This should prove to be an ideological election about the economy. Not all campaigns are so clear-cut. Sometimes moderate Republicans raise taxes (as George H. W. Bush did); at other times, pragmatic Democrats cut spending (as Bill Clinton did).
But this year, Mitt Romney, the likely Republican nominee, will run an ideological campaign, calling for smaller government and lower taxes, against an equally ideological President Obama, who wants more government and higher taxes. In this divided red-state/blue-state era, the supporters of each candidate demand no less and will have a clear choice.
This year’s campaign sloganeering will remind us of all the classic American arguments: Was it New Deal big government or World War II–inspired entrepreneurialism that truly ended the Great Depression? Were we better off under Ronald Reagan’s or Bill Clinton’s economic policies? Was it unfettered Wall Street greed or Freddie Mac and Fannie Mae government corruption that caused the 2008 financial meltdown? And which model has better served its people: America’s or the European Union’s?
Romney will make the implicit case that his prior success in the private sector and his free-enterprise know-how will bring Americans more personal freedom and prosperity — even if the upsurge may result in more inequality.
If we simplify or cut tax rates, slash federal spending, pay down the debt, prune away regulations, and push ahead with far more fossil-fuel development, Romney will argue, then employment will improve and those with money now who are on the sidelines will get back into the game. The economy will expand, more wealth will circulate, and greater revenue from taxes will be collected. Whether someone ends up with more money than someone else won’t be as important as the fact that those in the middle and on the bottom will be better off than they are now.
President Obama will decry “trickle-down economics” and counter with an appeal to equality. He revealed his own views about fairness in April 2008. When asked about raising the tax rates on capital gains, Senator Obama replied that he would indeed raise taxes for “purposes of fairness” alone — even if such hikes led to less aggregate revenue for all.
In the last three years, Obama has made it clear exactly what he meant. Almost half of Americans pay no income taxes, and more people than ever are on food stamps. Government is larger than ever, and more rules regulate business. The president pushed through a takeover of health care that may prove to be the greatest federal entitlement since Social Security. He has borrowed $5 trillion in less than four years in an effort to fund more social services — a gargantuan debt that he believes will require more taxes on the top brackets to pay back.