, conservatives can compete with Obama when offering government help to anyone and everyone with their hand out. To do so would be to betray basic princples of the conservative movement.
But the political problem faced by conservatives is that they are in a position only to say “no” to the Bush/ Obama bailouts - playing Grinch to the next president’s Santa Claus. The question of a conservative alternative to this madness - except to allow the market to do its dirty work and pick and choose which businesses deserve to live or die - has rarely been raised, largely because the cure involves more economic pain than Obama is promising.
The “solution” that applies the principles of big government liberalism is unacceptable because, at bottom, it alters the social contract between the people and their government, substituting dependency for freedom (not to mention utterly failing when tried previously during the Great Depression). The other way - also tried during the depression - is to allow the market to function as executioner while perhaps taking most of the rest of down a path to economic ruin that we would be a decade or more recovering from.
The fact is, conservatives have no viable response to the Obama bailout program. On the one hand, the next president offers to save jobs, save companies, and prime the non-existent Keynesian pump with hundreds of billions in federal dollars that will - he says - put people back to work. On the other hand, conservatives are telling the American worker that he will have to take a hit due to the incompetence and short sightedness of his managers and be patient while the market sorts out the winners and losers.
One kind of government is too big. The other kind is too small. Clearly, what we need is a government that is “just right” - or at least an expression of “limited” government where conservative principles are married with the needs of a 21st century society.
“Too big to fail” is being overused in this crisis. But there are other ways to avoid failure than simply handing out unthinkably large sums of money to managers who have performed incompetently and whose actions caused the crisis in the first place and where such handouts presuppose that government can then dictate how that company or industry does business.
What about intelligently structured bankruptcy, government facilitated mergers with healthier companies, and even in special cases, guaranteed loans where the chances of the taxpayer being burned is very low? The point being, when one way being pushed involves big government solutions and the other way offers a small government conservative alternative that doesn’t address the real needs of real people, what is needed on the part of conservatives is a little imagination where proposed solutions will keep many if not most employees working, save important companies, and address the worries of the American people (a side benefit of which could be a boost in consumer confidence that might get money circulating a litte more freely). Most importantly, there must be ways for government to assist business in this crisis without ending up having what amounts to ownership rights that would for all practical purposes nationalize entire industries.
The Wall Street Journal laid out some alternatives to the auto bailout plan while showing how the Democrat’s plan would basically nationalize the Big Three by forcing them to accept the government’s own business plan:
Yet amid all the hopeful talk about the brave, new green car world, the men from Detroit were studiously silent on whether they can sell these new cars at a profit any better than they can their current lineup. Yes, the restructuring plans, especially GM’s, have some stark numbers about downsizing — 30,000 blue collar jobs are on the chopping block at GM alone. And this is accompanied by gauzy predictions of matching Toyota’s labor costs by 2012. But it’s hard to see how that gets done without a bankruptcy judge to tear up the contracts and start over. Once the auto makers agree to let Barney Frank run their businesses, does anyone really believe organized labor will roll over and let them gut the United Auto Workers?
The core problem is that the companies can’t pay their creditors in fuel-economy standards. Two economists testified that the ultimate cost of this bailout would certainly be much, much higher than $34 billion. Mark Zandi of economy.com put the number at up to $125 billion — and he supports the bailout. NYU’s Edward Altman said the company proposals were “doomed to fail.” He proposed a prepackaged bankruptcy for GM and Chrysler, with the government providing the debtor-in-possession financing if necessary. His point, which ought to be sobering, was that outside of bankruptcy there is no way to make these taxpayer loans senior to existing secured debt — meaning the government might never get paid back if the companies go bankrupt later.
Mr. Altman’s suggestion has a lot of things going for it. Instead of the politically driven “car czar” being mooted to oversee the bailout, you’d have a bankruptcy judge to make sure that the companies did, in fact, emerge as more viable businesses. The resulting restructuring would be far more likely to be driven by business considerations
What we’re talking about here is not “small” government but “limited government” - the idea that government can go this far and no farther consistent with Constitutional principles and conservative ideals. But we’ve been so busy railing against “big government” that other ways and means of dealing with this crisis have escaped our notice. In the process, we have become irrelvant in this, the most important debate in more than a generation that, at bottom, is one that deals with the size and scope of federal power and whether and how much it should be expanded at the expense of the states, private industry, and individual citizens.
