Political Hay

Romney Had a Hammer

He used it to pound away at the "anvil" of regulation that Washington wants to drop on the rest of the country. Ronald Reagan would be proud of him.

By 1.17.08

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Mitt Romney's surprisingly decisive victory in Michigan kept him in the race for the Republican nomination, but he wasn't the only one Tuesday night to make a comeback. The contest also revived the fortunes of another GOP politician whose message, many said, just wasn't right for the times.

The other comeback kid was the late Ronald Reagan, with his message of opposition to big-government meddling. With his back to the wall after two stinging defeats, Romney ignored the advice of pollsters and pundits and campaigned on the Reagan-era theme that government is the problem. He even went after government policies that experts said were untouchable: environmental regulations.

From auto plants to the Detroit Economic Club, Romney hammered away at the "green" mandates that add so many costs to U.S. carmakers. Railing against the hike in Corporate Average Fuel Economy (CAFE) miles-per-gallon requirements for cars in the global warming bill recently passed by the Democratic Congress and signed by President Bush, Romney declared, "Washington has dropped yet another anvil on Michigan with higher CAFE standards. And now it's passively sitting back to see if the car companies can swim."

Washington's regulatory "anvil" made another appearance in a speech Romney gave at a General Motors plant where 200 layoffs had just been announced. "I also believe Washington is doing too much anvil throwing," he said. "The first CAFE program was a huge burden on the domestic manufacturing of automobiles. The next CAFE program promises to do the same thing, and what help has been associated with it? It's almost like an unfunded mandate."

"Unfunded mandate"?! Washington "drowning" Detroit with regulations? Didn't Romney read the new campaign playbooks that say sharp attacks on government regulation no longer resonate with voters?

AS NEW YORK TIMES house conservative David Brooks has argued, in the 1970s, "normal, nonideological people were right to think that their future prospects might be dimmed by a stultifying state." Way back then, "federal regulation stifled competition," and "government welfare policies enabled a culture of dependency."

But today, voters know that big government is no longer a problem. "Normal, nonideological people are less concerned about the threat to their freedom from an overweening state," the Times columnist proclaimed.

Nowadays, you see, ordinary folks think the IRS and other federal bureaucracies are just as pleasant as punch. Brooks looked at the Romney campaign and decided that Romney had "turned himself into the last gasp of the Reagan coalition."

Michigan primary voters seem not to have read Brooks's memo. (Maybe they thought it was still locked behind the late, lamented TimesSelect firewall.) Bashing big government may seem passe to Brooks and a few other Beltway conservatives, but Michiganders thought it sounded great.

As Romney articulated Washington's roadblocks to freedom and prosperity, voters nodded their heads in vigorous agreement, even on supposedly untouchable areas such as global warming.

Romney attacked chief rival Senator John McCain not just for his support of higher CAFE standards, but for the McCain-Lieberman bill that would impose taxes and rationing on energy use from carbon dioxide. In the Detroit Economic Club speech, Romney cited studies from the Energy Information Agency estimating the bill would raise electricity rates by 25 percent and gasoline by as much as 60 cents a gallon and cost 300,000 U.S. jobs.

"Placing caps and taxes on the U.S. alone just drives manufacturers to China and India, and does little more than make Washington politicians feel welcome at the embassy cocktail parties," warned the former Massachusetts governor, sounding a lot like our 40th president.

TO BE SURE, Romney is not a free-market purist, and parts of his economic program and rhetoric should be troubling to fiscal conservatives. Most notably, the proposal he outlined in Michigan to spend between $4 billion and $20 billion on research and development to revive Detroit's fortunes.

But as a proxy for big government, the level of regulation is often more important than spending. The government can spend, as the cliche goes, like a drunken sailor, and the spending can have distorting effects and increase pressure for tax hikes. But high spending doesn't directly limit a person's ability to build a business, partake in a "politically incorrect" indulgence, or seek the best drug to cure an illness.

Regulation does all of these things, as well as mandating wasteful spending by the private sector that diverts it from productive, job-creating activity.

Moreover, campaigning against regulation can often pay a bigger dividend than railing against abstract "earmarks." Since many people have a particular government prohibition pet peeve, the candidate that has a general anti-regulatory platform can frequently capture these voters.

In 1994, Republicans captured the votes of everyone from farmers and ranchers concerned about the broad reach of the Endangered Species Act to bikers who didn't like mandatory helmet laws.

Regulatory reform was featured prominently in the "Contract With America." When Republicans took the House, a slew of regulatory reform bills were introduced, and a few of them passed.

In recent years, the GOP has downgraded regulatory reform as a priority, even as the party got religion again on taxes and spending. You won't hear a consistent message against overregulation in a Republican stump speech even from some of the most conservative politicians. They seem to fear the media painting them as too pro-business or anti-environment.

YET IN MICHIGAN, Romney channeled Reagan and the Contract With America to show how deregulation can still be a winning message. He "found his voice" by going from a simple "change" agent with business experience to a pointed critic of the way government frustrates the productive sectors of the economy.

In New Hampshire, his message had seemed to be the standard line of many former executives in politics to run government like a business. In Michigan, his message more often was to just get government out of the way of business. And at times, in his own wonky way, Romney could really pair anti-regulatory sentiment with a Reaganesque optimism about the ability of American workers.

"When we send...a Ford Mustang overseas, it's not just loaded with accessories," he explained to the audience at the Detroit Economic Club. "It's loaded with our excessive healthcare costs, our excessive regulatory burdens, our excessive legal liability burden, and the taxes paid by every single automotive supplier to help put product into that car. You take off those burdens, and let's show them how fast a Mustang will actually go!"

With this anti-regulation message, Romney won males, females, Protestants, Catholics, all levels of education from high-school dropouts to postgraduates, and all income groups above $30,000. And in an important sign for the anti-regulation message in a general election -- no matter who the candidates end up being -- Romney was only six points behind McCain among the independents who voted in the primary.

As long as there is an overweening regulatory state, smart bashing of government regulation will never go out of style.

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About the Author
John Berlau is Senior Fellow for Finance and Access to Capital at the Competitive Enterprise Institute and blogs at OpenMarket.org.