Magazine | December 17, 2018, Issue

The Populism Trump Needs

(Nicholas Kamm/AFP/Getty Images)
Six ideas

Donald Trump has lost his Republican Congress and must now come up with an agenda that saves his presidency and preserves the Republican party from a potential disaster in 2020.

The danger for the Trump presidency, one that the president obviously senses and fears, is that the second half of his first term will become completely mired in legal fights, assertions of executive privilege, and rearguard actions against a Democratic House majority that is baying for blood. He may not be able to avoid that battle, but he can pick another, more propitious fight at the same time. Freed from the Paul Ryan House majority and its legacy-Republican policy goals, the president should pursue an openly populist agenda.

What did we learn from the 2018 election? The Republican party continues to move down-market. In 2016 Trump lost white voters with household incomes over $200,000. At every step downward in income from there, Trump increased his vote-getting power. Republicans running in Congress do not significantly reverse the trend. They lost 42 of the 50 richest congressional districts in November.

The first two years of the Trump administration did not convince the Rust Belt areas that narrowly elected Trump president to support his Congress. This is a key constituency for the Trump coalition. Timothy P. Carney has shown that Donald Trump got half a million votes from union households in Michigan, compared with Romney’s 430,000 four years earlier. Trump won Michigan by 12,000 votes. But outside of Ohio, working-class white voters in the Rust Belt snapped back to supporting Democrats in 2018.

Republicans held on to the Senate, where they had just completed a gruesome fight for the Supreme Court confirmation of Brett Kavanaugh. That fight united Republicans. But Re­publican candidates were beaten badly in the House, where the conflict between some of the party’s long-held principles and political reality ran hottest. Republicans had promised to repeal Obamacare. Doing so in any meaningful way would have meant another dramatic round of policy cancellations that made voters anxious and put them in a vengeful mood. It was abandoned.

Republicans must allow themselves to see how voters are making the previous images of their party defunct. They got trounced in Orange County, the home base of Reaganism. Outside of the energy and weapons industries, Democrats are the party of the corporate elite. The Democratic party has become the party of America’s most unequal cities and its most unequal states. Republicans are the party that carries within itself the memory of America’s middle-class society, and they perform best wherever it is affordable for working people to form families. A Republican party that builds on this insight will win.

I have several suggestions toward that end, but first, a word of warning. Conservatives are not the only constituency of the Republican party. Some of the following ideas break frankly with the traditional Republican and conservative formulas that existed for a different electoral coalition in a different set of circumstances. If you want a Republican party that will protect the constitutional order, appoint originalist judges, and honor the liberties of America’s churches, synagogues, and other religious institutions, you need a Republican party that can win. And that means a Republican party that responds to its constituents’ demands.

1. Revive family-friendly tax and economic reform. The last Republican Congress managed to pass a broadly unpopular tax cut. Think about what a feat that is. There was a perfectly rational case for lowering America’s corporate tax rate, and there have been some initial positive effects from doing so. However, politically speaking, the tax cut was malpractice. Trump’s appeal was partly in being seen as a class traitor, someone detested by the rich people he knew and did business with previously. The corporate tax cut opens Trump up to a future opponent’s charge of breaking his promise to fight for American workers and instead enriching corporate boards that engaged in stock buybacks rather than business expansion.

Trump should turn to Republican senators, such as Mike Lee and Marco Rubio, who have tried to make creative family-friendly adjustments to the tax code. Expand and modernize the earned-income tax credit and the child tax credit. Bring back Ivanka Trump and hammer out a form of paid parental leave that Republicans can support. At the deepest level, anxiety about the future is tied to the very real recognition in low-fertility societies that there is underinvestment in human posterity. Government can’t solve that entirely, but it can work around the edges and acknowledge it.

2. Turn Mexico into a wall. Trump’s signature campaign issue was immigration. Ameri­cans detest the sense of lawlessness and disorder created by having millions of illegal immigrants residing and working in the country. As Zach Goldberg has demonstrated using data from the American National Election Studies, Trump voters’ anti-immigration attitudes were informed by demands for assimilation and fears of immigration’s impact on labor markets, and do not correlate strongly with feelings of a besieged “white identity.” Trump’s mostly symbolic executive orders have done little to address the real concerns motivating his voters. He cannot go into 2020 without at least attempting a major legislative push.

