tax-cuts

Making Sense of the New American Right

Keeping track of the Jacksonians, Reformicons, Paleos, and Post-liberals.

I like to start my classes on conservative intellectual history by distinguishing between three groups. There is the Republican party, with its millions of adherents and spectrum of opinion from very conservative, somewhat conservative, moderate, and yes, liberal. There is the conservative movement, the constellation of single-issue nonprofits that sprung up in the 1970s —

gun rights,

pro-life,

taxpayer,

right to work

— and continue to influence elected officials. Finally, there is the conservative intellectual movement: writers, scholars, and wonks whose journalistic and political work deals mainly with ideas and, if we’re lucky, their translation into public policy.

It’s a common mistake to conflate these groups. The Republican party is a vast coalition that both predates and possibly will post-date the conservative movement. That movement has had mixed success in moving the party to the right, partly because of cynicism and corruption but also because politicians must, at the end of the day, take into account the shifting and often contradictory views of their constituents. The conservative intellectual movement exercises the least power of all. You could fit its members into a convention hall or, more likely, a cruise ship.

Ideas matter. But the relation of ideas to political action is difficult to measure and often haphazard. The line between shaping a politician’s rhetoric and decisions and merely reflecting them is awfully fuzzy. The conservative intellectual movement, in addition to generating excellent writing, has had seven real-world applications since its formation after the Second World War:

originalism and

supply side economics in the 1970s;

welfare reform and

crime policy in the 1980s and ’90s;

educational choice and reform over the last two decades;

James Burnham’s anti-Communist strategies that found expression in the Reagan Doctrine; and the

counterinsurgency plan known as the “surge” that prevented the defeat of American forces in the second Iraq war.

There have been other successes, for sure, but also plenty of setbacks. What’s important to remember is that liberals as well as Republicans, conservative activists, and conservative intellectuals contested every single one of these policies.

The story goes that, for many years, American conservatives adhered to a consensus known as “fusionism.” Economic and social conservatives put aside their differences. Freedom, they decided, was necessary for the exercise of virtue. The struggle against and ultimate defeat of the Soviet Union was more important than domestic politics or intramural disagreements. Conservative intellectuals eager to privilege either freedom or virtue like to attack this consensus, which they often describe as “zombie Reaganism.” The truth is that the strength of fusionism always has been exaggerated. The conservative intellectual movement has been and continues to be fractious, contentious, combustible, and less of a force than most assume.

Episodes of division and strife are far more common than moments of unity and peace. The more you study the history of American conservatism, the less willing you are to describe it in monolithic terms. There isn’t one American right, there are multitudes, every one of them competing for the attention of politicians and policymakers. The most prominent and politically salient varieties, as expressed in

William F. Buckley Jr.’s National Review,

Irving Kristol’s Public Interest,

Norman Podhoretz’s Commentary, and

William Kristol’s Weekly Standard,

have weakened or disappeared altogether. One of the reasons the intra-conservative argument has become so personal and acrimonious is that nothing has replaced them.

Indeed, the situation today is awfully similar to that which confronted conservatives in the 1970s. Then, the Buckley consensus had to find a modus vivendi with neoconservatives as well as with the Catholic integralists around Triumph magazine, against the background of a populist revolt that called out failing elites while relying on racial and ethnic appeals that sometimes crossed the border of decency.

The campaign and election of Donald Trump complicated this already cloudy picture. The debate over Trump’s character and fitness for office opened, or poured salt on, wounds that have not and will not heal. Moreover, the varying opinions of Donald Trump the person became hard to disentangle from divergent assessments of his program. Fights over his rhetoric and behavior morphed into struggles over his economic and foreign policies, then changed back again. It became all too easy to score points by associating one’s opponents with either Trump’s most radical supporters or his most vociferous detractors.

