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The Giant Stumbles

Government looks bigger, but not so sturdy, in Obama’s second term.

By From the September 2013 issue

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WHEN BARACK OBAMA won a second term, many conservatives and libertarians despaired. It seemed that the tipping point between the “makers and the takers,” between a constitutional republic and a social democracy, had been reached.

That was certainly vanquished Republican nominee Mitt Romney’s take. In a widely quoted postmortem conference call with supporters, Romney concluded, “What the president, the president’s campaign did was focus on certain members of his base coalition, give them extraordinary financial gifts from the government, and then work very aggressively to turn them out to vote, and that strategy worked.”

Romney then suggested this wouldn’t be a one-time event: “the giving away free stuff is a hard thing to compete with.” It’s an observation as old as FDR adviser Harry Hopkins’ (probably apocryphal) quote: “Tax and tax, spend and spend, elect and elect.” Only in a deficit-financed welfare state, the “tax” part is often treated as superfluous. 

Not only are the demographics of the country gradually moving in the Democratic direction, but the number of clients of the welfare state is growing. With record numbers of Americans receiving food stamps, the baby boomers retiring and beginning to collect Social Security and Medicare, and increasing collusion between big government and big business, Obama’s reelection was hardly the only thing that seemed to guarantee government’s continued growth.

Yet the first year of Obama’s second term hasn’t unambiguously consolidated big government’s gains. Part of this is because the president has seemingly settled into the lame-duck funk that plagues many a second term. But there have been several developments impeding government growth, including some that will be hard to reverse.

First, Obama has been hit by a series of scandals that remind people of the power and intrusiveness of the federal government. The Internal Revenue Service singled out applications from Tea Party groups for special scrutiny. The Justice Department snooped on Associated Press reporters and other journalists. The National Security Agency scooped up Americans’ phone records in a domestic data mining operation far greater than anyone anticipated.

None of these scandals had the political impact Republicans might have hoped. The White House was able to insulate itself from the ensuing controversy—as was the case with Benghazi. Media coverage was ghettoized in the conservative press—as with Operation Fast and Furious. Though the NSA, AP, and IRS scandals received enough mainstream coverage to permeate the public consciousness, the president has weathered them about as well as can be expected.

Cumulatively, however, they took a toll on the public’s already shaky confidence in Washington. Gallup periodically asks Americans: “In your opinion, which of the following will be the biggest threat to the country in the future: big business, big labor or big government?” In the last poll on this subject, taken in December 2011, 64 percent chose big government.

It might be time for Gallup to ask again. During the first quarter of 2013, Obama’s average approval rating tumbled to 47.9 percent. An NBC News/Wall Street Journal poll found Obama’s job approval at just 45 percent, with only 29 percent saying the country is on the right track. Congress’s disapproval rating stands at a staggering 83 percent.

The polling on the NSA matter varies widely depending on how the question is asked. When national security and terrorism are emphasized, it is possible to cobble together majorities—sometimes substantial—in support of the surveillance program. But pollsters point out that it involves the phone records of huge numbers of innocent Americans, people become very skeptical.

A poll by the Pew Research Center found that 56 percent of the American people believe federal courts don’t provide an adequate check on the federal government’s intrusion into the phone and Internet usage of ordinary citizens. Pew also asks whether the government’s anti-terrorism programs “have gone too far in restricting civil liberties, or not far enough to protect the country.” Among Republicans, there has been an 18-point swing in the civil libertarian direction over the last three years alone.

Second, despite near-apocalyptic predictions from the White House and many Democrats, sequestration has mostly been a non-event. As late as April, Obama press secretary Jay Carney was exhorting the media to devote more coverage to pain inflicted by the automatic reductions in the rate of spending growth.

“The impacts are real,” Carney said in a testy exchange with Fox News’ Ed Henry, “and they affect real people. And I know that there hasn’t been a lot of coverage of the impacts on real people.” Real people seem to think differently. According to a CBS News poll, 69 percent say they haven’t been impacted by the sequester. Only 8 percent say they have been affected greatly.

Even polls that purport to show rising public concern over sequestration don’t find huge numbers of people who say they’ve been hurt directly. One widely touted NBC News/Wall Street Journal poll that reported an uptick in public pain still only found 22 percent of Americans claiming a significant personal impact.

Like Keynesian budget forecasters, the American people aren’t optimistic that sequestration will be good for the economy. (They aren’t optimistic about much of what the government does.) But the economy has generally continued its pre-sequester path of lackluster growth, expanding enough to stay out of recession but not nearly enough to result in full employment. When faced with an administration that has tried to make budget cuts as painful as possible, the results could have been much worse.

Sequestration isn’t big enough or targeted correctly to solve the country’s long-term fiscal problems. The cuts are also poorly conceived and too cavalier about the defense budget. But for better or worse, the sequester emerged as a referendum on whether Congress could ever cut any spending. For that reason alone, the fact that it was allowed to take place should be viewed as a positive development.

