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Monday, February 11, 2008
Conservative Sclerosis?

Ross Douthat has a must-read editorial about how we got to this point, with the only two contenders left in the Republican field being the ones that Rush Limbaugh and others deemed unacceptable.

The conservative critics of Mr. McCain and Mr. Huckabee weren’t wrong on every issue. But in their zeal to read both candidates out of the conservative movement, often on the flimsiest of pretexts, the movement’s leaders raised a standard of ideological purity that not even Ronald Reagan could have lived up to.

Indeed, Ronald "Amnesty" Reagan would be considered a liberal by some in the conservative movement. But there are a number of other issues going on here as well:

1. Success breeds failure in two-party politics. This seems paradoxical, but it's true. As one party succeeds disproportionately, as the Republicans have for the last 28 plus years, many of its programs become implemented. Either they work, in which case they cease to be issues, or they don't, in which case the other party sweeps into power to repeal those programs. Consider high marginal taxes on upper income individuals. In the 1930s and 1940s punitive tax rates were imposed on individuals. But in the 1960 election John F. Kennedy ran on a program of cutting back taxes on the upper bracket from 90% to 70%. Effectively, upper-income individuals were able to keep three times as much of their income (from 10% to 30%). This freed a great deal of capital to be put to work in the economy as investments. When Reagan later lowered the top marginal rate from 70% to 50%, the effect was to allow upper-income individuals to keep 66% more of their income (from 30% to 50%. When the 1986 tax cuts reduced the top marginal tax rates from 50% to 28%, the effect was to allow upper-income earners to keep about 44% more of their money (from 50% to 72%). But even the Laffer curve has a limit.

Even with the Clinton tax increase upping the top marginal rate to 38%, in order to give another 40% boost, the tax rates would have to be reduced from 38% to 13.2% (so that people would keep 86.8% of their income rather than 62%). More important, no Democrat is running on a pledge to increase taxes significantly on upper-income individuals. So Republicans not only can't promise taxpayers another big tax cut, but they can't even scare those people with the prospect of a big increase if the Democrats are elected.

So what has happened? Upper-income individuals are voting on other issues than taxes, which inevitably hurts the Republicans at the margins

2. The failure of the Republicans to win on core social issues may be disenchanting social conservatives. Abortion has now been legal everywhere in the USA for 35 years. The culture has grown markedly more coarse during the Republican era (not blaming the GOP, just noting that it has been unable to stop the erosion).
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