Sizing up last week’s unexpected congressional win by Florida Republican David Jolly, Kim Strassel of the Wall Street Journal wrote, “The Republicans who win this fall will be those who have serious answers to the attacks leveled on them – about Obamacare, the economy, women’s and seniors’ issues.” Sound advice.
A few weeks earlier, pollsters John and Jim McLaughlin argued that to win big in November, the GOP cannot rely on Obamacare alone, unpopular as it is. More sound advice.
In particular, there must be a growth platform, aimed especially at the middle class, which continues to suffer in the fifth year of the so-called recovery, with real median income dropping by four percent and broad-based unemployment measured at roughly 12.5 percent. Believe it or not, a new Wall Street Journal poll shows that a large majority of Americans still think we’re in a recession.
So the challenge for the GOP is to drill home the old Ronald Reagan point that Republicans can increase take-home pay, or after-tax income. That doesn’t mean forgetting the Obamacare disaster, which as many predicted is falling of its own weight – the individual mandate is now dead. But it does mean the GOP must emphasize economic growth.
Fortunately, many of the party’s top thinkers are already hammering away on the growth theme.
In Joint Economic Committee hearings this past week, Republican chairman Kevin Brady talked about the “growth gap,” which describes the difference between the Obama recovery and other average recoveries of the past 50 years. America is missing 5.6 million private-sector jobs, reported Brady, and $1.3 trillion in real GDP from the economy.
Delivering the Republican Party’s weekly radio remarks last week, Senator Rob Portman of Ohio reminded us that eleven million Americans have become so discouraged they’ve given up looking for work altogether, and that while poverty rates have gone up, the average family is now bringing home $4,000 less than it did just five years ago.
And in an interview with Senator Marco Rubio this past week, I heard a number of strong growth ideas. For instance, building a national infrastructure network of interstate pipelines – like Keystone – to expedite the boom in oil and natural-gas shale development. This building can include rapid permitting for liquid natural gas (LNG) projects. As Representative Paul Ryan noted in another interview, the energy play for making and exporting LNG would remove Vladimir Putin’s energy death grip on Ukraine and the rest of Europe.
On corporate tax reform, Rubio wants the immediate expensing of any business investment, as well as an end to the double tax on American corporate profits made overseas. He also proposes greater tax relief for families with children and a refundable credit to offset payroll-tax liabilities.
Of course, Paul Ryan is a longtime tax reformer. And he notes that even the flawed tax-reform plan from Representative Dave Camp was scored by the Joint Tax Committee as adding $1,300 in annual take-home pay for individual families, 20 percent more in economic growth, and 1.8 million new jobs.
Ryan also has been criticizing the 50-year war on poverty in which perverse incentives have “isolated the poor from the rest of America in so many ways.” According to Ryan, we now have “intergenerational poverty, and people are trapped in poverty.”
Ryan argues that government programs have created huge barriers to work. For those trying to get out of poverty, high marginal tax rates can run upwards of 80 to 100 percent. Such is the case with Obamacare, where the CBO has estimated an equivalent loss of 2.5 million jobs. It’s the same for other social programs, where those who try to climb the ladder of success quickly lose the government benefits and may be pushed into a higher tax bracket.
This all has to be changed.
Bizarrely, Ryan’s courageous analysis and proposals to solve inner-city poverty have been labeled “racist” by a number of left-wing bloggers and writers. This is nuts. The left keeps throwing money at poverty that keeps getting worse. But if a Republican tries to solve the problem with a new incentive structure, the left pulls out the race card.
Putting that stupidity aside, congressional Republicans like Ryan, Rubio, Portman, Mike Lee, Ron Johnson, Eric Cantor, and many others are working on growth plans to stop the economic stagnation, pessimism, and defeatism of the Obama administration.
Let’s reward success, not punish it. As Ryan put it to me, “Here’s a vibrant agenda to create jobs, to increase take-home pay, to restart upward mobility.” As Rubio put it, pro-growth economic reforms will bring us into “a new American century.”
If Republicans stay on this reform track, they will win big in November.