A third factor putting the brakes on big government might be more enduring: the emergence of a serious limited-government faction inside the Republican Party. One of the biggest reasons the state tends to grow no matter who is in power is that the country has two big-government parties. Some Republicans are starting to change that, however.

Serious fiscal conservatives now have large enough numbers in the House that they, not the Republican leadership, often drive the legislative agenda. Yes, John Boehner was re-elected speaker while Justin Amash, Tim Huelskamp, and Walter Jones were kicked off their preferred committees for being too conservative. But Boehner often has to turn to either his right flank or the Democrats to get anything done.

In the Senate, committed fiscal conservatives haven’t just reached critical mass. Senators like Rand Paul, Ted Cruz, and Mike Lee have repeatedly shown a willingness to rock the boat and confront the leadership of both parties when necessary. Such go-it-alone conservatives have existed in the Senate before—think Jesse Helms—but seldom has there been a group of them working in tandem.

Republicans in Washington face enormous outside pressure—and for the first time ever, much of the pressure is coming from their right. Organizations like the Club for Growth, Heritage Action, FreedomWorks, Young Americans for Liberty, and countless Tea Party groups all over the country are making it very difficult to be a big-government Republican. They are not just measuring how often legislators voted against bad bills or supported good ones. They are evaluating how members behaved in key moments in the growth of government.

THAT IS A major change from even the recent past. It used to be that if someone served in Congress, got decent ratings from the American Conservative Union, and generally voted the conservative line, right-leaning groups would look the other way if he voted for something like Obamacare funding or backed a party-led industry bailout. Not anymore.

The implications of this are significant. It used to be that successful primary challenges could only be mounted against relatively scandal-free Republican incumbents if they opposed conservatives on a wide variety of economic and social issues. A moderate Republican like George Voinovich was safe because he was pro-life. Others could vote against tax cuts but survive because they were pro-gun. In 2004, Arlen Specter was to the left of his party on abortion, taxes, immigration, affirmative action, and tort reform. (I’m probably missing something.) In 2006, Lincoln Chafee barely differed from the average liberal Democrat (he has since joined the party of Obama). Specter and Chafee both won their Republican primaries.

Since then, we have seen Specter and Charlie Crist leave the Republican Party rather than face conservative primary challengers. Utah Sen. Robert Bennett was defeated because of his vote for the TARP bailout. South Carolina Rep. Bob Inglis lost a primary by 42 points for the same reason. Richard Lugar lost his primary while Orrin Hatch and John McCain had to fight to win theirs. Even Mitch McConnell may face a non-trivial primary challenge, as some outside conservative groups like the Madison Project signal support for Matt Bevin.

That’s not to say that all of these conservative primary challengers are good candidates. Some manifestly are not. Primary victories by unready or unsteady conservatives clearly translated into Republican Senate losses in Delaware (Christine “I’m not a witch” O’Donnell) and Indiana (Richard “something God intended to happen” Mourdock), and arguably soured winnable races in Nevada and Colorado. The combative legislative strategies pursued by the Republicans who do get elected are not always wise.

But the net effect has been to change the political incentives faced by Republican officeholders. For decades, Republicans have heard the demands of groups requesting more government spending. Some of these demands came from liberals who were never going to vote Republican anyway. Some came from reliable GOP constituencies, such as farmers, military contractors, and senior citizens.

When these voters would approach a Republican politician hat-in-hand, only that politician’s internal moral and ideological compass gave them a reason to say no. Consequently, they often said yes. But now voters and activists demand a higher standard, and they will throw out of office any lawmaker who strays. Moderate Republicans have reasons like never before to suppress their inner statist; conservatives have added incentive to follow their convictions.

This process began to play out in the Republican presidential primaries, where candidates often compete to show their conservative bona fides (even though the less conservative establishment candidate usually wins). It is now at work as well in congressional and even school board races. Over the long term, it can only push the party to the right across the board—and perhaps make the GOP a real limited-government party for the first time since Calvin Coolidge occupied the White House.

REPUBLICANS' RIGHTWARD SHIFT has had practical effects, too. Take the debate over Obamacare. It is possible that congressional Republicans would have maintained their commitment to repealing the Affordable Care Act even after the Supreme Court upheld the controversial law and Obama was re-elected. But based on the recent history of the GOP, it is not terribly likely. Many old-line Republicans already seemed to be going wobbly in the summer of 2010. It was the new Tea Party accountability that kept the GOP united against Obamacare.

Which brings us to perhaps the most important impediment to big government in Obama’s second term: the continuing unpopularity—and persistent flaws—of his signature legislative achievement. While Nancy Pelosi once advised us to pass the bill so we could see what’s in it, the Democrats have been consistent in saying that once Americans saw what was in it, they would like it.

