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The public policy blog of the American Enterprise Institute
How would a 21st century American president deal with America’s 21st century economic problems?
More than a decade in, we really don’t know. The Bush administration was consumed, by necessity, with war. The Obama administration, by choice, with preserving the FDR-LBJ welfare state and adding a key missing component: nationalized healthcare. Obamanomics has been an expensive effort in economic nostalgia to recreate the supposedly prosperous, egalitarian 1950s. The Obamacrat obsession with bullet trains, the latest in 1960s transportation thinking, is illustrative and telling.
And not that the left doesn’t know where it wants to next take America. It has a big, if unoriginal, idea: a vastly more expansive and intrusive welfare state, universal in nature, financed through higher taxes on the rich, business, and eventually middle-class through a value-added tax. If it’s good enough for Scandinavia, it’s good enough for Obama’s America.
But the right has also been backward-looking. Forget about Reagan reminiscing. Some conservatives and libertarians are yearning for a leader who can be a bridge back to the 1920s, the pre-New Deal, pre-Keynes era of Calvin Coolidge. Low marginal tax rates, balanced budgets, and hard money are touted as macropolicies of such obvious intrinsic merit that justifying how they broadly enhance prosperity and meet current challenges is an afterthought. Too often the GOP settles for cruising high at 35,000 feet, its big-picture ideas far removed from the messy, everyday problems currently afflicting flyover America.
Marco Rubio is one of the few national Republicans, Mike Lee is another, offering a path out of that ideological cul-de-sac. Not by abandoning conservative principles — but by applying them in a modern, relevant way. Rubio’s big economic speech last week tied together several earlier speeches outlining new approaches to reforming key American institutions such as higher education and the welfare state and addressing problems such as wage stagnation and retirement security in a historic time of globalization and automation. As Rubio put it:
We Americans have good reason to be hopeful, for no nation is better positioned to access the full promise of the 21st-century economy. The new economy is all about innovation, creativity and productivity – and we are the most innovative, creative and productive people on the planet.
And the changes we must make to achieve this better future come
from fundamental truths about our nation: that government exists to empower its people, and that our free enterprise economy is the greatest generator of opportunity and prosperity in human history.
From these principles we see that if we reform our taxes and regulations, we can create millions of higher paying jobs by winning the global competition for talent, investment, and innovation.
And if we modernize our outdated safety net programs and revolutionize how we acquire and pay for education, millions of people will have the skills they need for the higher paying jobs of the new economy.
20th-century America was special. But 21st-century America has the potential to be even better.
Rubio might run for president. But even if he does not, he is methodically assembling a bold, smart agenda for any reform-minded national candidate wishing to move forward both America and the Republican Party.
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