“'Compassionate' Conservatism Was a Mistake ”

Author: Dick Armey

The liberal pundits who embraced the candidacy of Barack Obama are also eager to issue a death certificate for free market capitalism. They’re wrong, and they remind me of what the great Willie Nelson once said: “I’m ragged but I’m right.”

To be sure, the American people have handed power over to the Democrats. But today there is a categorical difference between what Republicans stand for and the principles of individual freedom. Parties are all about getting people elected to political office; and the practice of politics too often takes the form of professional juvenile delinquency: short-sighted and self-centered.

This was certainly true of the Bush presidency. Too often the policy agenda was determined by short-sighted political considerations and an abiding fear that the public simply would not understand limited government and expanded individual freedoms. How else do we explain “compassionate conservatism,” No Child Left Behind, the Medicare drug benefit and the most dramatic growth in federal spending since LBJ’s Great Society?

John McCain has long suffered from philosophical confusions about free markets, and his presidential campaign reflected as much. Most striking was his inability to explain his own health-care proposal, or to defend his tax cuts and tax reform. Ultimately, it took a plumber from Ohio to identify the real nature of Barack Obama’s plan to “spread the wealth.”

Mr. McCain did find his message on taxes in the last few weeks, but it was too late. A Rasmussen poll of Oct. 30 reported that 31 percent of likely voters believed that “taxes will go down” under an Obama administration versus just 11 percent under a McCain administration. Shockingly, 19 percent of self-described conservatives believed Mr. Obama would cut taxes; only 12 percent thought Mr. McCain would.

The response by Mr. McCain to the financial crisis on Wall Street was the defining moment of the campaign. In what looked like a tailor-made opportunity to “clean up Washington,” the Republican nominee could have challenged the increasingly politicized nature of Federal Reserve policies, and the inherently corrupt relationships between Fannie Mae, Freddie Mac and various Democratic committee chairmen. Instead, his reaction was visceral and insecure: He “suspended” his campaign and promised “to put an end to the reckless conduct, corruption, and unbridled greed that have caused a crisis on Wall Street.”

In the process, he squandered his political standing with the investor class, a core Republican voting bloc. An October 26-30 Reuters/C-Span/Zogby poll of likely voters showed Mr. McCain barely beating the Democratic nominee among self-identified “investors,” 50.4 percent to 43.8 percent — a dramatic drop from the 15-point lead he held in a similar poll a month earlier.

The modern Republican Party has risen above its insecurities to achieve political success. Ronald Reagan, for example, held an unshakably positive vision of American capitalism. He didn’t feel a need to qualify the meaning of his conservatism. He understood that big government was cruel and uncaring of individual aspirations. Small government conservatism was, by definition, compassionate — offering every American a way up to self-determination and economic prosperity.

Republicans lost control of Congress in 2006 because voters no longer saw Republicans as the party of limited government. They have since rejected virtually every opportunity to recapture this identity. But their failure to do so must not be misconstrued as a rejection of principles of individual liberty by the American people. The evidence suggests we are still a nation of pocketbook conservatives most happy when government has enough respect to leave us alone and to mind its own business. The worrisome question is whether either political party understands this.

What will be the fate of free market capitalism in America? Will the 2008 election look more like 1932 — or 1992?

On both occasions, Republican presidents had abandoned their party’s principles for bigger government policies that exacerbated difficult economic times. On both occasions, Democrats took control, largely hijacking the small-government, fiscally responsible rhetoric of their opponents. Of course, FDR’s election ushered in the New Deal, the most dramatic expansion of government power in American history, together with policy changes and economic uncertainty that inhibited investment and growth and locked in massive unemployment for nearly a generation.

The official agenda of the incoming administration is not so different from FDR’s. Whatever doubts remain about Mr. Obama’s governing principles can be cleared up by looking at the governing philosophy of the Democrats in Congress he will be crafting legislation with or the liberal constituencies he is indebted to support. Democrats will not be ambiguous. They have every right to be energized, and will attempt sweeping changes to our economy and the very nature of the relationship between individual American citizens and the federal government.

Their wish list is long. Charlie Rangel, chairman of the House Ways and Means Committee, has said he would like to redistribute a trillion dollars through the tax code, including massive tax hikes on capital accumulation and individual entrepreneurship. Labor unions want to take away the right of a worker to a secret ballot in organizing elections. Radical environmentalists demand strict curbs on energy production and use. Hillary Clinton may have lost the primary, but expect Democrats to push her favorite idea: government-run heath care.

Will Democratic overreach give the small-government movement the opportunity to reassert itself in the GOP? Former Congressman Dick Gephardt has warned President-elect Obama and the new Democratic majorities to be humble and measured. But with a legislative agenda driven by Nancy Pelosi, George Miller and Mr. Rangel, the temptations may be too great.

In 1992, Republican backbenchers including Newt Gingrich, myself, Bob Walker and John Boehner rose up to challenge the Clinton administration’s agenda on taxes, spending and government-run health care. But before we could beat the Democrats, we had to beat the old bulls of our own party who had forgotten their principles and had become very comfortable as a complacent minority. We captured control of Congress in 1994 because we had confidence in our principles, and in the American people’s willingness to understand and reward a national vision based on lower taxes, less government and more freedom.

That can happen again today — but it will require a new generation of leadership, the sooner the better. Rest assured that the American people will show up for the fight.

Mr. Armey, U.S. House majority leader from 1995 to 2002, is chairman of FreedomWorks Foundation.