Trump’s victory seemed to favor one side over the other. But such vindication may turn out to be just as much a mirage as the “zombie Reaganism” straw man. It does Trump supporters no favors to ignore the facts: The president did not win a majority, captured a smaller percentage of the popular vote than Mitt Romney, and took the Electoral College thanks to 77,000 votes spread over three states. It is also the case that to date, President Trump has been most successful when he has adhered to the traditional Republican program of

tax cuts,

defense spending, and

judicial appointments.

The rise of Donald Trump, Brexit, and nation-state populism throughout the world certainly suggest that something has changed in global politics. American conservatism ought to investigate, recognize, and assimilate the empirical reality before it. The trouble is that no one has concluded definitively what that reality is.

Not for lack of trying. Beginning in 2016, intellectuals who favored Trump have been searching for a new touchstone for conservative thought and politics. These writers are often described as populists, but that label is hard to define. Broadly speaking, they have adopted the banner of nationalism. They believe the nation-state is the core unit of geopolitics and that national sovereignty and independence are more important than global flows of capital, labor, and commodities. They are all, in different ways, reacting to perceived failures, whether of Buckley conservatism, George W. Bush’s presidency, or the inability of the conservative movement to stop same-sex marriage and the growth of the administrative state. And they have turned away from libertarian arguments and economistic thinking. Not everything, these thinkers believe, can be reduced to gross domestic product.

This emphasis on the nation as not only an economic but a political entity is apparent in the title of the “National Conservatism” conference to be held by the Edmund Burke Foundation next month in Washington, D.C. It is best articulated in Christopher DeMuth’s essay in the Winter 2019 Claremont Review of Books, “Trumpism, Nationalism, and Conservatism.” The Claremont Institute and its affiliated publications, including the new website The American Mind, have taken the lead in attempting to develop a pro-Trump conservatism in line with the principles of the American Founding.

Like populism, however, nationalism is a capacious idea that encompasses many subsets of opinion. Claremont may be the main site of nationalist conservatism, but it is not alone. Within the nationalist camp, broadly defined, are four schools of thought. Each is associated with a young Republican senator. The lines between these persuasions blur — some of the senators I name could fit into different categories, and others might not accept the labels I am about to bestow on them — but the conservative terrain has become so difficult to navigate that it’s useful to have a map. Let me take you through this new territory.

The Jacksonians

Some conservatives — myself included — see Donald Trump through the lens of Jacksonian politics. They look to Walter Russell Mead’s landmark essay in the Winter 1999 / 2000 National Interest, “The Jacksonian Tradition in American Foreign Policy,” as not only a description of the swing vote that brought us Trump, but also as a possible guide to incorporating populism and conservatism.

The Jacksonians, Mead said, are

individualist,

suspicious of federal power,

distrustful of foreign entanglement,

opposed to taxation but supportive of government spending on the middle class,

devoted to the Second Amendment,

desire recognition,

valorize military service, and

believe in the hero who shapes his own destiny.

Jacksonians are anti-monopolistic.

They oppose special privileges and offices.
“There are no necessary evils in government,” Jackson wrote in his veto message in 1832. “Its evils exist only in its abuses.”

This is a deep strain in American culture and politics. Jacksonians are neither partisans nor ideologues. The sentiments they express are older than postwar conservatism and in some ways more intrinsically American. (They do not look toward Burke or Hayek or Strauss, for example.) The Jacksonians have been behind populist rebellions since the Founding. They are part of a tradition, for good and ill, that runs through

William Jennings Bryan,

Huey Long,

Joseph McCarthy,

George Wallace,

Ronald Reagan,

Pat Buchanan,

Ross Perot,

Jim Webb,

Sarah Palin,

the Tea Party, and

Donald Trump.

The Jacksonians believe in what their forebears called “The Democracy.” They are the people who remind us that America is not ruled from above but driven from below. Irving Kristol captured some of Jacksonianism’s contradictions when he described the movement as “an upsurge of revolt against the moneyed interests, an upsurge led by real estate speculators, investors, and mercantile adventurers, which spoke as the voice of the People while never getting much more than half the vote, and which gave a sharp momentum to the development of capitalism, urbanism, and industrialism while celebrating the glories of the backwoodsman.”

