Peter Smith

Athens on the Potomac

After Obama’s election win, the head of the major union umbrella body, Richard Trumka, AFL-CIO President, called for increased taxes on the rich, no cuts to entitlement programs, and a relaxed attitude to the budget deficit. In other words, welcome to Greece writ large.

Obviously, along with numbers of union bosses, he sees himself as a future commissar once the capitalist system has been destroyed. There can be no better illustration as to why the GOP should hold fast to its conservative economic principles, despite all the post-election blues and soul searching.

After all, what are these principles that so offend the sensibilities of the left. They are small government and individual self-reliance. They are designed to produce a more self-fulfilled, prosperous society, better able to help those in real need. These are principles worth prosecuting and defending.

The economic principles of the Democratic Party, and of the left more generally, are wrapped around big government dispensing largesse to increasing numbers of the population. This is regarded as a caring and empathetic response to disadvantage. But there is no end game. The whole rationale depends on government getting bigger and bigger. The effect is to undermine self-reliance and promote dependency. That is caring and empathetic only in the mind of would-be despots.

Moreover, dispensing largesse doesn’t pay the bills. To what extent do leading Democrats, and all those on the left, factor paying the bills into their worldview? I simply don’t know. I have never been able to pin them down.

Only Romney had a plan to reduce the rate of growth in entitlements, and the debt and deficits which are threatening the future wellbeing of America and the free world. Whether his plan went far enough and would have worked is a matter of conjecture, but it was the only game in town. Obama put forward no plan. So, he had a lousy economic record, economic circumstances are dire, and he had no plan. How exactly did he win?

Quite simply the election in the US wasn’t won or lost on anything to do with substantive economic matters. Young single women and Hispanics voted for Barack Obama in droves and too many Republican voters stayed at home. Did any of this happen because people had analysed the economy and felt Obama was best able to reduce debt and deficits? Hardly; not even the most committed Democrat would claim that outside of the spin zone.

Targeted messages on women’s rights and immigration energised young women and Hispanics and the ground game got them out to vote. Republican ineptitude helped the process along.

Mitt Romney was a highly competent businessman who would (I think) have been an ideal president to get the budget and the economy into shape. But whoever advised him to (or didn’t advise him not to) talk about “self-deportation” of illegal immigrants should be sent to the equivalent of Siberia. How inept can you get without being an imbecile? Why not just throw away Hispanic votes.

This is a no-brainer. Your policy is to first build impregnable borders (avoid advice from Gillard) and then to set out an unthreatening path for those adults in the US illegally to earn permanent residency and their children citizenship.

And this reproductive business with single women has to be put to bed, so to speak. Many young single women want the potential safeguard of being able to terminate an unwanted pregnancy. In the past women have been forced into backyard abortions. This is not sufferable.

Churches and parts of society can legitimately condemn terminating life in the womb. But condemning and outlawing (abortion in early term and in circumstances such as rape and where the baby would be disabled) are two quite different things. The Republican Party will always have committed pro-lifers in its ranks, but it can’t afford to have complete fools like Ted Akin and Richard Mourdock, both of whom lost what should have been safe Senate elections by making fatuous remarks about rape.

It is possible to be pro-life and a Democrat. It has to be made possible and respectable to be pro-choice and a Republican. Then the GOP won’t be so scary to so many young single women. Small government can’t be allowed to founder on an ethical/religious issue if for no other reason than big government and the dependency it creates goes hand in hand with moral decay.

On the other side, Romney simply failed to get people enthusiastic enough to vote. Amazingly, Fox News reported that fewer Mormons voted for Romney than voted for McCain.

It wasn’t just Romney; his backroom staff hardly starred. Project Orca, built around software designed to identify likely Romney supporters who still had not shown up at polling stations on Election Day, apparently performed woefully. One campaign official was reported as saying, “that pretty much everything about the system that was supposed to work actually failed”. Incompetence is always waiting to strike, as it did.

Back to Romney the candidate. I found him to be impressive. My wife thought he was wooden. I thought so too but didn’t mind. I have a feeling that lots of people wanted more pizzazz. Clearly Romney is a pragmatist not a conservative. A true conservative would likely have shown more passion.

The answer next time is to court the young single women and Hispanic vote; to have a much better ground game to bring out the base; and to energise the base by running a true (economic not social) conservative candidate. As well as showing more passion for the cause, the nonsense Romney spouted about the 47 per cent would not even enter the head of a conservative. Conservatives want to give the opportunity and incentive to everyone who is able to work to earn enough to pay tax.

The economic situation in the United States will be parlous in 2016. The US economy is resilient and may continue to recover despite Obama. But US federal government debt will be $20 trillion plus in four years’ time. Obama is philosophically incapable of showing the leadership required to control entitlement spending. His taxes, environmental regulations, financial regulations, and health care law will weigh heavily on business. The GOP should romp home in 2016 (and do well in the mid-term congressional elections in 2014), if they give themselves half a chance.

Peter Smith, a frequent Quadrant Online contributor, is the author of Bad Economics

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