In truth, Obama and the left don’t want to have this debate. That’s because they wish to use this economic crisis to remake American society - from the top down:
The thing about a crisis — and crisis doesn’t seem too strong a word for the economic mess right now — is that it creates a sense of urgency. Actions that once appeared optional suddenly seem essential. Moves that might have been made at a leisurely pace are desired instantly.
Therein lies the opportunity for President-elect Barack Obama. His plans for an activist government agenda are in many ways being given a boost by this crisis atmosphere and the nearly universal call for the government to do something fast to stimulate the economy.
This opportunity isn’t lost on the new president and his team. “You never want a serious crisis to go to waste,” Rahm Emanuel, Mr. Obama’s new chief of staff, told a Wall Street Journal conference of top corporate chief executives this week.
He elaborated: “Things that we had postponed for too long, that were long-term, are now immediate and must be dealt with. This crisis provides the opportunity for us to do things that you could not do before.”
He ticked off some areas where he thought new doors were opening: energy, health, education, tax policy, regulatory reforms. The current atmosphere, he added, even makes bipartisanship easier: “The good news, I suppose, if you want to see a silver lining, is that the problems are big enough that they lend themselves to ideas from both parties for the solution.”
Note that Emanuel sees the GOP rolling over and playing ball with this radical restructuring of American society because conservative alternatives are not being pushed by the party leadership. Any “ideas” advanced by Republicans will involve fiddling with Democratic legislation at the margins, not offering viable, limited government alternatives.
William Kristol correctly identifies the problem but offers the wrong solution:
Now it’s true that the size of the government and the modern liberal agenda are connected. It’s also true that modern conservatism has to include a strong commitment to limited (though energetic) government and to constitutional (though not necessarily small or weak) government. Still, there’s a difference between a conservatism that is concerned with limited and constitutional government and one that focuses on simply opposing big government.
So: If you’re a small-government conservative, you’ll tend to oppose the bailouts, period. If you more or less accept big government, you’ll be open to the government’s stepping in to save the financial system, or the auto industry. But you’ll tend to favor those policies — universal tax cuts, offering everyone a chance to refinance his mortgage, relieving auto makers of burdensome regulations — that, consistent with conservative principles, don’t reward irresponsible behavior and don’t politicize markets.
The solution, as Scott Johnson eloquently points out, is not “big government conservatism” but “limited government” bounded by the Constitution:
Yet a debate framed in terms of big government versus small government is sterile without the notion of limited government. The proper understanding of limited government provides the judgment on the government programs on offer from the current and prospective administrations.
The gist of the column seems to be Bill’s is opposition to small-government conservatism. He urges conservatives opposing big government public works programs not to oppose them as irreconcilable with the proper ends of constitutional government, but rather to accept them as inevitable.
“Small government” conservatism is, as I have argued, intellectually satisfying but unrealistic and even politically counterproductive. If you are concerned with the philosphy of conservatism as a coherent set of principles that should be the ideal for a just and moral society in the abstract, then small government conservatism makes sense.
But if you seek to use conservative principles to govern a hugely diverse nation of 300 million people with clashing interests, differing needs, and even different ideas of what it means to be an American, then there should be a realization among conservatives that there is no “big” government or “small” government at all. Rather, it is using government to address the legitimate needs of the people consistent with the Constitution that matters in the end.
After all, there is nothing in the Constitution which states that government needs to be big or small. There are only limits placed on what government can do. Inherent in those limits may be the ideal of small government. But surely there is room for limited government while recognizing government’s legitimate responsibilities. For instance, the question of whether we must have drinking water that won’t kill us if we drink it is not addressed in the Constitution. And common sense should inform us that we can’t have 50 different standards for clean water. Ergo, assuring a supply of clean drinking water for its citizens is a legitimate function of the federal government.
