We go forth to the people with ideas and programs for the future that are as powerful and compelling as they are fresh. -- Republican platform, July 1980
DEMOCRATIC SEN. Daniel Patrick Moynihan is saying it, and so is The Wall Street Journal. The Heritage Foundation believes it, as does the Republican platform and even disinterested commentators. The GOP has become the "party of ideas," with a new vision for a new decade.
I hope it does not seem ungracious, as President-elect Reagan takes his "victory lap" around the capital, to ask what are these new ideas that animated Republican candidates and that presumably will dominate the new government. Along with the rest of the nation, we Democrats who lost -- and who surely did not offer many new ideas -- have a large stake in discovering the answer.
We might look, then, at seven of the prominent GOP ideas that seemed to recur throughout the presidential campaign. Are they, even discounting the predictable hyperbole of a party's platform, "fresh" and "compelling" and "powerful"?
1. Cut Taxes -- a Lot . A substantial tax cut was the undisputed centerpiece of the 1980 Republican platform. The now familiar argument is not very complicated: Productivity requires investment; investment requires savings; we save too little because the government takes too much in taxes. The suggested solution, as economist Arthur Laffer sketched it on a napkin in a Washington restaurant, is to have the government tax less and yet generate more federal revenue.
Taxes, of course, have never been very popular; they had something to do with the American Revolution. But, as Laffer's supporters eagerly point out, a tax cut to spur economic growth is surely not a "new idea." President Kennedy successfully pulled off that one. Walter Heller, who was chairman of JFK's Council of Economic Advisers, was supposedly Laffer without the napkin -- though Heller disowns paternity for today's version. The Kennedy cuts not only were far slimmer than Laffer's and Reagan's, but they were undertaken when inflation was 1.6 percent (1961-65), not today's 12.7 percent.
This GOP "supply-side" economics of Laffer, Rep. Jack Kemp and others also sounds suspiciously similar to the old Republican "trickle-down" concept: Give more money to the rich and they'll invest it so as to produce jobs and wealth for the non-rich. An early "supply-sider," for example, was Andrew Mellon, who in a more candid era said that "the prosperity of the middle class depends on the good fortune and light taxes of the rich."
Will this notion work today? Laffer himself is not entirely reassuring. "There's more than a reasonable probability that I'm wrong," he told Newsweek, "but . . . why not try something new?" We are likely to find out soon whether this old concept in new clothing and in an inflationary era is an idea whose time has come again economically as well as politically..
2. Balance the Federal Budget . Few refrains are more repeated by President-elect Reagan and other Republicans than that "government deficits cause inflation." The GOP's dedication to the balanced-budget principle today, however, cannot exceed that of Herbert Hoover and Franklin Delano Roosevelt Jr., both of whom advocated it in their 1932 race, and of Jimmy Carter, who preached it in 1976.
Though few doubt that a balanced federal budget is desirable (the combined local, state and federal budget in this country is already roughly in balance), not many economists other than strict monetarists would argue that it is essential to stop inflation. We have, after all, had deficits with reduced inflation in the past. In 1975-76, for example, the inflation rate fell from 12 percent to 4.8 percent, though the combined deficit for the two years reached $112 billion.
Moreover, as the Congressional Budget Office estimated last year, the substantial budget cuts proposed by the Carter administration for fiscal 1980 would have reduced the inflation rate by a mere tenth of 1 percent. If this idea, then, is not "fresh," it is also hard to see how it is "compelling," to say nothing of how it specifically would be done. The chief Reagan "idea" repeatedly has been to cut "government waste and extravagance," a standard statement of almost everybody who has ever run for political office. We can only wish him well.
3. Reduce Regulation. This idea is to Republican candidates what tanks were to Patton. Ever since the 1906 Pure Food Act was passed following Upton Sinclair's "The Jungle," businessmen and Republicans have been inveighing against government regulation in the marketplace.
Indeed, Ronald Reagan made his political name in the 1950s and 1960s with his colorful attacks on Big Government (always capitalized). In the 1950s this evil was referred to as "creeping socialism." cThough the phrase has aged poorly, the concept endures. The Reagan version today is that we must "get the government off our back."
