Ramesh Ponnuru offers one of the very best takes on the 2012 elections. First, Ponnuru argues, the GOP isn’t as a healthy as some Republicans still believe it to be. He points out that a) the party was a drag on Mitt Romney, evidenced by his outperformance of most GOP senate candidates; b) Republicans narrowly lost the popular vote for the House; c) while the party holds 30 of 50 state governorships, each “was elected either in a state Romney carried or in the unusually Republican years of 2009 and 2010 — or, in most cases, both;” and d) even when Republicans hold congressional majorities, they pale versus Democratic majorities.
But those are just symptoms of a deeper problem, Ponnuru concludes, which is that the party doesn’t not have a meaningful domestic policy message for middle-income Americans:
The absence of a middle-class message was the biggest failure of the Romney campaign … To put it differently: The problem isn’t so much that Romney was vulnerable to a set of attacks that appear to have discouraged working-class whites from voting; it’s that he didn’t have anything positive with which to counter those attacks.
The Republican story about how societies prosper — not just the Romney story — dwelt on the heroic entrepreneur stifled by taxes and regulations: an important story with which most people do not identify. The ordinary person does not see himself as a great innovator. He, or she, is trying to make a living and support or maybe start a family. A conservative reform of our health-care system and tax code, among other institutions, might help with these goals. About this person, however, Republicans have had little to say.
If Republicans found a way to apply conservative principles in ways that offered tangible benefits to most voters and then talked about this agenda in those terms, they would improve their standing among all of these groups while also increasing their appeal to white working-class voters. … It is certainly a country that has strong conservative impulses: skepticism of government, respect for religion, concern for the family. What the country does not have is a center-right party that explains how to act on these impulses to improve the national condition. Until it does, it won’t have a center-right political majority either.
I couldn’t agree more. While Romney often talked, for instance, about increasing “take-home pay,” he was never specific since his tax-cut plan was supposedly “revenue neutral” in that it mostly balanced off lower tax rates with fewer (unspecified) tax breaks. That’s why there wasn’t a simple “tax-cut calculator” on the Romney web site. For many Americans, there was a good chance the Romney tax cut plan would have made minimal immediate difference in their take-home pay. And when half the country isn’t paying income tax, cutting the income tax loses its political potency.
When tax rates were high across income levels, calling for across-the-board tax cuts was policy enough for conservatives and Republicans. Now a more full-spectrum approach is called for: Business tax reform to boost growth, improve international competitiveness, and reduce crony capitalism; a natural-gas driven energy policy combined with more energy science funding; consumer-driven healthcare reform. A pro-growth domestic policy agenda, but also one that is pro-family. As economist Robert Stein has suggested:
There are, of course, already some modest tax benefits attached to having children. Combining the impact of the $1,000 per-child tax credit with 15% of this year’s dependent exemption of $3,650 (15% being the income-tax rate paid by most middle-class parents), it turns out that having a child today reduces the typical household’s annual tax burden by a total of about $1,550. But considering both the cost and the value of raising children, $1,550 is much too low.
To correct for this inadequate treatment of households with children, the existing dependent exemption for children, the child credit, the child-care credit, and the adoption credit should be replaced with one new $4,000 credit per child that can be used to offset both income and payroll taxes.
The new child credit would accomplish several significant policy goals. First, it would offset the anti-parenting bias created by Social Security and Medicare. Second, the credit would help simplify the tax code by getting rid of other exemptions and credits that apply to children. Third, and very important for many families, it would end the bias against families with a stay-at-home parent now caused by the child-care credit (which applies only if both parents are working for pay). And finally, it would reduce effective marginal tax rates for many middle-class families.
So who will be the first 2016er to jump on board?