While the defection of Arlen Specter to the Democrats had a number of causes, the proximate cause was that his support of the Obama stimulus bill brought Pat Toomey off the fence and into a primary race Specter would have lost. Jim DeMint followed this up with a provocative WSJ op-ed arguing for more purity in the GOP caucus in sticking to small-government principles and opposing big federal spending. There’s been a lot of hand-wringing about whether the Toomey run and the views of people like Sen. DeMint mean the GOP has become too narrow and exclusionary to appeal to moderates. (Leave aside Barney Frank saying the same thing on the other side). As a deep-blue-state Republican, I have always been a believer that the GOP needs to have some flexibility in the demands of party loyalty if it is to have a tent big enough to contain a majority governing coalition; sometimes our elected officials need to treat our principles as a compass, not a straitjacket. But broad generalizations about “conservative” and “moderate” miss the fact that politics is situational. And the political situation we find ourselves in today demands that the GOP have a strong preference, in every jurisdiction, for candidates who will hold the line on spending.

How We Got Here

Let’s start by briefly recapping where we have been. The Reagan Revolution did not spring ex nihilo from the mind of the Gipper; it was the culmination of decades of pent-up, un-responded to public disapproval of high taxes, big spending, heavy regulation, and extravagant and flagrantly unsuccessful welfare policies. What finally cleared the way for Reagan was unified Democratic governance and the mess it made under Jimmy Carter. Reagan, of course, was a genuine conservative on all fronts, but even Reagan had to pick his battles, leaving some segments of the party happier with him than others. Eventually, a combination of bad decisions, weak leadership, bad economic circumstances and political tides brought down Reagan’s successor; at the core of the fall of George H.W. Bush was the loss of credibility that came about when he broke his pledge not to raise taxes, leaving voters in peacetime without a reason to distinguish him from his opponent.

But then Bill Clinton came to town, jacked up income taxes and came perilously close to imposing a ruinous energy tax plan and a disastrous government takeover of health care. Strong GOP opposition helped derail the latter two plans, and restore a clear contrast between the parties. The Gingrich Revolution of 1994 – like the Reagan one triggered under unfied Democratic governance – was largely about small government, taxes and spending, and the spending hawks got their turn at the head of the party from about 1995-98. They had some signal successes, including reducing federal spending to below 21% of GDP for the first time since Watergate, a benchmark it has stayed below until this year. But they were also outmaneuvered by the elusive Clinton, and after Clinton declared that “the era of big government is over” and worked with them to balance the budget (with a big assist from the late-90s tech boom), public enthusiasm waned.

The GOP responded by nominating George W. Bush, who accused the GOP Congress of “balancing the budget on the backs of the poor” and set about relegating the spending hawks to the back of the bus with the immigration hawks. Instead, Bush built a winning coalition in 2000, 2002 and 2004 on the three pillars of national security, taxes and social conservatism. With a war on, the spending hawks swallowed more of this than they generally wanted to.

Bush’s record on domestic discretionary spending was never as bad as it was portrayed – certainly the contrast to Obama has reminded us of that – and he did try things (like Social Security reform) that would have made a difference if they’d passed, and some of his individual initiatives are defensible on the merits … but DeMint aptly summarizes how the Bush-era GOP’s cumulative effect, combined with a handful of Capitol Hill scandals that unsurprisingly tended to arise from allocation of federal spending, eroded the GOP’s distinctive message of taking better care with other people’s money and thus respecting the freedom over one’s own property that forms the foundation of all other liberties:

No Child Left Behind didn’t win us “soccer moms,” but it did cost us our credibility on locally controlled education. Medicare prescription drugs didn’t win us a “permanent majority,” but it cost us our credibility on entitlement reform. Every year, another Republican quality was tainted: managerial competence, fiscal discipline and personal ethics.

Now, we come full circle. Once again, the Democrats have unified control of the government. Once again, they are on a spree, jacking federal spending up to 26% of GDP in a single year, blasting the deficit into orbit, rolling out plans for more taxes and regulations, plotting to nationalize health care and tax energy. Once again, the popular anxiety and anger is out there, as the voters wonder whether anybody has a better answer. Who should they call?

How We Get Out

In short, the current situation calls for the party to once again – as it did in 1980 and 1994 – re-emphasize spending discipline, lower taxes and less intrusive government. The fact that this is an especially powerful message when the Democrats are running things is not coincidental. But to do so, the GOP needs to convince voters of two things: first, that what the Democrats are doing is really bad; and second, that the GOP, if given more power, will actually do something and not just posture, fall back into bad habits or go along with the Democrats. And with the small megaphone of a legislative minority, Republicans need to paint in bold strokes to get heard at all.

This is why party loyalty on this issue is so critical at this time. If a lot of Republicans sign on to Obama’s bills, he will have a leg up in claiming to the public that he’s not really up to anything dramatic. He knows that – it’s why he tried so hard (if ham-handedly) to get Republicans to support the stimulus, and why he has tried so many legal maneuvers to compel unwilling Republican governors to accept stimulus funds and thus make it seem as if they approved of the whole idea all along. (And it is, in fact, hard even for true believers to say no to the money when the federal government has effectively already taken it from your constituents and is only asking if they want a little piece of their own money back). Only a united front can match through actions what the President – by virtue of the bully pulpit – gets to say in words.

And to rebuild the GOP brand on this issue, party unity is also critical. Contrast the ever-controversial issue of abortion. It is well-known that the GOP is the pro-life party. But voters also know and understand that some Republicans – like Rudy Giuliani, or like Specter before he switched – are not pro-life. It’s not difficult to accept that dichotomy: pro-choice Republicans call themselves “pro-choice,” and so voters can discern the difference without a lot of difficulty and without unduly watering down the party’s longstanding identification with opposing abortion.

Spending is different. All Republicans, and most Democrats, run around saying they are opposed to excessive government spending. Northeastern Republicans, in fact, have tended to excuse their views on abortion, in fact, by intoning that they are “socially liberal but fiscally conservative.” What are voters supposed to believe when they hear those terms? Only what the parties can prove by their actions. If voters are unhappy with Democratic policies on spending, taxes and regulation, and they see that a bunch of Republicans voted for all those things, they will reasonably conclude – and Democrats will be happy to tell them – that Republicans don’t really oppose them or that Republican opposition is somehow not realistic. “Don’t listen to those guys, they just want to change who spends the money.” If the GOP runs a bunch of candidates who deviate from the party line on opposition to Obama’s spending plans, they water down the message of everyone who does.

The special election in NY-20 should be a wake-up call. Republicans ran a candidate who (1) was tied to the bloated, corrupt and incompetent Democrat-dominated state government in Albany, where the GOP has not done much to draw contrasts on spending discipline and its close cousin, public integrity; (2) failed to take a clear, early stand against the stimulus bill; and (3) attacked the Democrats’ businessman candidate on liberal-populist grounds as an outsourcer who created the wrong kinds of jobs for the wrong kinds of people. Somehow, we were surprised that this didn’t work.

And that’s why even a GOP that can ill afford to lose another Senate seat is better off running Pat Toomey than Arlen Specter. Because right now, under today’s political circumstances, the only road back in the short term or the long term is to offer an unambiguous message to the voters: if you are not happy with how the majority is doing things, you have a choice.