There are things that the next president should do, and things the next president could do, some of which could be done by either Hillary Rodham Clinton or Donald Trump but which neither would be very much inclined to do well. If the next president is wise (I know, I know), then he or she will set aside the frothier emotional currents of the immediate post-election period and put a few important things in the hands of intelligent advisers.
I see four important coulds/shoulds. At one a year, this should hold us over until the Ben Sasse administration.
First is a definite should: corporate tax reform. The United States has the highest on-paper corporate tax rate in the developed world but effective tax rates on the lower side. The distance between the nominal rate and the effective rate is one pretty good measure of crony capitalism as businesses take advantage of a raft of carve-outs, exemptions, and deductions targeted at politically connected industries and firms. These are not “loopholes” — they are the tax code.
While it may not be politically appetizing to put it this way, the best solution to tax competition from overseas tax havens such as Ireland and Switzerland is to be the tax haven, and the way there is to have a low and stable rate and few if any special-interest handouts.
Even better, we could simply tax income when it hits somebody’s bank account (through salary, bonuses, dividends, capital gains, profit-sharing, etc.) and do away with the corporate-income tax altogether, capturing the same tax revenue (it is only about 10 percent of all federal income) on the individual side. Eliminating the corporate income tax entirely while still capturing the revenue as individual income tax would allow the federal government to keep the same level of revenue while saving businesses billions of dollars in tax-compliance costs and eliminating countless opportunities for rent-seeking and influence-peddling.
Second: I do not expect this to be the case, but if the man who likes to call himself Mr. Brexit (someone explained to him what Brexit is) should become president, then he might consider pursuing a free-trade pact with the United Kingdom, which is on its way out of the European Union. Indeed, Donald Trump has said he favors bilateral trade deals to multilateral accords, and one suspects that trade with our British cousins is an easier sell politically to many Americans than is trade with East Asia or Latin America. A newly liberated United Kingdom will be looking for expanded trade opportunities, and we already have a very rich and mutually beneficial trading relationship with the British. Free trade is good for many reasons, and free trade with people who share our language, cultural roots, and legal foundations — and who have been our most reliable allies — is deeply desirable. The United States and United Kingdom already are the largest foreign investors in each other’s economies to the tune of more than $1 trillion in total.
Third: Hillary Rodham Clinton has rather different ideas about immigration reform than does Donald Trump, but some of her most energetic and important supporters — the members of American labor unions — do not. When I was reporting on Senator Bernie Sanders’s campaign, the remarkable (hysterical, in fact) hostility toward immigrants on the part of the audiences coming out to support the Vermont socialist as he visited Iowa union halls made an impression on me. The “Build a wall and make Mexico pay for it!” nonsense is doomed to run into various geographical and political realities, but this is a country that wants something done about illegal immigration — and done yesterday — while support for restrictive reform of the legal immigration system is strong, too. The potential compromise I have described pairs strong enforcement (both at entry points and, especially, at the work place) with a reform of the legal-immigration system that replaces the family-unification chain-immigration model with one oriented toward easing the way for highly skilled, high-income, and high-net-worth immigrants, and that ought to appeal to reasonable people in both parties. There aren’t very many of those, but perhaps the ones who remain could persuade the president, whomever that ends up being.
Fourth: Most Americans who are neither lobbyists for transnational firms, public wards, nor career criminals interact more with their local governments than with the federal government. Beyond pothole-filling and speed traps, the main locus of that interaction is the public school. Americans will go to great lengths to ensure that their children go to the best schools they can: In Philadelphia, the excellent suburban schools often find themselves educating city students who take up theoretical residence with a great aunt in Montgomery or Delaware County to escape the failed city schools. Mrs. Clinton’s big idea on education reform so far has been shunting vast streams of money to the unionized teachers who will do their best to put her in the White House, but, at some level, she probably knows better. Barack Obama knows better: As a candidate, he told a room full of Wall Street supporters (this according to a source present at the meeting) that he was very close to breaking ranks on the question of school choice, because he was fed up with the low standards and lack of accountability of the big-city public schools. He never had the guts to do it. Perhaps his successor will.
The federal government already has too strong a hand in the public schools, which are rightly a local concern. But it does have that hand, and a lot of funding to spread around, too, which means that it can demand reforms. Rather than trying to manage the schools from Washington with the usual uniform-standards agenda, Washington could ease back on the micromanagement and, through insisting on real school choice, delegate that micromanagement to the parents and local communities who have the knowledge and the incentive to do that job well. School districts could receive the same amount of financial support — or more, for that matter — but it would be used in a way that uses choice to enforce accountability.
People say they want pragmatic, commonsense reforms. They don’t, really: They want to punish and humiliate their enemies and reward their friends and themselves with government largesse. But there are things that the next president could do that both conservatives and people who do not have Milton Friedman quotations hanging in cross-stitch samplers on their walls could support. There is no conservative in the presidential race, which means that no matter who wins tomorrow, conservatives will have to persuade the next president to see the value in our proposals over his or her own instinctive preferences. It will not be easy, but there isn’t really another choice other than surrender and political quietism.