Crony Capitalism and the Conservative Politics of Resentment

Why it is that conservatives (as distinct from libertarians) are seen as “trying to dismantle the welfare state and remove all economic regulations” when this obviously is not the case? So asks Greg Forster. He’s right that this is one of the many lines of attack from the left, but I don’t think that the biggest problem conservatives face is the sense from the public that conservatives want to get rid of the welfare state. I think that the real problem for conservatives is the idea that they are pro-rich and either ignorant or contemptuous of the priorities of the non-rich.

First, let us start with where some people might get the idea that conservatives are radically opposed to the welfare state. You can find examples like Rick Perry calling Social Security a Ponzi scheme and 2010 Alaska Republican Senate nominee (and Tea Party favorite) Joe Miller questioning the constitutionality of unemployment insurance. That kind of talk can make it sound like conservative candidates only accept the existence of a welfare state as a grudging concession to the voters and gives the impression that conservatives would gut the welfare state when the electorate’s back is turned.

But I also wouldn’t read too much into the political impact of such statements. Joe Miller’s comments probably helped cost him a Senate seat, but what fraction of the people in the lower forty-eight states even remember that Joe Miller ever ran for anything? As for Rick Perry, his comments did not get in the way of Mitt Romney winning 56 percent of the senior citizen vote—this despite Romney coming out for premium support Medicare. The recipients of America’s largest social welfare programs were not especially worried that the right was going to get rid of the welfare state.

There is probably some fraction of young voters who might be persuadable but who think that conservatives want to get rid of the welfare state and leave people totally on their own. My sense is that these persuadable (or potentially persuadable) voters experience politics passively and almost entirely in a partisan center-left form. They hear about politics when some cause (global warming, abortion, whatever) crosses over from the news to the entertainment media. Their social networks are not politics-focused, but the people in their social networks who do care about politics are very likely to be center-left.

This isn’t exactly about ideology among the young. A report by the College Republicans showed support for conservative positions among a substantial number of young people. The real gap shows up in activism. According to a study by the Harvard Institute of Politics, only 8 percent of young voters identify with the Tea Party. That means that the proportion of Tea Partiers among the young isn’t that much higher than the proportion of Romney voters among African Americans. The result of this weakness of conservative activism among the young is that many basically nonpolitical young people experience politics when one of their more politically engaged peers posts a link about the latest stupid thing said by someone on the right. We saw the ability of the left to drive the debate in the 2012 cycle, but the target wasn’t the libertarianism of Republicans. It was about tying all Republicans to Todd Akin.

This basically nonpolitical person could be convinced that conservatives are radical libertarians who are hostile to the welfare state. They can also be convinced that conservatives are radical authoritarians. They can probably even be convinced that conservatives are both of those things at the same time. That is what can happen when politics becomes a monologue and until conservatives figure out a way to break through and speak directly to this group, the problem will persist.

But that doesn’t get to the real problem. In the 2012 exit poll, 53 percent of voters said Romney’s policies would primarily benefit the rich and only 34 percent said Romney’s policies would primarily benefit the middle-class. Even a substantial number of Romney voters thought that the rich would primarily benefit from Romney’s policies. That doesn’t mean they thought Romney was against the existence of the welfare state as such, but they might have noticed that Romney’s tax plan would have overwhelmingly benefited high-earners, and that Romney had disparaged people just on the other side of the earnings median as being unwilling to take responsibility for their own lives. One thing that both Tea Partiers and the Republican establishment had in common was their unrelenting focus on the high-earners who “built that.”

One way of trying to get around this perception of being unfairly pro-rich is by targeting crony capitalism. The idea is something along the lines of “Hey look. We’re cutting the subsidies to these rich people. See? That shows we are pro-freedom, not pro-rich.”

Yet the crony capitalism strategy treats the perception of conservatives as being pro-rich as primarily a problem of resentment. People resent the rich for getting too much unfairly, and so conservatives must target the undeserving rich. But I think that most middle-class and struggling people are more focused on their own problems and anxieties. Cutting crony capitalism has to be a means to an end rather than an end in itself. If the purpose of cutting crony capitalism is to free up money to cut the top marginal tax rates on high-earners, then conservatives aren’t going to seem any less pro-rich for wanting to cut the Export-Import Bank and subsidies to green energy companies. That is the flaw in Rand Paul’s flat tax plan. All the cuts to special interest deductions and subsidies won’t help if your plan is a sharp tax cut on high-earners and a tax increase on middle-class parents.

If cuts to special interest tax deductions and subsidies become a way to partially offset tax cuts for working parents and extending catastrophic health insurance to people who don’t have access to employer-provided coverage, then conservatives have a chance to shake the perception that they are just the political bagmen of the wealthy. That doesn’t mean the left won’t continue to make the same old accusations. It just means that somewhat fewer people will find those accusations plausible.

The good news is that the right is working on a middle-class agenda. For a while now, wonks and journalists like Ross Douthat, Ramesh Ponnuru, Yuval Levin, and James Capretta have been proposing policies that would directly impact people whose earnings are close to the median income. What is interesting about this AEI event is that the reformist conservative intellectuals are being joined by prominent politicians across the center-right spectrum. You have both Senate Republican leader Mitch McConnell and Mike Lee (the best of the Tea Party-affiliated senators) addressing the conference. We have reason to hope that things are starting to get better.