We can argue the finer points of the Clean Water Act, including some regulations that are unnecessary and burdensome. But the basic notion that only the federal government can keep criminally irresponsible individuals and businesses from contaminating something so basic to life remains.
Is this “big” government? Or is it recognizing that in a nation of 300 million people who need clean water to stay alive that it must be the federal government’s responsibilty to oversee the process?
Readers here have engaged in spirited discussions in the comments about the nature of modern conservatism and its relevancy in a 21st century industrialized democracy. I believe that unless that debate includes ideas about the political relevancy of conservatism in a nation where “limited” government is preferrable to either “small” or “big” government, then conservatism itself will become an irrelevancy and the remaking of America by Obama and the liberals will become a foregone conclusion.
You’re right about conservatism. You guys need a realistic update of “small” government.
But Obama isn’t going to let you have that middle ground. He’s taking the middle, despite your inflamed language about a “radical restructuring.”
You don’t do yourselves any favors by failing to understand your opponent. You haven’t gotten Obama or his voters from the start. You still don’t get him or us. It’s one reason you guys lost the election. And continuing to substitute ideological animus for clear analysis will get you nowhere.
We are the middle. Obama and his voters are the middle. And we aren’t radically restructuring or radically doing anything. There’s nothing radical going on here. We’re repairing the damage done by radicals. They just happen to be your radicals.
Issue by issue, we are the middle. Look at any poll you like. On the war, on the economy, on health care, on taxes, on environment, on social security, on abortion, on gay rights. On just about every issue you look at, Obama and the Democrats are the middle.
I suspect there’s no market for your rational conservatism in the GOP. The only battlefield for you guys going forward is in the suburbs and I think you’re a generation away from taking those back. So, I don’t think you’re going to peel your party away from the nutty religious fringe any time soon because the truth is the bulk of the GOP lives down a two-lane road and we have the freeways, the boulevards and the cul-de-sacs.
You need to face up to the awful truth: your future, Rick, is with us.
Gabba gabba, we accept you, we accept you, one of us.
Comment by michael reynolds — 12/8/2008 @ 4:11 pm
I for one, am sick and tired of government. Just sick of it. I can hurl when I listen to Barry Dunham, hem and haw, trying to sound like he knows what he’s talking about, especially when it comes to auto manufacturers.
Barry-boy, Botox Pelosi, Botox Biden, Chinless Harry Reid, Chrissy “the crook” Dodd, Teddy “the swimmer” Kennedy, Chucky “ambulance chaser” Schumer - these lawyers with little knowledge about anything, little skill other than pontificating are going to plan our lives for us.
Government IS THE PROBLEM. Get off the government nipple. Live your own life.
Comment by Nessus — 12/8/2008 @ 4:27 pm
Nessus,
I’m not sure evoking Bakunin is the answer to the current crisis.
I for one never understood why so many conservatives have a problem with ‘conserving’ the environment. I think it has more to do with identity politics (all those tree huggers) than rational analysis. So of course the Clean Water Act makes sense and was (is) very successful.
As far as the bail-out is concerned, I have yet to hear ‘conservative’ proposal. I’m not exactly sure how to proceed myself (but open to education, smile).
Comment by funny man — 12/8/2008 @ 5:26 pm
So, I don’t think you’re going to peel your party away from the nutty religious fringe any time soon because the truth is the bulk of the GOP lives down a two-lane road and we have the freeways, the boulevards and the cul-de-sacs.
I love the smell of hubris in the afternoon.
Comment by John Howard — 12/8/2008 @ 6:01 pm
I guess we are all children these days, with the memories of children (or lack thereof). Economies boom and bust, boom and bust. Gee, this is so hard to understand…..That’s why it’s wise not to over-extend oneself. Wise to save money.
There is such a thing as a business cycle. It goes up and it goes down. Doesn’t matter which suit occupies the White House. Government can do a little but not much when it comes to “stimulating” the economy.
Want to help stimulate the economy? Cut taxes drastically, across the board for firms and people. Make our country more inviting for businesses to start and to expand. Rocket science, huh?
