Deregulation: An Insult to Capitalism

The Republican's irrational push for complete economic deregulation is an insult to one of the nation's founding principles: capitalism. Capitalism has succeeded while other systems have fallen by the wayside for one simple reason: greed. Other economic/political systems have tried to ignore or eliminate greed, but not capitalism. Capitalism accepts that greed and ambition are inherit human qualities. Since they can't be eliminated, they should be exploited to produce prosperity.

While greed unleashed has a huge potential for good, it is still greed: the sin which is also the root of evil. Greed is a strong draft horse. If left to its own devices on the farm, it would destroy the crops. It needs to be put to the yoke and guided to get work done. The secret is the make the yoke as light has possible and make sure it does not choke the beast.

Anyone who has studied history should understand the insanity of deregulation for the sake of deregulation. It was the unregulated, profit-at-any-cost labor market that gave the world the slave trade. The unregulated food market gave us Sinclair's The Jungle and recently, poisonous Chinese baby formula. The unregulated capital market is that of the mafia loan shark.

There are great reasons to reduce some regulations. Foolish or overbearing regulations can unnecessarily cripple businesses. They can even drive segments of the economy into the black market. But regulation is necessary to produce trust and broad prosperity in society. To ignore the need for regulation is the ignore the reason capitalism works. The system is powered by greed, and greed will always encourage people to cut corners, run scams, and cheat. The Republican party should stop pushing for deregulation and work towards balanced regulation.

Strong Medicine for Elephants

The road to recovery for the Republican party begins with allowing a universal health care bill to pass. Ideally, they should aim for a working yet imperfect bill that passes with mild bipartisan support. This will allow Republicans to say that they supported the idea of health care while still allowing them to place the blame for any problems (and there are always problems in large scale reform) on the Democrats. The GOP needs health care reform to pass for three reasons: unions, small businesses, and votes.

The Republican Party does not like labor unions, and the feeling is mutual. Voters who have family members in a union are 8% more likely to vote for Democrats. Labor unions also raise millions of dollars for Democratic candidates. As a result, many in the GOP believe that labor unions are bad for business, corrupt, and antiquated. There is a reasonable argument to be made that most of the goals of the labor-movement have already been achieved. The five-day work week, worker's compensation, work place safety, the end of child labor, etc... have all been cemented into law. Health care remains almost the only justification for the maintaining or starting of labor unions. If every American were guaranteed access to affordable health care, labor unions will lose their main draw.

Small business owners tend to vote more heavily for Republicans. The message of lower taxes, self reliance, and less government interference has a strong appeal to this group of voters. The goal of the GOP should be to expand the number of small business owners as much as possible. The lack of affordable health care prevents thousands of Americans from leaving their current jobs to try and start a small business. If you have diabetes, heart disease, cancer, or any number of other conditions, it is impossible to buy individual health insurance. As a result, millions of potential small business owners are economically trapped in their current jobs.

Most importantly, the American people want health care reform. The vast majority of voters are worried about the cost of health care, and 60% of them voted for Barack Obama. Health care is not only a winning issue for Democrats, but also a great issue to raise money off of. Republicans have talked about blocking the Democrats' plans but have yet to put forth a good alternative of their own. It would be a mistake leave the Democrats with such a potent issue to bash them with for another election cycle.

Ronald Reagan is Dead. Let Him Rest in Peace

This is in no way a criticism of Ronald Reagan. He was a very successful and popular president, with numerous good qualities. He is both a fascinating and important historical figure. But that is the problem: he is a HISTORICAL figure. It has been 20 years since he served in public office. The Republican party has been referring to him at an increasing and disturbing pace. They use his name like a magical incantation to try to ward off criticism and evidence of their own failure.

The problem with the GOP's endless referencing of Ronald Reagan is that I have no direct memories of the man. And I'm not alone. Roughly 20% of the American electorate has basically no memory of his presidency (interestingly, these same voters are increasingly voting Democrat), and the problem is only going to get worse. By 2012, half the voters will be too young to have been able to vote for Reagan. If the Republicans want to regain the majority, their rhetoric must not be stuck in the past.

It is understandable the Republicans feel the need to remind people after their last two presidents (one who was a mild failure and the other a complete disaster) that there is such a thing as a successful Republican president. The urge to try to revert back to a happy time is only natural. Much like a mid-aged, unemployed plumber, they seem unable to stop talking about their glory days playing football in high school. Unless the GOP is prepared to lose a whole generation, they need to start looking forward. My recommendation is a complete moratorium on using Reagan's name.

Give Democrats All The Rope They Need on Health Care

A piece of advice for the new congressional Republican minority: give the Democrats as much rope as they need to hang themselves with health care.