That hasn’t panned out. Majorities still tell pollsters they would like to see Obamacare repealed, another reason Republicans have not caved on the issue. According to a recent Fox News poll, 85 percent of Republicans and 65 percent of independents back repeal. So do more than a fifth of Democrats. Pluralities believe Obamacare will end up costing them money rather than making health care more affordable.

A Washington Post/ABC News poll found that support for the law among moderate to conservative Democrats has dropped from 74 percent in 2010 to just 46 percent in July. 

Unlike the vote to enact Obamacare, opposition to the law has always been bipartisan. The law’s 1099 reporting requirement has already been repealed with bipartisan support and the president’s signature. Repeal of the medical devices tax has majority support in the Democratic Senate. Two dozen House Democrats voted to delay both the individual and employer mandates. A pair have even voted for full Obamacare repeal.

Liberal opinion journalists have pushed back hard against the notion that Obamacare is unraveling, when they aren’t instead blaming its manifest problems on Republican obstructionism. But Republicans aren’t the ones causing employers to cut back on health care benefits and to trim their employees’ hours to part-time ahead of Obamacare’s new mandates and regulations. It’s not GOP obstructionism that, by the Congressional Budget Office’s estimate, will cause some 7 million Americans to lose their employer-provided health insurance.

All of these are consequences of the law itself. When the Obama administration opted to delay the employer mandate for a year, it was conceding another problem: possible Obamacare-induced job losses ahead of the 2014 midterm elections. The income verification requirements for the subsidies in the health care exchanges have been delayed. The small business exchange has been postponed.

Even if Republicans were fully on board—and many GOP governors have proved eager to accept the Medicaid expansion funds—these delays don’t suggest a lot of confidence that the law is well constructed. The Democratic senator who helped write it has called its implementation a “train wreck” and has chosen to retire rather than defend his handiwork in front of voters. Democrats hope to market the law with the help of celebrities and sports heroes.

OBAMACARE'S FATE IS important to the broader question of government’s size for two reasons. The first—and most obvious—is that Obamacare is itself a huge entitlement program that constitutes an enormous expansion of the federal government. Millions of Americans will end up receiving its subsidies or being enrolled by it in government health care programs like Medicaid. 

But that’s not the only way Obamacare is likely to grow government. The problems with the Affordable Care Act could be solved by repeal, or by, at the very least, free-market reforms of the the subsidies, regulations, and mandates. But Congress is just as likely to try to solve them by further expanding the government’s role in health care.

Many liberal Democrats were upset that Obamacare didn’t ultimately contain the “public option,” a government-run health care program that would have ostensibly competed with private insurers. For the single-payer advocates among them, dropping the public option wasn’t a compromise—the public option was a compromise. These liberals will push to revisit the idea. Every problem with Obamacare that cannot be blamed on Republicans will be blamed on the remaining private-sector components to health care.

There’s a second, less direct reason Obamacare is such an important front in the fight against big government. While federal spending has increased dramatically under Presidents Bush and Obama, middle-class taxes have not. (Bush cut taxes, and Obama’s tax hikes were fairly limited.) Such an arrangement—vast spending increases without new revenues—results in huge deficits, and even the Democrats are unwilling to run $1 trillion deficits indefinitely.

Under Obamacare, the cost of big government is finally going to hit the middle class. The Democrats hope the benefits will seem worth the price. But they will no longer be able to deny that those costs exist. Big-government liberalism is most popular when it is free. It has never fared well once ordinary people begin footing the bill. 

Obamacare has the potential to be what lines for gasoline were in the 1970s: an example of government failure that impacts basic needs. Here, too, Democrats can hope that the contraption will work, at least well enough by the meager standards of government programs. But it’s not off to an auspicious start, as the premises that underlie Obamacare increasingly collide with reality. 

To be sure, none of this is inevitable, like some kind of Marxist withering away of the state. The government scandals of 2013 could fade into memory, dislodged from the headlines by royal babies and the World Series. The Tea Party conservatives could miscalculate, inviting a public backlash and preventing Republicans from wielding the kind of power they would need to re-limit government. The economy is sputtering. If it were to slow further, or even dip back into recession, it’s possible that sequestration and some mythical austerity will be blamed. IMF economists are already arguing that deficit reduction is to blame for poor economic and employment growth. Obamacare has proven to have a cat-like nine lives so far, avoiding political catastrophes as it struggles to exist alongside other broke entitlements and insolvent pension programs.

All of the trends outlined here can only be acted upon if Republicans display a level of political competence that has tended to elude them since Ronald Reagan shuffled off to California in 1989. But we’ve been sold on the idea that big government is inevitable, that ascendant liberalism cannot be stopped. Obama is thought to be creating a new New Deal Coalition right before our very eyes, while Republicans look on helplessly.

Don’t believe it. 

Photo: UPI

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About the Author

W. James Antle III, author of the new book Devouring Freedom: Can Big Government Ever Be Stopped?, is editor of the Daily Caller News Foundation and a senior editor of The American Spectator. You can follow him on Twitter @jimantle.