The Corner

Dependency and the Threat to the GOP: Why We Need a Great Leader

One of the issues that the NRI summit has tackled is whether the Republican party is actuarially doomed by the disproportionate growth of ethnic groups that tend to vote Democrat. For many, that question boils down to what conservatives can do to appeal more to Hispanics. I agree that the GOP needs to lose its reputation for intolerance — and fast. But the real demographic challenge to conservatism is deeper and more difficult, and it has nothing to do with ethnicity.

In a properly functioning two-party system, power oscillates between the parties, because each party claws towards the middle and competes to offer the other side’s wavering constituents something they’re not getting now. This regular oscillation of power can get jammed, however, when one party manages to turn government into a machinery of extraction for its supporters. This partly explains the Democratic party’s 40-year lock on the House of Representatives.

The danger of a new Democratic lock on some part of the federal government now looms larger than ever. The reason is that, contrary to what President Obama claimed in his second inaugural, we have become a nation of takers. As my friend Nicholas Eberstadt wrote recently in the Wall Street Journal,  “According to the latest data from the U.S. Census Bureau, nearly half (49%) of Americans today live in homes receiving one or more government transfer benefits.” That’s basically twice what it was in the early 1980s.

What that means is that we are witnessing a sweeping transformation of American society, from one based on opportunity to one based on dependency. The major new entitlement benefit of Obama’s presidency — Obamacare — will dramatically increase the proportion of American households receiving government transfer benefits. The law provides Medicaid benefits or insurance premium subsidies for all Americans up to 400 percent of the Federal Poverty Level —  virtually two-thirds of American society.#more#

We have not even seen the start of the impact this expansion of the entitlement state could have on our electoral politics.

The prospect of a lasting Democratic majority, based upon a vast coalition of takers, is real. But it need not come to fruition, and if it does come to fruition, it need not last. The reason is that, contrary to what President Obama and his supporters evidently believe, more dependency necessarily entails less opportunity. This is because wealth can only be created through the efficient allocation of human and material resources, a process that can only occur in the private economy. The larger the share of the economy dominated by the public sector, the less economic growth there will be. Hence, the administration’s policies are certainly diminishing the possibility of economic growth — something that would be a lot more obvious already if it were not for the huge windfall our economy has found in the current boom in oil and gas production.

The near-certainty of lasting economic malaise if this administration’s policies become entrenched is the ultimate time-limit on those policies — and on the Democrats new coalition of takers. Sooner or later Americans will become so miserable that they will become desperate for change. That is what happened to the British just before Thatcher’s revolution.

But it must remain our goal to keep that from happening, otherwise we could see a lost generation. The only way to preserve the promise of opportunity in America, and protect the GOP’s political prospects, is to end a substantial part of the dependency state. That means taking away many or most of the entitlement benefits that Americans enjoy nowadays. To the extent you end entitlements you take away the constituency for them — that is a deeper lesson of the Clinton-era welfare reforms.

Will that be difficult? History suggests that nothing is more difficult than for a society to reverse the factors of its own decline. History also shows that where a nation has been able to do that, a transformative leader has been an indispensable part of the mix.

The model here may not be Reagan, who was only facing a few years of stagflation. The model may be a leader such as Margaret Thatcher and Charles de Gaulle, each of whom was able to reverse a national decline that was already well under way, and which had come to seem irreversible.  

If conservatives are to meet the challenge that the dependency state poses to their political prospects, the first step is to find a leader who can unite the country behind a mission of national renewal. 

Mario Loyola — Contributing editor Mario Loyola is senior fellow and Director of the Center for Competitive Federalism at the Wisconsin Institute for Law and Liberty. He began his career in corporate ...

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