To be sure, much regulation is wasteful, as the departing Congress clearly realized. Already there has been substantial deregulation in such industries as air travel, trucking, banking and communications. Though Reagan also has talked much about "letting the energy companies loose," it has been the Carter administration and a Democratic Congress that already have begun to decontrol energy prices.
At the same time, much health and safety regulation saves lives and dollars.
There will long be disputes over which are which, and the question is whose lives and whose dollars the Republicans are willing to put more at risk. But any suggestion that reducing regulation of business or others is a "fresh idea" -- giving more program control back to state and local governments is, of course, a well-worn Nixon theme -- is not terribly persuasive.
4. Stand Up to the Russians . Republicans repeatedly argued that we've been so weak internationally as to tempt or provoke Soviet aggression. It is difficult to portray this as an "idea," much less an original one.
This country has been preoccupied with being tough with the Russians from the communist regime's year of birth, when Woodrow Wilson sent 7,000 American soldiers to Soviet ports in the Arctic to join British and French troops battling the Bolsheviks.
At the time of the 1948 Berlin airlift, Defense Secretary James Forrestal and Air Force Secretary Stuart Symington spoke privately to other officials about the desirability of preemptive atomic strikes against the Soviet Union. Now that's talking tough.
Clearly, in the end the Reagan administration will have no rational alternative to pursuing "peaceful coexistence" or "detente" or whatever the future phrase is for comity short of war.
5. Dramatically Increase Military Spending . One way to stand up to the Russians, the Republicans have suggested, is to fatten the military budget and even seek "military superiority." If this means a heightened arms race, so be it. It scarcely needs to be said that large military budgets and an arms race are not ideas invented in the 1980 presidential campaign. It must acknowledge, though, that the 13 to 21 percent increase in military spending now under consideration in Congress would be the largest annual increase in any year since the Korean War.
6. Freeze Hiring by Washington . This was the first program suggestion in Ronald Reagan's GOP acceptance speech and in his maiden pronouncement as President-elect. Such a move would be decisive, to be sure, but hardly unprecedented. President Carter has instituted three hiring freezes; the last one, in mid-1980, eliminated 20,000 federal jobs by permitting only one new person to be hired for every two who left.
Total federal hiring freezes usually are short-lived, according to civil service head Alan Campbell, because any administration would want to replace retiring air comptrollers or people who disburse Social Security checks, not to mention the person who runs the elevator at the Washington Monument. In any case, federal employment totals have remained essentially unchanged for many a year. On the other hand, the big new hiring has been done by those state and local governments that President-elect Reagan sees as the answer to many problems.
7. Encourage "Enterprise Zones" in the Cities. Under a proposal sponsored by New York Reps. Kemp and Robert Garcia, small businesses would qualify for significant tax breaks if they did business in areas of high unemployment and significant poverty.
This is an attractive idea but certainly not a "new" one. An earlier version appeared in President Kennedy's 1961 Area Redevelopment Act. President Carter's 1978 urban package also proposed tax incentives to encourage industry to locate in depressed areas. This issue has long been settled in Europe, where the nine Common Market countries spend an estimated $17 billion a year on similar incentives. "Taking the work to the workers" is how it is described in some European cities.
These widely discussed ideas are only some of the bigger boulders in a Republican avalanche falling on Washington these days. Prospective chairmen of the nascent Republican Senate have also suggested such "new" ideas as reinstituting the death penalty, allowing prayers in schools, applying antitrust laws to labor and barring Justice Department involvement in cases requiring busing for school desegregation. Indeed, the Heritage Foundation, in its 3,000-page report "to show that conservatives do have new ideas," including a proposal to ressurect the House Un-American Activities Committee.
Taken together, these and other proposals obviously are not new ideas. They are merely old wine in new bottles. The Republicans simply appear determined to return to some status quote ante when there were low taxes, a balanced budget and less regulation. In other words, they may have one great new idea -- that the future is the past.
But the past did not have an Opec, Third World nations with plutonium, multinational corporations larger than nations, severe resource shortages and other complications and frustrations of today. Ronald Reagan and a new generation of Senate Republicans may have been elected advocating old verities. But it is difficult to see how, as some have suggested, this is the basis for a fundamental transformation in American politics. We will have to see what happens when the ceremonial cheering stops.