The Republican Party retains, as its soul, its opposition to government intervention in the economy. On Friday afternoon, two CPAC panels demonstrated that the party can take this core commitment in two directions: either further down the dead end of applied Austrian ideology, or towards an problems-oriented application of free-market principles, one that responds to political issues in evidence rather than divining solutions from on high.
The GOP’s conventional economic wisdom was well on display at the panel entitled “The Europeanization of America.” Two European Parliament members huffed warnings (representative line: “you could compare Greece with California”), while two Republican members of the House treated the Continent as if it were being autopsied before the audience. Nowhere was there an attempt to seriously grapple with Europe — its across-the-board higher living standards and minimal economic inequality — or really do anything other than crow about the superiority the American economy to its European competitors. One couldn’t have imagined a better demonstration of the staleness of GOP economic doctrine.
But a panel directly afterwards — on whether we are “back on the road to serfdom” — offered two ways forward. Following the first, however, likely wouldn’t take the GOP to a place it wanted to go. Brian Domitrovic, a professor at Sam Houston State University, advocated the abolition of progressive income taxes and the Federal Reserve and a return to the gold standard. He surmised that, had we never left the gold standard, our GDP would be double its current size today. Res ipsa loquitur, I suppose.
The second speaker, The Washington Examiner‘s Tim Carney, developed a far more persuasive vision of conservative economic policy. Carney’s well known for his critique of crony capitalism, the fusion of government and business interests to the detriment of both, but what made his presentation interesting was its development of that theme into a broader guiding philosophy for conservatives, one that even some progressives might find something to like in.
On Carney’s picture, the central problem afflicting today’s political economy is its total penetration by big business. Businesses (he used General Electric, Boeing, and Microsoft as examples) devote extraordinary resources to lobbying, because, in its current state, the political system makes it a quick, if not necessary, path for prosperity. There are innumerable pathways to get tax breaks and legislative protections for one’s patented products through federal legislation, and corporations with means, being rational enough to recognize this, exploit them.
For Carney, this isn’t just one economic problem: it’s a fundamental one. The government-business nexus crushes what entrepreneurial “virtue,” it makes success not so much about hard work but ascending to the top of the corporate ladder inside a company whose advantages are guaranteed by federal fiat. People aren’t encouraged to innovate so much as conform, damaging both economic productivity and the moral character of people who attempt to participate in business. Or, in Carney’s words, “When you become a beggar, you become something slightly approaching a serf.”
Progressives concerned with the growing power of big business in our society should find a lot here. Carney didn’t propose much in the way of solutions, but a generalized vision of markets as a zone of society that all people, not just the powerful, should have access to is a radically anti-corporate one — one whose implications could be far more egalitarian than Carney would likely want. At the very least, it’s a conservative economic vision oriented around a real threat to our free market system — and not the imagined spectre of European socialism.