Trump and the Republican Senate should promote a packaged immigration reform: the implementation of E-Verify at workplaces, a skills-based legal-immigration system, reduction of overall immigration levels, and border enforcement in exchange for amnestying the “Dreamers” (illegal immigrants who came as minors) to bring along reluctant Democrats. The twin purposes of this legislation will be to create one lawful labor market in the United States and to allow America to assimilate the long great wave of immigration that began in 1965.

Democrats in the House will likely oppose this. And in the fight, elite Democrats must be shown to favor neglecting our laws because their personal economic interest is tied to an expanding class of workers who do not have the protection of the law. Republican America still values household self-sufficiency; it is the Democratic parts of America that have revived racialized classes of domestic help and endless new categories of service workers.

Finally, just as only Nixon could go to China, perhaps only Trump can go to Mexico City. Incoming Mexican president Andrés Manuel López Obrador has an interest in preventing further Central American “caravans” from making his country an on-ramp to the United States. Mexicans in Tijuana showed that popular resentment against uncontrolled migration is common in Mexico as well. The political benefit of striking up an unlikely partnership should be obvious to both leaders. Trump’s campaign promise to make Mexico pay for the wall was fanciful, but it can be kept by making Mexico into the wall.

3. Sell the trade war. Donald Trump needs to talk up the initial successes of his trade war with China. In a new paper, Benedikt Zoller-Rydzek and Gabriel Felbermayr conclude that Trump’s tariffs are doing exactly what he promised. The approach of Trump’s economic team, particularly Commerce Secretary Wilbur Ross, has been to place tariffs on Chinese goods where substitute goods are easy to find on the market. Exporters are responding by cutting selling prices to keep their customers. The bilateral trade deficit is set to drop by 17 percent.

True, these accomplishments have not been without costs. U.S. soybean producers have been badly damaged. Steel-using industries have also suffered. Trump must explain to the public the greater good of repairing and rebalancing the U.S. trade portfolio.

4. Take the conflict with China to Silicon Valley. Trump’s fixation on the media and instinctive rebellion against “rip-offs” have led him to focus his rhetorical fire on Jeff Bezos, the richest man in the world, the founder of Amazon, and the owner of the Washington Post. Trump could make a case that Amazon’s avoidance of taxes and its reliance on the United States Postal Service are ways of privatizing the value of America’s public goods. But he would do better to shift his fire altogether. Polling shows that while Americans do not trust major media institutions such as the Post, they do trust Amazon.

The big Silicon Valley target should be Google, whose social utility is running out. Peter Thiel has pointed out that, by sitting on tens of billions of dollars in cash reserves, the company has signaled it has no real ideas for expanding or anxiety about competition. And it is no longer developing its search technology, where it makes its real money. It is a giant firm that is betting against improvements in its core field.

And now its political effect is threatening to become toxic. First, Google’s dominance across the Internet has effectively made it the world’s most powerful spy agency. That’s already a vulnerability that American rivals could exploit. But Google is planning on making things worse, as it actively explores a partnership with the Chinese government. Already Google has done work creating a censored version of the Internet for China. It has been caught compiling user data to help the Chinese government fill out its blacklists. This partnership is likely to be great in the short term for Google, but it may give a geopolitical rival access to technologies and data that are vital to U.S. national security.

Google must be reminded, swiftly, that it exists thanks to the laws, technology, culture, and protection offered by the United States. We did not let U.S. arms manufacturers and IBM strengthen the Soviet Union during the Cold War, and Google should not be allowed to strengthen the Chinese Communist Party or make the Chinese model of authoritarian state capitalism more attractive.

There are other lines of attack as well. The new Republican senator from Missouri, Josh Hawley, looked into Google when he was the attorney general of his state, investigating it for anticompetitive action and public harm. Google has pushed against small competitors who are looking to disrupt the search business with hard-to-master vertical search algorithms. Investigate further. Call for privacy and disclosure legislation, modeled after the best European examples, to reconcile Google’s business practices with the norms and goods of Western society.