Of course, spending must be cut drastically too. Start with the Dept. of Education and Dept. of Commerce. Now Barney F*g, Nancy Botox and Chucky Schumer want to become automotive engineers. What a joke.
Government is nothing more than a middle man who takes money from productive people, launders it and passes it out to it’s favorite constituents in exchange for promised votes.
Government is lawyers, therefore the size of government will never to reduced. Government is the problem.
Comment by Nessus — 12/8/2008 @ 6:02 pm
How am I to interpret Barry The Great Redeemer? His pearls of wisdom on economics this past weekend were laughable. “Modernize school buildings?” ROTFL!
Our new boy-king truly does harbor socialist leanings.
Prediction: Big time conservative backlash and recovery in 23 months in 2010. Big time.
Comment by JP — 12/8/2008 @ 6:32 pm
[...] The Corner, The Hill’s Blog Briefing Room, Copious Dissent, Below The Beltway, Wonkette, Right Wing Nut House, StephenBainbridge.com, RedState, Washington Monthly, The New Republic and [...]
Pingback by Bill Kristol Enrages Libertarians | Political Byline — 12/8/2008 @ 6:41 pm
My opinion of the role of federal government is that it should essentially concern itself with the following:
-Economic and trade policy which supports long-term growth and can respond adequately to changing real world conditions (domestic and foreign)
-National defense (military, border security, internal security)
-Public health and safety (i.e., prevention and control of disease outbreaks through adequate immunization, sanitation standards, etc.
-Public emergency response (which needs to be carefully and competently integrated with state and local response) - law enforcement, disaster recovery, etc.
-Maintenance of national transportation infrasutrcture (air traffic control, seaport control, interstate highways and non-private rail lines)
-Upholding law and liberty in the context of constitutional guidance
The Democratic party ideology seems to advocate a “federal government knows best” approach to the above points, and public services in general. While I have seen this concept work quite well in small, well integrated countries like Singapore (where I now live), it relies heavily of federal government knowing exactly what is going on at a macro- and micro- level, and having the resources and plans of action to do the right thing. I do NOT see this happening in the US; the bureaucrats is Washington are so often out of touch with the people they supposedly represent, that it would be impossible for them to make accurate decisions about the welfare of the entire country on a consistent basis.
The GOP tends to advocate more of a state-level approach, rather than federal government involvement. Even at state level, much of the government is ineffective due to incompetent/clueless politicians and various budgetary constraints.
I don’t have an easy answer to the problems that the US is facing now, but there are many areas that need a serious rethink with regard to who has oversight authority and the scope of that authority. Above all, the many facets of government need to be well integrated to be effective and eliminate the “pork” and gross waste of taxpayers money.
Comment by Mark Turner — 12/8/2008 @ 8:06 pm
How do you morons figure anyone should listen to you? Have you ever been right about anything, ever?
Considering that we just went through the longest, most sustained economic growth in the history of industrialized civilization, you would do well to listen.
ed.
Comment by Levi — 12/8/2008 @ 8:22 pm
I for one, am sick and tired of government. Just sick of it. I can hurl when I listen to Barry Dunham, hem and haw, trying to sound like he knows what he’s talking about, especially when it comes to auto manufacturers.
Barry-boy, Botox Pelosi, Botox Biden, Chinless Harry Reid, Chrissy “the crook” Dodd, Teddy “the swimmer” Kennedy, Chucky “ambulance chaser” Schumer – these lawyers with little knowledge about anything, little skill other than pontificating are going to plan our lives for us.
Government IS THE PROBLEM. Get off the government nipple. Live your own life.
Government is the only reason you don’t live in a cave. Do you like having roads and a military and hospitals and schools? All of those things exist because of government. Do you like the idea of civilization? Of rule of law? Of a code of ethics? These principles flow from government. Government has guided human development for thousands of years. As a species, we’re as complicated and complex as we’ve ever been, and to think that we’ve outgrown the need for the organ that is fundamentally responsible for getting us here is just stupid.
Government isn’t the problem. Morons electing other morons to run the government as poorly as possible is the problem. There’s nothing inherently evil about the idea of government. That’s such an obvious propaganda play from big business that if you can’t recognize it you really are useless for most purposes. You can scrub toilets, maybe.