The Jacksonians have extended their conception of the in-group to include Americans of every ethnicity and race. The somewhat slippery distinction they make is between American and foreigner. I say slippery because sometimes it is hard to tell when Jacksonians decide to accept a legal immigrant as fully American. Jacksonians emphasize borders. They are happy to see the government direct benefits to the middle class. They don’t want to reform entitlements. They are willing to accept short-term sacrifice if it ends up benefiting the people. They are skeptical of preemptive war, but if a conflict arises, they want to finish the job quickly and ferociously. “The very faults of the persuasion as a guide to prudent statesmanship,” wrote historian Marvin Meyers, “may have been its strength as a call to justice. For a society inevitably committed to maximizing economic gains, this persuasion in its various forms has been the great effective force provoking men to ask what their nation ought to be.”

The Jacksonian in the Senate is Tom Cotton. He’s taken the lead on conservative immigration reform. A supporter of the president, he is also a national security hawk. He was perfectly Jacksonian when he said a conflict with Iran, should it erupt, would be swiftly concluded due to overwhelming American force. A native of rural Arkansas and an Army veteran, his new book Sacred Duty describes the Jacksonian code of honor and sacrifice. If you want to know where this key swing vote in American politics is headed, watch Cotton.

The Reformocons

Reform conservatism began toward the end of George W. Bush’s presidency, with the publication of Yuval Levin’s “Putting Parents First” in The Weekly Standard in 2006 and of Ross Douthat and Reihan Salam’s Grand New Party in 2008. In 2009, Levin founded National Affairs, a quarterly devoted to serious examinations of public policy and political philosophy. Its aim is to nudge the Republican party to adapt to changing social and economic conditions.

In 2014, working with the YG Network and with National Review senior editor Ramesh Ponnuru, Levin edited “Room to Grow: Conservative Reforms for a Limited Government and a Thriving Middle Class.” The report was the occasion for a lot of publicity, including a Sam Tanenhaus article in the New York Times Magazine asking, “Can the GOP Be a Party of Ideas?”

Trump both hindered and aided reform conservatism. He dealt it a setback not only because reform conservatives opposed him in the primary (and many in the general) and he knows how to keep a grudge. He also defeated the reform conservatives’ most promising champion, Marco Rubio. And he did it in part by emphasizing two issues, trade and immigration, that were missing from “Room to Grow.”

But that is not the end of the story. Trump also obliquely aided reform by smashing the status quo and proving the Douthat and Salam thesis that support from whites without college degrees is essential to Republican victory. After the election, Rubio kept advocating for democracy and human rights, but jettisoned supply side orthodoxy. He fought successfully to expand the child tax credit in the 2017 tax bill. He proposed a paid parental leave policy and criticized stock buybacks. In 2018 he delivered a speech arguing for a “new nationalism” based on “an economy built on the dignity of work,” the family as “the most central institution in society,” “working together in community,” and “the belief that every human being is endowed by God with an inalienable right to life, liberty, and the pursuit of happiness.”

Rubio has cited Oren Cass’s The Once and Future Worker (2018). It’s worth noting that Cass is a senior fellow at the Manhattan Institute, where Salam recently became president. Meanwhile, Levin’s follow-up to his Fractured Republic (2016) is a call for rebuilding institutions crucial to the formation of character. Reform conservatism, in other words, is far from being a spent force.

The Paleos

Where the paleoconservatives distinguish themselves from the other camps is foreign policy. The paleos are noninterventionists who, all things being equal, would prefer that America radically reduce her overseas commitments. Though it’s probably not how he’d describe himself, the foremost paleo is Tucker Carlson, who offers a mix of traditional social values, suspicion of globalization, and noninterventionism every weekday on cable television.

Carlson touched off an important debate with his January 3 opening monologue on markets. “Culture and economics are inseparably intertwined,” Carlson said. “Certain economic systems allow families to thrive. Thriving families make market economies possible. You can’t separate the two.”