Everyone admits that health care is in desperate need of reform. There are already 47 million uninsured Americans, and that number is only going to grow during the economic downturn. Health care commitments are slowly strangling businesses, and even people with health care are watching their premiums rise rapidly.

According to exit polls, the economy dominated as the top issue for voters, but terrorism, Iraq, and health care all basically tied for second. In four years, the majority of American troops will be out of Iraq. And regardless of what happens to the economy, it is unlikely (for good or ill) that it will not be in "crisis" mode. Already, 2/3 of voters are worried about the cost of health care, and the vast majority of those voters voted for Democrats. If nothing is done, it is impossible to imagine that health care won't grow as a decisive issue.

Ideally, the GOP would come up with their own free market solution to the health care crisis and own the problem. That has not happened and likely never will. John McCain's health care plan was a sick joke. Try to make everyone privately buy insurance with $5,000 refundable tax credits! How is this fiscally responsible and not "spreading the wealth around"? The overhead cost of simply sending a bill, depositing checks, and processing 100 million individual Americans would be over a billion dollars. Finally, McCain's plan would make it easier for insurance companies to cherry pick customers and not cover preexisting conditions. This would leave the million Americans who most need health insurance (those will diabetes, high cholesterol, heart disease, cancer, AIDS, etc...) without it.

John McCain's plan was not the answer to our health care woes, and I don't think the Republicans could ever come up with an ideological solution. Health care simply can't work on free market principles because no one wants to die. I can choose what car, TV, or phone I buy, but I can't choose my body. If I don't want to or can't pay for car insurance, I can choose not to drive. If flood insurance is too much, I can move to a drier climate. If I don't have health care, I die. While one can shop around for a primary care doctor, that is not the source of most health care expenses. If I'm being rushed to the hospital while having a heart attack, I don't really have time to do some price comparisons. If my appendix bursts, I either get expensive surgery, or I die. If there is only one medication for my fatal disease, I literally have no choice but to pay any price. There is not a free market solution to health care because there is a lack of freedom. You normally can't wait, can't shop around, can't choose an alternative treatment. Either you get what you need now (at any price), or you die.

If the Republicans are smart they will let the Democrats push through whatever universal health care plan they want and allow them to take the issue off the table. Of course, they can't allow it to look like they are giving up. The Republicans will make a public protest warning about all the new problems the plan will create (and like any large change, it will create a bunch of unforeseen problems), setting themselves up to capitalize on the birth pains caused by the new program. Meanwhile, behind the scenes, the Republican senators will trade their non-interference for concessions on other issues.

Democrats could easily become victims of their own success. With the war in Iraq brought to an end and health care dealt with, they will lose two of their most powerful rallying points. They will also be forced to own all the problems of the new health care program. American voters have short memories. Let the Democrats deal with health care, and it is possible that Republicans can quickly turn the national debate back to friendly ground of taxes, crime, and family values.

40 Years in the Wilderness?

The Republican party until recently has been a three-piece coalition. The first piece is the cultural conservatives-- primarily evangelicals who support "family values." They are the pro-life, pro-heterosexual marriage, anti-gay marriage voters. This is the Sarah Palin branch of the party and still the most loyal.

The second piece of the coalition is the muscular neo-conservative wing. They are pro-military voters. Since 9/11, they have been willing to create massive increases in government power to combat terrorism. They not only believe that America should use force to promote democracy around the world but that we have a moral imperative to. The Iraq war has completely discredited the neo-conservatives. The fast, cheap war of liberation we were promised never materialized. Instead we got a long, bloody, and expensive occupation. After 5 years and nearly a trillion dollars, we may be able to leave Iraq as a highly divided semi-stable country.

Finally, there are the small-government fiscal conservatives. Over the past eight years the Bush administration has managed to turn a budget surplus into a huge deficit. Two expensive foreign wars have drained our treasury. While these moves have bothered the fiscal conservatives, they could be explained as necessary consequences of 9/11. But in the past few days the Bush administration has destroyed the Republican moral authority to small government and sound fiscal policy. The federal reserve just spent $250 billion to nationalize our banking industry, along with another $500 million to be spent buying up bad loans from large financial institutions. A president which only a year ago claimed we couldn't afford to (or just shouldn't) spend $35 billion to provide health care for kid is willing to spend a trillion dollars bailing out AIG, Bear Stearns, Fannie Mae, and the financial sector.

The Republican party has not just failed independent and moderate voters but its own party faithful as well. Many planks of its platform have been discredited or abandoned. While evangelical voters remain loyal, they are neither numerous enough nor geographically diverse enough to support a national party on their own. It is known that the Republican party is headed for its second straight election of huge losses. What is not known is how long the Republicans will be lost wandering in the minority party wilderness. The Republican party needs a Moses to create a new coalition to lead them into the promised land. Who their Moses will be and what commandments he will bring will be the political question of the early 21st century.