Google needs to be shaken up. And it should be a warning to all of Silicon Valley that the gilded age they live in can be ended roughly. Trump should have fun parodying Google’s old “Don’t be evil” motto.

5. Make Gavin Newsom defend Silicon Valley and the California model. California represents the American future. When California was becoming a middle-class paradise of low-cost bungalows in great weather with superb public services, Americans were deeply optimistic about the future. That California produced Ronald Reagan. Today California is the most unequal state in the country. It is subject to brownouts and environmental rationing; its middle class is fleeing the state’s prohibitive cost of living. Americans are pessimistic because they fear that this future is coming for them as well. California is now overwhelmingly Democratic and has elected as its next governor a lazy left-wing culture warrior who loves the billionaires of Silicon Valley.

Donald Trump should do everything possible to make Gavin Newsom and the California model his foil. Newsom has no real plans to address the cost of living in his state or its top-in-the-nation poverty rate and instead is embarking on a progressive culture war. He is already reversing the minimal toleration his predecessor, Jerry Brown, has extended to Evangelical colleges in the state, sparing them secularist dictates on their dorm and hiring policies.

Newsom embodies the Democratic party as it is coming to be under the influence of those rich whites who have come into it. It is the party that talks about inequality not because it plans on doing anything substantial about it but as an intraparty bonding exercise. Its actual obsessions are with minimal and symbolic forms of racial, gender, and sexual-identity inclusion at elite institutions, including universities, or on corporate boards. As mayor of San Francisco, Newsom spent government resources on an advertising campaign declaring that the city would not report to federal authorities the legal status of immigrants arrested there. He failed to make good on his pledge to reduce homelessness. But he will make good on his cultural grudges. A Republican president should highlight this relentlessly.

In Newsom more than any of his potential 2020 opponents, Trump will find the face of a modern American liberalism that is charmless, glib, cocksure, and totally unworthy of national leadership. He should get into reality-TV mode and cast Newsom as next season’s villain.

6. Rebalance our priorities toward work and away from education. Any long-term vision of America enhancing itself as a destination for high-end manufacturing must include a rebalancing of priorities and resources away from the most prestigious educational institutions that hoard them and toward the technical schools and other institutions that can re-skill the American worker. The economic elites who turn out for Democrats benefit partly from the now-antiquated system of American meritocracy, imposing greater costs on the economic mobility of America’s strivers. Republicans should disrupt this system.

They have been toying with the idea of ending the tax preferences that have made private colleges into powerhouses of wealth and enhanced their privilege. On a balance sheet, many of America’s elite universities resemble hedge funds with vestigial educational missions. This should be ended. If America’s elite educational institutions will no longer inculcate a spirit of public service and noblesse oblige, let their endowments be taxed and the money redistributed to technical schools and social networks that match willing learners and workers to the many remunerative and unfilled job opportunities in the American work force.

A radical-populist Trump would also attack the labor regulations that prevent the formation of private worker co-ops and worker councils of the kind that are common in Europe and build a more collaborative and flexible relationship between workers and owners. The labor movement has retreated almost entirely into public services and professional sports, two places where it arguably harms rather than advances the common good. Worker councils can keep the labor market free while enhancing the skills of young and old workers.

Finally, with the business cycle giving signs of a possible downturn in the near future, Trump’s team must do serious work developing a far-reaching infrastructure plan that cannot be reduced to another joke about his administration’s endless “infrastructure weeks.” His instinct that Americans want the best roads, transportation hubs, and airports is completely sound.

If and when a downturn comes, Trump and Mitch Mc­Connell should dare the House Democrats to choose between keeping their rich liberal base happy with symbolic opposition to the entirety of Trump’s agenda, and the kind of projects that will put men back to work and create new opportunities for business investment.

The Trump presidency is not what conservatives would have designed for themselves. And the above agenda is not what conservatives would have chosen either. But Donald Trump’s surprising electoral success opened up the Republican imagination regarding where future victories may lie. Conservatives should allow themselves to see that America’s great middle class was the vessel for its previous electoral victories and the preservation of the American order. That class is under threat from Democrats, who would remake America as an unequal society while preaching an ever more mystical and abstracted form of egalitarianism.

We already are the working-families party. Let’s act like one.

In This Issue



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