Carlson’s indictment of America’s “ruling class” and “the ugliest parts of our financial system” was remarkable for several reasons. First, he delivered it on a network whose opinion programs normally laud American capitalism and free enterprise. Second, the speech was wide-ranging, criticizing everyone from Mitt Romney to Sheryl Sandberg to parents who let their kids smoke weed. Third, Carlson offered a theory of the case. Social decline, he said, is related to the loss of manufacturing jobs. It happened in the inner cities. Now it’s happening in the Rust Belt and in rural America. When jobs disappear and low-skilled male wages decline, family formation breaks down.

While Carlson noted in passing that wage income is taxed at a higher rate than investment income, he did not make any specific proposals. “I’m not a policy guy, I’m a talk show host, but I sincerely believe that no problem is solved unless you have a clear image in your mind of what you want the result to be,” he told Michael Brendan Dougherty at the National Review Institute conference in March. Earlier this month, he welcomed John Burtka, the chairman of the paleo journal The American Conservative (TAC), on to his program. Burtka argued for treating the social media giants as monopolies. Carlson loved it.

In a separate piece for TAC, Burtka offered a defense of “economic nationalism.” He advocated a national industrial strategy, without providing many details, though presumably incorporating some mixture of tariffs and government-directed investment. This reluctance toward nuts-and-bolts legislative proposals is widespread. “We still need to figure out a lot of the details for how this vision of conservative politics, a pro-family, pro-worker, pro-American nation, conservatism actually looks in practice,” J. D. Vance told a recent TAC gala. We’re waiting!

Paleos have brought renewed attention to the condition of American communities. Tim Carney of the American Enterprise Institute and Washington Examiner devotes his new book, Alienated America, to the frayed bonds that barely connect working-class Americans to each other. Like Carlson, Mike Lee might not accept the paleo label, but he best represents this mixture of traditionalism, communitarianism, and nonintervention in the U.S. Senate. His social capital project is a major effort to assess the strengths and vulnerabilities of American society. He’s worked with Rubio on parental leave, though it should be said that unlike paleos he opposes Trump’s trade policies. Paleos might not have exact answers when it comes to domestic policy, but they are certain American foreign policy should be restrained, within constitutional bounds, and prioritize diplomacy over military force.

The Post-liberals

Here is a group that I did not see coming. The Trump era has coincided with the formation of a coterie of writers who say that liberal modernity has become (or perhaps always was) inimical to human flourishing. One way to tell if you are reading a post-liberal is to see what they say about John Locke. If Locke is treated as an important and positive influence on the American founding, then you are dealing with just another American conservative. If Locke is identified as the font of the trans movement and same-sex marriage, then you may have encountered a post-liberal.

The post-liberals say that freedom has become a destructive end-in-itself. Economic freedom has brought about a global system of trade and finance that has outsourced jobs, shifted resources to the metropolitan coasts, and obscured its self-seeking under the veneer of social justice. Personal freedom has ended up in the mainstreaming of pornography, alcohol, drug, and gambling addiction, abortion, single-parent families, and the repression of orthodox religious practice and conscience. “When an ideological liberalism seeks to dictate our foreign policy and dominate our religious and charitable institutions, tyranny is the result, at home and abroad,” wrote the signatories to “Against the Dead Consensus,” a post-liberal manifesto of sorts published in First Things in March.

“The ambition of neoliberalism,” wrote the editor of First Things in the spring of 2017, “is to weaken and eventually dissolve the strong elements of traditional society that impede the free flow of commerce (the focus of nineteenth-century liberalism), as well as identity and desire (the focus of postmodern liberalism). This may work well for the global elite, but ordinary people increasingly doubt it works for them.” The result, he said, has been populist calls for the “strong gods” of familial, national, and religious authority.