Righting the Ship

The Republican party is in bad shape. They recently lost 3 special elections in very Republican districts and are set to lose dozens of House and Senate seats. The question is how to right the ship. The party needs to turn back to its philosophical roots but not lose sight of the future. Here is my humble advice.

1) Clean your House

The Republican party has promoted itself as the party of family, God, and morality. Yet a series of sexual and political scandals have turned it into the party of hypocrisy. To gain its moral high ground the GOP needs to adopt clear standards and a zero tolerance policy. The short-term gain of allowing a disgraced congressman to keep his seat is not worth the long-term damage to the brand. The Republican leadership should loudly and publicly force convicted members like Vito Fossella and Larry Craig out of office.

2) Neo-Conservatism is the Antithesis of Conservatism

The Neo-Conservative movement has highjacked the Republican party and flown it into a mountain. War is too incredibly costly to co-exist with conservatism. You can't shrink the federal budget or cut taxes if you are spending trillions on war and weaponry. The GOP needs to go back to its small government roots, and aggressive Neo-Conservatism just can't be part of it.

The Republican party can still be committed to the goal of spreading freedom with a combination of tax incentives, tariffs, embargoes, and strategic military strikes. We should have free trade agreements with countries like Colombia and India which are moving towards democracy and not with totalitarian nations like China and Saudi Arabia. But preemptive wars and occupations are just too costly.

3) Cut the Pork

Earmarks are terrible. They are terrible for politics, terrible for accountability, and terrible for fiscal responsibility. The ballooning number of earmarks and the "Bridge to Nowhere" killed the GOP brand. They were a perfect example about how the Republican party lost its roots and its soul. Campaigning on the elimination of all earmarks would be a great way to show the base that you are listening.

4) Small Government Means Local Government

It should be the Republican ideology that it is best when a problem is solved at the lowest possible level. It is better when a problem is solved within a family than within a neighborhood, or within a town, a county, a state, or finally, the federal government. The message is: "The Democrats want the federal government to run your elementary schools; the Republicans want your local PTA in charge." The stated goal should not be so much to cut government services but to decentralize them.

The flipside is that the Republican party needs to tolerate it when states do things the national party does not like. Injecting the federal government into the medical marijuana issue or the gay marriage debate undercuts the whole Republican philosophy. It should not be a battle about what the federal government allows you to do, but about what the federal government is allowed to do.

5) Return to Realism

The GOP needs to once again be the party of speaking the cold hard truth. John McCain is well positioned to help the party in this regard. From the Iraq War we learned that a lie repeated enough will be believed, but not forever. Lying about weapons of mass destruction, war progress, and the economy has destroyed the Republican brand and made it look like a party of crazy old kooks.

6) Get on Board with Universal Healthcare

John McCain's healthcare plan is simply horrible. It may sound nice on paper but in the long run it would be a disaster. It doesn't matter how many tax credits you give or how many companies are competing in the market. If you have been diagnosed with a costly lifelong condition no insurance company will cover it if they can choose not to.

Healthcare is becoming a huge issue and will continue to grow in importance as the economy softens and healthcare costs soar. The USA is the only first world country with out a universal system, but it pays more per person than any other. The current system has failed, and reform will happen. It is time for the GOP to get on board and help shape the reform or be crushed by it. Germany, Switzerland, and Japan all have good market based universal healthcare systems which the GOP can model and champion.

The Gas Tax is Great

John McCain's and Hillary Clinton's plan to suspend the gas tax has been called everything from a "political ploy" to the "dumbest thing ever." The only thing it has not been called is a good idea. Why? Because the gas tax is great. It is shocking to hear a Republican attack the best and fairest tax in the country.

The gas tax is used to pay for the building and upkeep of our nation's roads and highways. If you don't drive a car, you are not using our highways; therefore, you aren't made to pay for something you don't use. If you drive a lot, creating a lot of wear and tear on our roads, you are made to pay your fair share.

For years this is how Republicans have been telling us they want taxes to work. The gas tax is fair, because the amount you pay is based on the amount to use. The gas tax is universal; no one-- not even criminals, drug dealers, or tax dodgers-- can get out of paying the gas tax. The gas tax is good because it discourages you from doing something which is bad for the air we breathe and bad for our health. And finally, the gas tax is simple. You don't need some huge IRS bureaucracy to monitor the gas tax. Instead of talking about suspending the gas tax we should be talking about how to make all our taxes more like the gas tax.