The Appeal of Incoherence

Ross Douthat is back to blogging. Here he takes on the new conservative populism:

From Glenn Beck to the Tea Parties, much of the energy in the post-Bush G.O.P. is with people who have grasped, albeit sometimes in inchoate ways, that big government and big business are increasingly on one team, and the champions of free markets and limited government are on the other. But they don’t know what to do about it, and what they do seem to know — cutting taxes, and letting the rest take care of itself — is often non-responsive, not only to the problems the country faces, but to the problems they themselves have diagnosed.

Speaking as an Obama administration apologist, I’m glad to see the incoherence noted. But it’s also worth saying that incoherence strikes me as incredibly appealing. The main issue here is, I think, the incredibly unpopular TARP “bailout” bill. I believe that absent the bailout, we’d be looking at even higher unemployment today. But it was and remains incredibly unpopular and has done a lot to sour the public on the idea of activist government. It also raises, I believe, serious questions of moral hazard and social justice. These issues would best be addressed by more stringent regulation and higher taxes on high-income individuals that are used to fund more and better public services. And that’s what the administration is proposing.

But conservative populists, by insisting that the real answer is basically to go back in time and not do the bailout have created a win-win-win situation for themselves. In the congressional debate over financial regulation, conservatives have proven themselves to be slavishly loyal to the interests of large financial firms. And in the congressional debate over taxing the wealthy to expand access to health care, conservatives have proven themselves to be slavishly loyal to the interests of rich financiers. But via their meaningless denunciations of bailouts, they’ve positioned themselves as on the side of anti-banker public opinion. And yet precisely because this rhetoric is so non-credible, they continue to receive generous financial support from big finance and from big business in general. Meanwhile, the public largely holds Barack Obama responsible for public policy even though it’s possible for congressional minorities to thwart his agenda. Thus he so far bears the brunt of public distaste not only for the bailout, but also for congress’ unwillingness to enact his own regulatory agenda.

Moving to a less-incoherent posture would have some real benefits, but also disrupt the current sweet deal.