Comment by Levi — 12/8/2008 @ 8:33 pm
Interesting points… when I think about conservatism as I grew up believing in, I have always thought that “small” government was the best approach. What a shock it was to discover that America has not been functioning on a “small” government for quite some time. And of course, the bailouts are the most recent example of this. It just makes me recoil in horror to think that not only are there liberals up there in Washington who are embracing these hude government bailouts, but no one is asking what the possible long term effects of huge government spending may be! One of my favorite posters on http://www.despair.com reads “GOVERNMENT: If you think the problems we create are bad, just wait until you see our solutions”.
I think you hit on something here: as Republicans we do need to find relevant alternatives to expanding the size of government, because fighting for small government is an irrelevant battle if small government no longer exists.
Comment by Shelby — 12/8/2008 @ 10:05 pm
Hey Rick, seeing how our soon to be ex-president promised to reduce the growth in government yet consistently increased it in size, would it not be possible for our next president to say he will increase government yet actually slow down its growth? Obama is looking to be quite the pragmatist/realist with his cabinet picks; perhaps he will take a similar approach to the budget as well.
Comment by Surabaya Stew — 12/9/2008 @ 1:12 am
Levi, the limp-wrist said: “There’s nothing inherently evil about the idea of government.”
Did mommy and daddy send you to law school, baby boy? You like to be cared for, don’t ya boy?
What a waste. Govermnet is force; it’s coercison? Who said that Levi-boy? G. Washington.
Government is LAWYERS. I want nothing to do with sending my money to lawyers in order that they “launder it”, then pass it out to their favored constituencies. That’s government Levi-boy.
Maybe your leg too tingles whenever you see Barry Hussein, you get a little sexual jolt. Go ahead, admit Levi-boy.
Or perhaps you have trouble understanding English. I don’t like nor want government. I am as self-sufficient as possible and I love it. Period.
Comment by JPP — 12/9/2008 @ 7:31 am
One of the better reasoned articles this month. As Ned Barnett pointed out in today’s American Thinker article on Obama’s end run around Congress the stars are aligning to make the stimulus bill the sun setting of the little government folks, conservatives, libertarians and fiscal conservatives et al.
We have all this activity including Ted Kennedy writing the national health care act on his hospital bed. Rahl Emanual declares never let a crisis go to waste. Tom Daschle states it’s best to not debate controversial health care. Obama openly stoking the doom and gloom by saying the Grim Reaper is in the building and will not leave until his stimulus bill passes.
A great “strategery” to strike at this time. One would not be surprised if even amnesty for illegals is tossed in as part of the “recovery” since all economic issues would need to be dealt with in toto. As Rick points out the Congressional Republicans have almost a Hobson’s choice. Add some drama, perhaps, of votes on Jan 19 at midnight or such with suspension of the rules including filibuster if needed and a new day will truly dawn on Jan 20. The MSM likely will not even give a Republican (including McCain) face time.
On the plus side, now would be a good time to invest in green companies. Anyone know if there is a market in union futures?
Comment by cedarhill — 12/9/2008 @ 10:56 am
Well, once again, a great series of thoughtful articles on a new “middle way” for the conservative movement. Though we might disagree on many of the specifics, you pretty consistently point a way forward for your wayward movement and yet, to judge from the foaming mouthed responses here and elsewhere, it’ll take years in the wilderness for your partisans to sort themselves out. They truly do seem more inclined to suffer a depression than to even hope for things to work out, let alone contribute to productive compromise.
You said it clearly:
“But if you seek to use conservative principles to govern a hugely diverse nation of 300 million people with clashing interests, differing needs, and even different ideas of what it means to be an American, then there should be a realization among conservatives that there is no “big” government or “small” government at all. Rather, it is using government to address the legitimate needs of the people consistent with the Constitution that matters in the end.”
But it appears your compatriots don’t perceive such a nation. They seem to see some misty fiction of a country that only exists in their dreams; homogeneous in all ways and adhering to their particular ideas about government. Good luck!
Comment by emgersh — 12/10/2008 @ 12:22 pm