How often have we heard that conservatives, or Republicans, are for the rich? To hear the Obama Administration speak, everything the Republican Party proposes is dictated by some secret cabal of rich businesspeople sitting in some oak boardroom somewhere. It borders on continuously discounted conspiracy theories. But, lets look at some facts from the past three years of the Obama Administration.
In reality, it is conservative voices that have been the most critical of Wall Street abuses. George W. Bush lamented that he had to inject the government into the free market in order to save the free market during the financial crisis through the TARP program. Yet, who were the most outspoken critics of that program when it first came up and to this day? It was not Chuck Schumer or Frank Dood or Barney Frank or Barack Obama. It was not even John McCain or Dick Lugar or any other moderate Republican. It was the more conservative political leaders who remained steadfastly opposed to TARP. And TARP was nothing more than a government bail out of Wall Street. But somewhere along the line, liberals have painted the true conservative movement as being in bed with Wall Street bankers at the expense of Main Street businesses.
In fact, conservatives have remained true to reforms that help small business over large business. However, should that small business evolve into a big business, conservatives do not, in knee jerk fashion, suddenly turn on them because they happened to suffer success. Instead, we need to advance policies that make it possible for any worthwhile business to succeed and that starts with creating the best environment to do business in the first place. Through a skewed regulatory and tax policy that stifles business, the liberal state, exemplified by Obama policy proposals, does exactly the opposite.
In fact, conservatives respect the role of entrepreneurs over that of big banks. Yet, the perception of the opposite persists mainly egged on by a complicit liberal mainstream media. In any free market economy, there will be winners and losers. That is an unfortunate fact of economic life. That is the price we pay for economic liberty. However, the true conservative subscribes to the unwavering belief that the government should not be picking the winners and the losers. Liberals oppose true, fundamental tax reform because they realize that it would necessarily eliminate those tools for social engineering they hold near and dear to their hearts.
Just looking at that monstrosity of Frank-Dodd: did it really even address the root cause of the financial crisis? In fact, it merely codified the “too big to fail” mentality that fueled the TARP debate. Likewise, Obama is very quick to point out the alleged success of the US auto industry. Leaving aside the fact that the “cash for clunkers” program was an unmitigated failure, he and others ignore the fact that there was a vehicle (excuse the pun) to save the auto industry in 2009- namely, bankruptcy. The fact remains that American cars became costly due to sweet deals with unions where workers were paid to do nothing at times not to mention pension and health care plans born by car prices. The argument was that workers in supply industries would also suffer. However, during a bankruptcy proceeding, cars would not cease being manufactured. In its place, we have the government picking winners and losers. General Motors immediately cast off its Saturn product, possibly its best product. The auto industry may be doing fine now, but additional regulations and mandates now threaten the very success they now tout.
Conservatives believe that abuses on Wall Street call for needed reforms and, if necessary, punishment for those who violate the law. But has the Obama Administration prosecuted anyone for alleged abuses during the financial crisis? Regulatory reform designed to increase transparency so that individuals have the necessary information to make informed decisions is the desired path. Regulatory reform that aims to guarantee success, however, is not capitalism in the form I was taught. In a strange, perverse way, everyone should have equal ability to succeed… or fail.
In fact, this argument is not new; only the players and industries have changed. It has transformed from railroad robber barons to oil barons to sweatshop industries to Wall Street bankers. When one thinks about it, as originally formulated (and not what it has morphed into), the #OWS group has a lot in common with the Tea Party as concerns that which originally motivated the groups. The first grumblings of the Tea Party occurred in reaction to TARP and bank bail outs. That is the same original motivation behind the Occupy Wall Street movement. But whereas the latter is demanding heads on sticks, the Tea Party is simply demanding economic freedom no matter where that leads. If a big bank was so involved in bad investments to the point that its financial stability was threatened, then so be it. Additionally, when the government intervenes, it chooses winners based on political considerations, not sound fiscal policy. For instance, why was it fine for Bear-Stearns to fail, but not Goldman-Sachs? Possibly because Goldman had more former employees interspersed through government rather than the former Bear-Stearns people?
Admittedly, the Republican Party has a perception problem this year with their nominee. Mitt Romney comes from that very class of capitalist that is the face of the greedy corporation. There is no doubt that Obama will run ads at some point showing people who lost their jobs because of some investment decision Bain Capital made under Romney’s leadership. However, this is an unfortunate by-product of a free market economy- there will be winners and losers. He needs to trot out an equal number of faces who attest to the fact their jobs were saved, even enhanced, because of decisions he made at Bain Capital.
He needs to articulate a consistent and clearly understood policy regarding regulations, tax policy, free and fair trade, and improving the business environment so that every American will be given the chance to succeed OR fail without overbearing government interference. Most importantly, he needs to avoid the class warfare tactics adopted by Obama by bridging the gap between Main Street and Wall Street and facilitating the important relationship between the two. Along the way, there will be hardships and failures, but the promise of economic freedom over a nanny state that aims, but fails, to avoid failure is a greater motivating factor in the voting booth. Its a choice between a European welfare state government and the promise of America that has drawn immigrants to these shores for over two centuries. By framing the discussion of one that embraces commonsense regulatory reform with transparency as the primary goal, of allowing even the least of the citizenry the opportunity to succeed or to fail, and allowing those that do succeed to keep more of the fruits of their labors, Romney can speak to a factor that runs deeper through American veins than party affiliation or ideological identification- the fundamental right to economic freedom and the right to succeed or fail. In short, Romney needs to bridge the gap between Main Street and Wall Street, not further widen that divide.