Conservative Populists’ Task is to Monitor the Punch Bowl
Working-class-oriented conservatives are starting to reshape their party. But they can keep populists of all stripes sober
To think that just over a month ago I was complaining that the 2024 election rematch was going to be a uneventful slog…
The ascent of Vice President Kamala Harris to the top of the Democratic ticket hasn’t been fueled by policy proposals, though what she has proposed in her time on the national stage provides some suggestions of how she and her staff think. In 2018, then-Senator Harris she proposed a new, monthly, refundable $6,000 tax credit for families making less than $100,000. During her short-lived 2020 campaign, she offered a memorable, oddly-specific proposal to forgive student loans for “Pell Grant recipients who start a business that operates for three years in disadvantaged communities,” almost a parody of progressive hypertechnocratism.
Then came the pandemic, when she joined Senators Bernie Sanders (I-Vt.) and Ed Markey (D-Ca.), in proposing legislation that would provide monthly $2,000 stimulus checks to households making below $120,000. Married couples would receive $4,000, and $2,000 per child up to three children (blatant anti-big family discrimination, even in a pull-out-all-the-stops spending blowout? For shame.) for as long as the pandemic lasted.
No one was especially attuned to budget constraints during the height of Covid, but the budget-busting proposals continued on both sides of the aisle. In April 2021, Sen. Josh Hawley (R-Mo.) introduced legislation that would have created a fully refundable tax credit, on top of the existing Child Tax Credit - not at all dissimilar from then-Sen. Harris’ 2018 proposal. The Parent Tax Credit would have been $6,000 for single parents, and $12,000 for married parents, for all households with a child under 13 and earnings over $7,450.
As is now clear, our pandemic response did not hurt for underspending. Having learned from the sluggish recovery after the 2008 recession, the Biden administration intentionally overshot the mark on stimulus checks, local aid, and other aspects of the “American Rescue Plan.” While it doubtless helped fuel inflation, the average American household came out with a much stronger balance sheet post-pandemic than it had heading in. With the benefit of hindsight, it’s easy to see neither the Harris-Sanders-Markey nor the Hawley approach would have been the right approach, and almost certainly would have been counterproductive in the form of higher demand-side pressures on inflation and even greater increases in the federal deficit.
This is the tension in letting a populist approach to economics get too far over its skies. Everyone liked getting their “stimmies,” and ideas like student loan forgiveness or eliminating taxes on tips appeal to various constituencies without seeming to gore any one party’s ox.
But in an era where deficits matter, even tax expenditures that don’t make any one constituency worse off make it harder for the Federal Reserve to do its job, and continue the upwards spiral of debt that increases the cost of borrowing for not just the U.S. government but the economy as a whole. As I wrote for National Review last summer, the supply-side insight many conservatives bring to bear on economic issues can, properly understood, be the key to unlocking pro-family growth:
Conservatives can and must be more clear-eyed. Increasing the productive capacity of the economy in areas that burden family formation isn’t as glamorous as splashy new programs, and reforming current spending is politically challenging. But in a political moment dictated by concern about growing deficits, those efforts need to be front and center for pro-family conservatives.
In general, the renewed focus on working-class issues from Senators like Hawley, J.D. Vance (R-Ohio) and Marco Rubio (R-Fla.) is a welcome breath of fresh air for the right and the country at large. Even in a divided Congress, one can easily imagine opportunities for convergence between the populist right and the standard-issue progressive left. As a recent piece by John Cassidy in The New Yorker points out, “it’s possible to imagine…an alliance of convenience to support certain efforts, including strong antitrust enforcement, increased funding for worker training, and expanded child tax credits, although the conservatives’ insistence on strict work requirements could well be a sticking point on the last one.”
But the newfound attention on working-class families can’t be an excuse for sloppy thinking around policy design and budgetary tradeoffs. Sharp eligibility thresholds, like those found in blue state Child Tax Credits or the 2018 Harris proposal, punish families around the threshold for increasing their hours worked or getting a raise (and, depending on the design, for getting married.) On the contrary, plans like Sen. Mitt Romney (R-Utah)’s Family Security Act 2.0 is intentionally designed to ameliorate work disincentives and marriage penalties, while also fully paying for the increases to the child tax benefit by removing other tax code provisions.
This is what can differentiate today’s conservative populists from yesteryear’s “compassionate conservatives” and other attempts to blend elements of social democracy with the Republican Party. As Matt Yglesias wrote in his Substack earlier this week, the number of genuinely new “big ideas” in American political is relatively small. “What the country needs is not new big ideas (which largely turn out to be recycled anyway), it’s more truth-seeking institutions and quality analysis of specific questions.”
Part of that quality analysis can be - has to be - an eye towards the macroeconomic picture, and the tradeoffs inherent in pursuing, say, generous tax support for child care vs. child benefits more broadly, or forgiving student loans for Pell Grant recipients that operate a business in an underprivileged area for three years vs. student loan forgiveness for all, or just for new parents, or for none. The right needs to engage policy proposals beyond just the reflexive “it costs too much,” because some ideas are worth investing in or paying for. But the left should treat substantive conservative objections as worth taking seriously, rather than attempting to steamroll them in the name of a progressive social agenda that many Americans turn out to not necessarily want.
This can make conservatives - at times - come across as the big drag. But being the Socratic fly in the ointment can be a way of keeping “populist” ideas from getting too out of hand, while also keeping the right from falling into the trap of offering warmed-over leftist economic ideas in the trappings of right-coded symbols and messaging. Until we enter a new economic paradigm, conservatives need to have an eye towards sensible spending (whether explicit or implicit) and the growing federal budget deficit. Lots of those on the right get this; a few do not.
In 1955, chairman William McChesney Martin remarked that the Fed “is in the position of the chaperone who has ordered the punch bowl removed just when the party was really warming up.” When it comes to the ongoing populist realignment, conservatives need to be the one checking IDs and keeping the party from getting too out of hand - not (just) because we’re reactionary buzzkills, but because that’s the only way of delivering sustainable policy solutions instead of counterproductive sugar highs.
Elsewhere
For American Compass, I wrote about three economic trends that should be a silver lining celebrated by working-class-friendly populists.
In my farewell column at CNN Opinion, I argued that the fact that the White House tried to conceal Joe Biden’s diminishment - and would have succeeded if not for an early debate - is a worrisome indicator of partisanship and self-delusion run amok.
Et Cetera
Why Americans aren’t having babies (Wall Street Journal)…Japan asks young people why they are not marrying amid population crisis (The Guardian)…Japan discussing details of making day care available for all infants (Japan Times)…What a big experiment giving money to parents reveals (Vox)…How a Kamala Harris candidacy could supercharge Democrats’ message on abortion (The 19th)…The intellectual journey of JD Vance (The Spectator)…At the RNC prayer breakfast, speakers said the quiet part out loud (Mother Jones)…The trouble with child-free weddings (Common Good)…Sen. Rubio has introduced a bill that would make some changes to the Child Care and Development Block Grant with the aim of allowing more families to have parent- or relative-provided child care…Majority Leader Sen. Chuck Schumer (D-N.Y.) plans to introduce a package of bills on kids and tech, with the aim of securing final passage next week (Punchbowl News)
New York: State launches digital portal to help make low-cost childcare more accessible…Kansas: Kansas City Star endorses child care amendment on August ballot…Vermont: Child care providers have new hope after Act 76, but worries remain…Colorado: Demand for paid-family and medical leave less than expected…British Columbia: Takeover of child care hasn’t helped families…
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