Why Economic Populism Is a Losing Game for Republicans

It was probably inevitable that the right’s economic populism would degenerate into promises of more government checks. Early in the week, the administration floated the idea of redirecting federal childcare aid so low-income married stay-at-home parents could get a $9,000 subsidy per child for daycare.The policy, reportedly hatched by Vice President Vance, would use the Department of Health and Human Services’ Child Care and Development Fund, originally created in the 1990s for low-income single parents. Mr. Vance’s defenders stress that the program merely redirects “existing subsidies” and wouldn’t add to the debt.The notion that Mr. Vance was fiscally responsible was quickly shattered later in the week when he appeared on television defending President Trump’s promise to hand every adult a $5,000 “dividend” check should Republicans hold on to Congress.“We’re taking in an extraordinary amount of revenue,” Mr. Vance told Fox News’ Bret Baier. “What the president is saying is, ‘If you keep it going, if you keep us in power and allow us to continue to do these things, then you’re going to share in some of the benefit of this incredible wealth that we are creating in the United States of America.'”None of this is true.Import taxes on Americans don’t create any wealth — they extract it. The administration collected roughly $300 billion from American consumers through tariffs last year. The “revenue” was supposedly going to be used to pay down the debt. Handing out roughly $1.3 trillion to voters, while running an existing $2 trillion deficit, isn’t a “dividend” payment as much as a brazen socialistic redistribution stunt that would add $1 trillion to the deficit.Of course, the contention of the Senate minority leader, Chuck Schumer, that the proposal was an “insult” to voters and democracy itself is risible considering that socialistic redistribution is the foundation of the Democratic Party’s entire economic agenda these days. More than anything, Mr. Schumer was likely perturbed that Republicans were stealing the left’s strategy.And that’s the real problem. Republicans are altering the electorate’s expectations by conceding core arguments to the left. Mr. Vance’s fans argue that welfare programs will never be unwound, so they might as well be used for social conservative goals. Once you normalize arguments in favor of dependency, politics devolves into an arms race in who can send voters bigger checks.Mr. Vance’s defenders present themselves as champions of stay-at-home mothers and his critics as anti-family, Chamber-of-commerce types, who want to push mothers into the workforce to lift the GDP and destroy nuclear families. That’s not the choice.The preexisting program, the CCDF, funds day care facilities so that already poor single mothers, some of whom have been abandoned or widowed, can go to work and hopefully become self-sufficient. The program was meant to wean people off dependency.Since the Great Society was hatched, conservatives have argued that welfare throws people into a corrosive generational spiral.Now, you can argue that the CCDF failed at its intended goal, but Mr. Vance’s plan hooks an entire new group, low-income married mothers, on state funding and incentivizes breadwinners to stay poor enough not to lose the subsidy.There would be a good chance the idea ends up hooking others. Every welfare program that has ever existed is prone to grow bigger. There are many more poor married couples with children than single mothers. The eligibility pool will be far larger. The demand will be far greater. Some fans of the program are already arguing to expand it.The funding for safety net programs is diverted from middle-class families, who don’t always have the luxury of a spouse staying home with the children, either. At some point, they’ll say, “What about us?” What will populists tell them?And, judging from the wide range of progressive leftist economics embraced by Mr. Vance and other economic statists, this might well be the goal. In essence, the argument is that the welfare state can do good things if only it were deployed for the right reasons by the right people.There is little evidence for this, either. Countries such as Hungary have spent chunks of their GDP enticing people to form families, including tax exemptions, cash handouts to mothers, and subsidized loans. This wasn’t even aimed at the poor, but at everyone. After a small initial bump in replacement rate, Hungary’s fell to an all-time low.Mr. Trump’s $5,000 check is a gimmick, of course. Yet Mr. Vance’s central economic goal is to move the Republican Party away from Reaganism and toward right-progressivism.Modern Republicans are increasingly embracing economic demagoguery and doomerism. In the end, though, they will never be able to outspend or outpromise the left.The right-populists’ mantra seems to be “fund the family,” when it should be “free the family.”Creators.com

Why Economic Populism Is a Losing Game for Republicans

Why Economic Populism Is a Losing Game for Republicans

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