The post-liberals are mainly but not exclusively traditionalist Catholics. Their most prominent spokesman is Patrick J. Deneen, whose Why Liberalism Failed (2018) was recommended by that ultimate progressive, Barack Obama. Israeli philosopher Yoram Hazony’s Virtue of Nationalism(2018) is another important entry in the post-liberal canon. Hazony has contributed essays to both First Things (“Conservative Democracy”) and American Affairs (“What Is Conservatism?”) making the case for conservatism without Locke, Jefferson, and Paine.

The post-liberals have put forward two contradictory political strategies. The first, advanced by Rod Dreher, who is Eastern Orthodox, is the Benedict Option of turning away from the secular world and shielding, as best you can, spiritual life. The second, as put by Sohrab Ahmari also in First Things, is “to use these values [of civility and decency] to enforce our order and our orthodoxy, not pretend that they could ever be neutral.”

Another post-liberal, Gladden Pappin of American Affairs, says,

Rather than asking the question, ‘What should conservatives/progressives do?’ considerable advances can be made through certain purely practical considerations: ‘How can the integrity of the national political community be assured?’ ‘How can commercial activity and technological development continue to be turned toward the common good, and toward our own strategic advantage?’ ‘What can we do with the reins of power, that is, the state, to ensure the common good of our citizens?’

The closest the post-liberals have to a spokesman in the Senate is freshman Josh Hawley, who attends an evangelical Presbyterian church. Not six months into his term, Hawley has already established himself as a social conservative unafraid of government power. He has picked fights with the conservative legal establishment by criticizing two of President Trump’s judicial appointments. He has identified Silicon Valley as a threat to traditional values and proposed legislation to begin to rein in the tech industry. And in a little noticed commencement address to King’s College, he inveighed against the fact that

For decades now our politics and culture have been dominated by a particular philosophy of freedom. It is a philosophy of liberation from family and tradition; of escape from God and community; a philosophy of self-creation and unrestricted, unfettered free choice.

This “Pelagian vision” — Pelagius was a monk condemned by the Church fathers as a heretic – “celebrates the individual,” Hawley went on. But “it leads to hierarchy. Though it preaches merit, it produces elitism. Though it proclaims liberty, it destroys the life that makes liberty possible. Replacing it and repairing the profound harm it has caused is one of the great challenges of our day.”

The post-liberals say that the distinction between state and society is illusory. They argue that, even as conservatives defended the independence of civil society from state power, the left took over Hollywood, the academy, the media, and the courts. What the post-liberals seem to call for is the use of government to recapture society from the left. How precisely they intend to accomplish this has been left undefined. (Though the levy on large university endowments included in the 2017 tax bill is a start.)

Another question is whether the post-liberal project is sustainable in the first place. The post-liberals, like other nationalists, may have over-interpreted the results of the 2016 election. Trump is many things, but it is safe to say that he is not an integralist. Prominent online and in my Twitter feed, the post-liberals might also misjudge their overall numbers. Before they recapture the state, much less re-moralize a nation of 300 million and hundreds of sects and denominations, they must first convince their co-religionists.

Appeals to the common good are rhetorically powerful, but they often run up against the shoals of America’s constitutional structure and overwhelming emphasis on individual rights. That is one potential reason the post-liberals seem more interested in European philosophy and politics. It also could be why many of them are eager to abandon the term “conservatism.”

Which might be for the best. Fusionism’s critics say that it was historically contingent on the unique situation of the Cold War. But if you read the best expression of “fusionist” conservatism, the Sharon Statement of 1960, you see that its ideas of freedom and constitutionalism are deeply embedded in American intellectual traditions. “There is only one American political tradition,” wrote Irving Kristol, “and every political movement must obtain its sanction, invoking the same memories, the same names, the same archetypal images, even the very same quotations.” A conservatism that does not incorporate the ideas of freedom and civil and religious liberty that imprinted America at its birth not only would be unrecognizable to William F. Buckley, Barry Goldwater, and Ronald Reagan, Americans themselves would find it alien and unappealing. And rightly so.

