2014 doomed the reformocons

In March 2013, I wrote a profile for the Washington Monthly of a group of moderate Republican wonks who were looking to change the party's policy direction. We called them "reformish conservatives," while Sam Tanenhaus called them "reformicons" when he wrote a similar piece for The New York Times Magazine with many of the same characters a year later. (The spelling should have been "reformocon," members say.) Wonky, earnest liberals like Danny Vinik, short on reasonable conservative sparring partners, took them seriously.

Two years and an election later, enough has happened to draw some conclusions about the success of reform conservatism. Have they succeeded in changing the GOP's policy orientation?

Nope.

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

The best evidence of this, as Jonathan Chait points out, comes from the evolution of the Rubio/Lee tax plan. In its original incarnation, loudly endorsed by the reformocons, this was a sizable tax reform, weighted towards the rich but not exclusively so, coupled to a big new child benefit aimed mostly at the middle and upper-middle class. As such, it was something of a pivot away from traditional Paul Ryan-style conservative policy of huge tax cuts for the rich and huge cuts in social programs for everyone else, especially the poor.

The hot new Rubio/Lee plan, by contrast (also loudly endorsed by key reformocons), has been larded up with benefits exclusively for the rich: a complete abolition of the capital gains tax and the estate tax. This is a staggering handout to the rich. Currently, 68 percent of the benefits of the capital gains tax are captured by the top 1 percent, while less than 2 out of every 1000 estates pay the estate tax, due to the eligibility threshold of at least $5.43 million.

Meanwhile, the child tax credit aspect of the plan has come under sustained attack. Reformocons justify the credit with something they call the "parent tax penalty," and argue that parents should be compensated for the payroll taxes their children will eventually pay. Matt Bruenig and Elizabeth Stoker Bruenig have been hammering this reasoning for months, since the way the benefit is structured is utterly inconsistent with the reformocons' rationale. If the benefit is supposed to compensate people for their children's tax payments, then it is incoherent to base benefits on the incomes of the parents.

Veronique de Rugy, a non-reformist conservative, agrees with Team Bruenig. She states flatly that there is no such thing as a parent tax penalty, calling it a "brilliant marketing move."

She is beside herself with glee at the pro-rich changes, however. Those parts are just fine and dandy. Her major problem with the new child tax credit is that it eats up valuable budget headroom. Instead, she says (as she has before) that social benefits should be cut, not expanded, so there will be even more money for rich-friendly tax cuts. Perhaps the next version of Rubio/Lee will have a negative capital gains tax?

As an aside, there is no reason whatsoever to think that De Rugy is right that cutting the capital gains tax will improve growth. This is about transfers to the rich, nothing more.

Reformocons had one major policy success that I noted back in 2013: monetary policy. There the reformocons had made major inroads against the inflation paranoia and goldbuggery of the Paul family and their allies. On this, they have not been overturned so much as the issue has faded away. Two years ago, hard money was an open question. But now, with the recovery finally accelerating, both the goldbugs and their conservative critics have largely fallen silent. Now Ramesh Ponnuru, previously one of the monetary doves, cites papers chiding the Federal Reserve for historically allowing too much inflation.

Instead, the arguments for continued monetary stimulus come largely from the left, which has been all but begging Janet Yellen on bended knee to delay rate hikes until inflation actually appears.

In other words: the reformocons' one major intellectual success lies all but abandoned, their one halfhearted attempt to buy off the middle and upper-middle class with a new welfare program has already been adulterated with gallons of 200-proof Reaganomics, and they're still under attack from their own party for being insufficiently pro-rich.

What changed? In 2013, I noted that the reformocons had a tough row to hoe. People like Bruce Bartlett and David Frum had been scourged out of the party for ideological apostasy. John Feehery, a conservative pundit and former staffer, noted that reformocons "are speaking the language of policy," while the base "is speaking the language of hating Obama." Any sort of reformist ideological activism, the logic goes, is going to be tough in such an environment.

A simpler and more convincing explanation, however, is that Republicans won the 2014 elections. That has dramatically undermined the perception that the party needs to change anything to win back the presidency in 2016.

With the memory of George W. Bush's gruesome failure of a presidency fast receding in the distance, they might even be right about that. But one thing is fairly certain at this point: if a Republican wins in 2016, don't expect Mike Konczal to revise his view of the conservative policy consensus from two years ago. If any reform comes, it will be after another serious loss, no earlier.