The Return of Conservative Economics
Today we are announcing the formation of American Compass, an organization dedicated to helping American conservatism recover from its chronic case of market fundamentalism. In preparation, we have been perusing the mission statements of many of our nation’s think tanks. Nearly every group has one. Oddly, the right-of-center’s preeminent public-policy institutions all have the same one: to advance the principles of “limited government, free enterprise, and individual liberty” or “free markets and limited, effective government” or “free enterprise, limited government, individual freedom” or “individual liberty, limited government, free markets” or “economic choice and individual responsibility” or “individual, economic, and political freedom; private enterprise; and representative government.”
Without question, those principles are vital. But an emphasis so monotonal is neither supportive of effective deliberation nor genuinely conservative. “Why don’t we look at a policy and just ask, does it expand economic freedom?” suggests Heritage Foundation vice president Jack Spencer. Because there is more to life than economic freedom. Also, there is more to economic freedom than economic freedom. A society that attempts to maximize everyone’s freedom at every moment will fail miserably in preserving individual liberty and limiting government over time.
What is missing from our public debates is a distinctively conservative approach to economics. The modern right-of-center coalition is the product of the “fusionism” that joined economic libertarians with social conservatives and Cold War hawks in an era when the defeat of Communism was of preeminent importance to all three. Having for decades outsourced their economic thinking to libertarians, conservatives now watch from the sidelines as classical liberals (i.e., libertarians) and modern liberals (i.e., progressives) debate how best to pursue their shared and unquestioned priorities of personal consumption and aggregate economic growth.
One side favors fewer government programs and less regulation, the other advocates more. Both claim the mantle of buzzwords such as dynamism, opportunity, and mobility. Neither prioritizes the traditional structures of family and community that provide the foundations of a flourishing society, or the capacities that a nation must nurture and sustain to remain strong. Consensus views across the political, business, and academic elite have enormous blind spots, from the dangers of globalization, to the costs of a college-for-all education system, to the value of belonging to a particular place. At home, the data on collapsing families, shuttering communities, stagnating wages, and declining life expectancy are well known. Abroad, America’s capacity to protect and advance its national interests is likewise waning.
The problems animating America’s resurgent populism are very real. They will be solved neither by the ideological alignments that governed us into the crisis nor by that populism itself, which has demonstrated no ability to formulate or implement a coherent response. Look carefully, though, and green shoots are emerging.
Senator Josh Hawley (R., Mo.) wrote recently that our “public philosophy says liberty is all about choosing your own ends. That turns out to be a philosophy for the privileged. For everybody else, . . . those whose life is anchored in family and home and nation, for those who actually want to participate in our democracy, today’s [philosophy] robs them of the liberty that is rightfully theirs.” Senator Marco Rubio (R., Fla.) observed: “We have become defenders of the right of businesses to make a profit, the right of shareholders to receive a return on their investment, and the obligation people have to work. But we have neglected the rights of workers to share in the benefits they create for their employer — and the obligation of businesses to act in the best interest of the workers and the country that have made their success possible.”
Unlike the prevailing orthodoxy, conservative economics will take seriously the effects of social and market forces on each other. It will concern itself with the pernicious effects that high levels of economic inequality can have on the social fabric, the market’s functioning, and people’s well-being, regardless of absolute material living standards. It will give weight to the value of diffuse and widespread investment, not just the value of agglomeration. It will consider the benefits that locally owned establishments bring to their communities alongside the benefits that hyper-efficient conglomerates can deliver. It will insist on recognizing the importance of non-market labor performed within the household and community, rather than assuming that the higher monetary incomes in a society of two-earner families must indicate progress.
Conservative economics will also accord equal respect to the concerns of capital and labor, rather than claiming that whatever is best for shareholders in the short run will eventually prove best for workers as well. It will favor collective worker representation that affords real influence in setting the terms and conditions of employment over the fiction that individual employees enjoy the freedom to each negotiate their own terms. It will be aware that cheerfully abandoning the world’s industrial supply chains to Asia was, is, and always will be irresponsible.
Our goal for American Compass is to reassert ideas like these for a conservative coalition that once understood them intuitively, because they are natural outgrowths of conservative principles. America must reorient its political focus from growth for its own sake to widely shared economic development that sustains vital social institutions. We must set a course for a country in which families can achieve self-sufficiency, contribute productively to their communities, and prepare the next generation for the same. All this requires an economic consensus that emphasizes the importance of family, community, and industry to the nation’s liberty and prosperity.
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