The Trump coverup no one is talking about: The emperor has no money

But Trump’s theatrics were also very convenient because they disguised the fact that he cannot now, or ever, deliver on his signature promise to create a “great” infrastructure program. This is why Trump “infrastructure weeks” have become a standing joke in Washington. LaTourette was right: The Republican Party is no longer interested in spending public money to solve big problems if doing so gets in the way of cutting taxes.

LaTourette explained this in his rough-and-ready way back in 2011 when he called the 2010 tea party class of Republicans “knuckledraggers that came in in the last election that hate taxes.”

One of those newcomers was Mick Mulvaney, now Trump’s acting chief of staff and budget director. From the moment Trump, Pelosi and Schumer announced their convergence on a $2 trillion infrastructure plan last month, Mulvaney began sabotaging it. “Is it difficult to pass any infrastructure bill in this environment, let alone a $2 trillion one, in this environment? Absolutely,” Mulvaney said.

He was far from alone because the entire Republican leadership in Congress is now part of the Knuckledraggers Caucus. Senate Majority Leader Mitch McConnell quickly signaled that he had absolutely no interest in a big infrastructure plan if it required rolling back any part of the GOP’s 2017 corporate tax cut.

Democrats argue that because business is clamoring for infrastructure, it would make sense to ask business to foot part of the bill. They have suggested raising the corporate tax rate to 25 percent from the 21 percent enshrined in the 2017 law and pulling back on some of its other provisions.

No way, say the Republicans. A “nonstarter,” declared McConnell. Faced with the choice of bridges collapsing in a heap or reining in the tax giveaways, the bridges don’t have much of a chance.

Note that the meeting Trump sabotaged was about how to finance the plan. He had no way of coming up with anything constructive because, for all of his bravado, he is totally under the thumb of Congress’s conservative ideologues. His tantrum was part of the coverup no one is talking about: The emperor has no money.

This fact underscores a widespread misunderstanding about our politics. “Normal” Republicans are regularly described as privately horrified with Trump. Trump is said to have engaged in “a hostile takeover” of the GOP.

In fact, it’s Trump who has been taken over. He campaigned as a different kind of Republican, and his infrastructure promise was a major component of his antiideological image. But on all the things the ideologues and right-wing business interests care about —

tax cuts,

corporatist judges,

deregulation —

Trump caves in.

We know the president’s boast that he “could stand in the middle of Fifth Avenue and shoot somebody and I wouldn’t lose any votes.” Perhaps Republicans in Congress wouldn’t go that far. Otherwise, they’ll keep standing with him as long as he prostrates himself before their tax-cutting god, even if this means showing he is too weak and powerless to fix the roads.

Ignorance Abounds About Supply-Side Economics

The movement’s main founder, Robert A. Mundell, wrote prolifically on the subject avant la lettre in top economics journals in the 1960s and 1970s. Mundell’s protégé at the University of Chicago, Arthur B. Laffer, did the same, then branched out to a consulting business where he put out some 50 papers per year that dilated on supply-side economics.

Archives? The Hoover Institution in California has hundreds of boxes of papers of the first journalistic supply-siders, Wall Street Journal editor Robert L. Bartley and his assistant Jude Wanniski. As for supply-side economics’ Congressional lodestar, Jack Kemp, there are more boxes on end at the Library of Congress.

I looked and looked at all this stuff, and a definition emerged clear as the sky. This was that supply-side economics favored a particular way of solving the kind of recessions we have been prone to since the founding of the Federal Reserve and the income tax, both in the year 1913. This is to stabilize the dollar and cut taxes.

This definition—stabilize money and cut taxes—was repeated so often, so uniformly, and over so much time by the original supply-siders that it became possible to identify a canonical statement, the Ur-document, the quintessential rendering of the supply-siders as to their philosophy.

This is it, from a paper Mundell wrote in 1971: “The correct policy mix is based on fiscal ease to get more production out of the economy, in combination with monetary restraint….The increased momentum of the economy provided by…a tax cut will cause a sufficient demand for credit to permit real monetary expansion at higher interest rates.”

