Republicans Need an Actual Plan To Grow the Economy
The biggest beneficiaries of economic growth are poor people. But the deepest case for economic growth is a moral one.
After disappointing midterm election results for Republicans, many understandably pin blame on corrosive figures like former President Donald Trump. His losing record is impressive considering his cultlike persona appeal with MAGA voters. If Republicans finally learn to shed Trump and his ilk it will be a good thing. However, there's another looming issue for Republicans: their policy agenda (if this mishmash deserves such a name).
Let's face it: These last few elections weren't contests over conflicting policy visions. Instead, each party did little more than tell voters that they aren't as awful as the other party. Pointing that out is OK but doing so isn't a substantive agenda. Republicans, for instance, were all about how Democrats created inflation and how inflation was terrible for the American people. But Republicans themselves offered no plan to tame inflation. Where are the GOP's plans to control spending? Such control is necessary at the very least for the government to meet its debt-servicing obligations—which are rising with interest rates—without fueling inflation further.
Meanwhile, Democrats have spent the last campaign freaking people out that Republicans will cut Social Security. Whether that's true or not, Americans should be worried about the Democrats' do-nothing policy. Indeed, under the current policy, the Social Security trust fund runs dry by 2034 and benefits will be automatically cut by at least 25 percent, leaving little room to shelter the most vulnerable seniors who truly depend on it for most of their retirement income. This inevitable scenario will happen even sooner now that inflation has jacked up benefits. In practice, by doing nothing, Democrats too want to cut benefits.
Yet you didn't hear the Republicans make that point during the campaign. Nor did they make the case for reforming the program before its impending insolvency. They were completely silent on the need to reduce government debt policies. I understand that these are unpleasant topics of conversation—it is the proverbial "root canal" of policy, as the late Jack Kemp liked to say. But ignoring these realities will not change them.
What's more, in the rare occasions that Republicans have a policy idea, they're usually calling for awful and outdated ones such as industrial policy and protectionism, or even Democrat-like entitlements such as federal paid leave and a child universal basic income. And that's when Republicans aren't making the economically ignorant case to drop "market fundamentalism" and embrace central planning.
At this writing it appears that Republicans will have only the slimmest of margins, putting meaningful reforms out of the question. Instead, Republicans should use this time to educate the public. Impressing upon people the need to put government on more secure financial grounds can be done by explaining the negative impact of large government indebtedness on economic growth. Economic growth might not be popular now, but this makes it a perfect educational moment to note that a robustly growing economy can double the average American's living standards in a single generation.
And growth is especially important for the lowest income earners in America. The reality is that the biggest beneficiaries of economic growth are poor people. But the deepest case for economic growth is a moral one, as it affects our social attitudes and political institutions by reducing homicide rates, increasing female and minorities' empowerment, promoting tolerance and democracy, and so much more.
The good news is we know how to pull off all these benefits for our communities. As multiple scholars have established, there is a solid and positive association between economic freedom and growth. Economic freedom reforms that unleash supply in sectors like energy, housing, food, and health care will produce the largest rewards for all.
This can be done by removing idiotic regulations that require years of permitting to build roads and infrastructure, and to produce drugs—without significantly helping the environment or increase consumer safety; also, eliminating biofuel mandates—which increase the price of energy and food, and hence intensify food insecurity; reforming occupational licensing, zoning, and land-use restrictions; and ending subsidies to big agribusiness and other producers—payments that distort pricing and end up forcing consumers to pay more for less. There are so many exciting things that Republicans could embrace and reach across the aisle to promote a growth and opportunity agenda.
Republicans want to show voters that they care about the working and middle classes. They need to snap out of their policy lethargy and rediscover the excitement of championing policies that lift all boats and truly make America once again the land of opportunity.
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