As reform conservatives see it, the main economic problems Americans confront are similar to but somewhat different from those perceived by most on the left; wage stagnation and barriers to social mobility (as distinct from inequality per se) as well as a lack of employment are both harmful in themselves and are interacting with cultural trends to undermine the traditional family and generate social chaos in most of non-upper-middle class America. In response, they broadly concede the legitimacy of the welfare state (the "reform" part) but think it's currently bloated and inefficient and should be made more means-tested, market-based, and favorable to work and family (the "conservative" part).
I have some sympathy for the reform conservative policy agenda and some criticisms, but I'm interested in Douthat's post because it exemplifies a quality of this movement that I find especially irritating; the failure of its members to recognize that they simply have very different views about the purpose and limits of government than the mainstream conservatives they hope to persuade and consider the implications of this fact for their project. The post is an evaluation of a very different proposal for reforming conservatism which he refers to as "libertarian populism," but I'm mainly interested in his criticisms of the economic policy blueprint recently offered by Senator Rand Paul, who he plausibly takes to be one of its main representatives. Douthat presents Paul's platform as including the following five planks:"(1) A balanced budget amendment, requiring deeper cuts to discretionary spending than Paul Ryan’s budget contemplates; (2) A flat tax; (3) The repeal of Obamacare, without any sort of alternative reform on the horizon; (4) An end to the Federal Reserve’s (supposedly) inflationary policies and (5) Entitlement reform." His criticisms are worth quoting at length:
[Overall,] you have a reform of the welfare state that would dramatically reduce the tax burden for the wealthiest Americans while dramatically stripping down benefits and tax breaks for the poor and working class — and which would do all this, crucially, after a long era in which the rich have already been doing just fine (to put it mildly), while wages have grown more slowly for the middle class, the employer-based health insurance system has begun to unravel, and mobility from the bottom has probably weakened.
Would a majority of Americans vote for this combination? I doubt it. Should a majority of Americans vote for it? No, I don’t think they should. Principle matters, but context matters too, and conservatives simply cannot make economic policy successfully (or credibly cast themselves as a populist party on these issues) if they ignore the actual performance of the American economy over the last generation, and if they refuse to see that distributional issues as well as arguments from efficiency and liberty have to play a role in the way that we reform our tax code and our welfare state.
It is not a surrender to big government to recognize that cutting the top tax rate was a better idea in Reagan’s era than in ours, or that making the tax code more regressive is a counterproductive response to recent trends in working class life, or that some federal programs are better targets for spending cuts and caps than others. It’s an accommodation to reality ...Note that Douthat tries to make very clear that he isn't merely questioning the political viability of this program - he's criticizing it on the merits. At the same time, other remarks in the passage make clear that he's criticizing it on the merits as a vision of conservative reform, for failing to properly interpret and apply the general political outlook he seems to take himself to share with Paul and the libertarian populists. So, considered as criticisms of this type, are his arguments successful?
I don't think so. Douthat's main criticism of the platform he considers seems to be that it would be unfair to cut back on government aid to the poor and working class at a time when existing economic and cultural trends and the economy's performance going back decades have greatly benefited the wealthy and upper middle class while causing their wages to stagnate. However, this claim depends on the assumptions that at least some welfare state programs can benefit their recipients and that guaranteeing a certain standard of living to the least well-off is a legitimate aim of government I agree with both assumptions, but I assume that a more orthodox small government conservative would offer some variant of one of the following four responses:
(1) Even if it were possible in principle for the welfare state to benefit the poor and working-class, in practice the weak incentives to perform well that government employees face because they aren't subject to market pressures and the inability of large, centralized programs to cater to specific individuals' needs will mean that either the welfare state will fail to make its beneficiaries better off or it will do so at so high a cost in resources that we're better off without it.
(2) The damage to economic growth caused by the work disincentives generated by social programs and tax breaks for the poor and working-class, as well as the other distortions that exist in our over-regulated and overtaxed economy, make them poorer even when you factor in the benefits they receive from the programs.
(3) Even if the poor and working-class benefit on net from the welfare state in a tangible economic sense, they're ultimately made worse off because of the corrosive psychological and spiritual harms that extended dependence on a distant and impersonal state for one's sustenance gives rise to. These harms are further magnified by the tendency of the welfare state to crowd out informal institutions like the family and the church, which can provide similar benefits in a way which doesn't give rise to these harms.
(4) Even if the welfare state is better for the poor and working-class in a broad sense, we should gradually work toward its abolition because it's morally wrong to use the state's coercive power to extract resources from the wealthy and give them to the poor. Coercion can only legitimately used to prevent citizens from harming one another; it's not the government's responsibility to compensate people for the consequences of bad luck or bad decisions like having children out of wedlock. The only morally permissible way to help the poor is private charity.
I don't have time to search for links right now, but I think anyone even moderately familiar with American politics will know that these are widely held views on the American right that likely provide much of the explanation for conservatives' preference for Paul's program over Douthat's own. Furthermore, whatever you think of their correctness (I disagree with all of them, but to varying degrees), I think it's quite clear that they all invoke quite general and abstract moral or empirical considerations rather than inappropriately generalizing from the GOP platform of the Reagan era in the way he implies that his opponents necessarily do in the final paragraph. I'm sure Douthat knows this as well, but he makes not the slightest effort to engage with any of these arguments or even gesture toward the idea that many American conservatives have a strong principled belief that only a minimal state which protects citizens from force and fraud is justified and that the welfare state does more harm than good anyway. Conservatives who hold versions of the four views just outlined would indeed see the ideas that some social programs don't need to be eliminated or at least cut to the bone and that a tax code which would better incentivize work and saving than the current one should be rejected because of its distributional consequences as tantamount to abandoning their political philosophy.
As I indicated above, this is perhaps my biggest frustration with Douthat and his fellow reformers. They have an interesting and plausible program that offers an important corrective to mainstream left-liberalism, but because they self-identify as conservatives they refuse to acknowledge the distance between their views and what a large body of American conservatives actually think. I don't believe, as many non-reform conservatives do, that the reformers are just closet liberals and think that their ideas do represent plausible interpretations of the conservative tradition, but the arguments I outlined above do as well and they currently have a much larger organized constituency. I imagine that the reformers insist on ignoring this fact because they think it will help them make incremental political progress, and while I'm the last person who should be giving anyone political advice, I really don't see how they're going to achieve anything without tackling one of the biggest obstacles they face head on.