As for details, to a one the supply-siders favored tax cuts of the marginal and capital-gains variety, and monetary stability in the form of a gold-anchored dollar.

Readers of this column can be forgiven for asking if I haven’t been repeating myself. Haven’t I availed of the above Mundell quotation in recent columns, keen to point out that supply-side economics is a policy mix of two things, stable money and marginal tax cuts?

Indeed I am repeating myself—for an all too appropriate reason.

Last week, for the umpteenth time, a major, credentialed economist wrote an article, one read far and wide, contending that supply-side economics has to do exclusively with tax cuts. There is probably no bigger economics blogger than Mark Thoma, and marginal-tax-cuts-equal-supply-side-economics is what he made his supposition in “Why the GOP Won’t Admit Supply-Side Econ Has Failed.”

You can click on the link to see Thoma go about all this, but the essential thing is as follows. There is no credible historical evidence ever produced by a scholar that has served to delink monetary issues from the core doctrine of supply-side economics. In fact, all primary evidence ever produced as to the central claims of supply-side economics has confirmed that supply-siders insisted that monetary restraint and progress toward a gold standard is as crucial as any kind of tax policy. To say otherwise is to speak in the absence of evidence.

But in current circumstances, you see how it can be so…tempting…to say that supply-side economics was only ever a policy of tax cuts. This is because the George W. Bush tax cuts—those things on the chopping block in this fiscal cliff drama—supervised a mere boomlet in the mid-2000s, and then the Great Recession after 2008. If you trash W.’s policy by calling it supply-side, then by association you can discredit the Reagan success too. Conservative economic policy: a comprehensive failure in its decades-long response to Keynes!

Go back to the record ten years ago and see if the supply-siders were unconcerned about monetary issues, as the Bush-era Fed made money as loose as it was in the 1970s. See if Robert Mundell quit on the idea of a unitary dollar-euro exchange rate and an anchor akin to gold. See if the second generation of supply-siders, the next round of journalists and Congressmen (such as Kemp trainee Rep. Paul Ryan) didn’t call out the money-printing 2000s as making the W. tax cuts nothing but a “small, ambiguous reprise” of the great tradition, as I would put it in the book, Econoclasts, which came out in 2009.

But “everyone knows” that supply-side economics’ main, if not exclusive concern was with tax cuts, and that’s good enough for Mark Thoma. Cui bono from burying the true history of the objectives of supply-side economics? Fiscal-cliff corner-cutters and their enablers, but certainly not sincere political economists trying to master our recent history for the purpose of getting our once-great economy back in good repair.

My Best Growth Forecast Ever

The Trump administration’s tax reform of 2017, which took effect in 2018, was viewed prospectively, and now retrospectively, as a contributor to US economic growth. But there was – and remains – a great deal of controversy over the size of the macroeconomic effects of the tax changes.

All businesses benefited from a move to full expensing for equipment, though this change did not apply to structures. Our research predicted a substantial long-term increase in capital accumulation, which would generate sizable gains in labor productivity and real wages. Real GDP growth was predicted to be higher over ten years by an average of about 0.2% per year. Thus, the predicted growth effect was moderate but long-lasting.

As an aside, I have a bet with a famous Harvard colleague who has promised to eat his proverbial hat if 3% GDP growth persists over a longer period. I recall that the bet specified the period as the full two years – 2018 and 2019 – but he now remembers it as the three years from 2018 to 2020. I think I must be right, because I never forecasted high economic growth for 2020.

I take it as self-evident that faster economic growth is better than slower economic growth. Underlying this sentiment is that millions of people benefit from higher growth rates, which are typically accompanied by higher wages and lower unemployment, which especially help the worse-off. Yet today, the antipathy toward the Trump administration is so intense that many people, including some of my economist colleagues, are rooting for lower economic growth just to deny Trump a political win.

I understand this viewpoint, but I still think that the direct benefits from a better economy outweigh this kind of political calculus. More to the point, the beneficiaries – which include most people and most voters – must favor faster over slower growth.