By James Kwak
Charles Koch recently made headlines by saying that it is “possible another Clinton could be better than another Republican” in this year’s presidential race. Some people find this surprising: how could the Koch brothers sit by and let another Democrat be elected to the White House? But that’s a reflection less of the Kochs’ political acumen than of our collective quadrennial fixation on the presidential election.
I find it unlikely that the Kochs would actually support Hillary Clinton—it’s more likely Charles was taking the occasion to signal his displeasure with both Donald Trump and Ted Cruz—but it’s quite possible that they will simply sit out the battle for the White House. Unlike, oh, just about everyone in the Democratic Party, the Kochs have never panicked at the thought of losing any particular election. Instead, as Jacob Hacker and Paul Pierson put it:
When conservative business leaders such as Charles and David Koch invested in Cato, Heritage, the American Enterprise Institute, and all the other intellectual weapons of the right, they were playing the long game. When Republican political leaders like Newt Gingrich and Mitch McConnell developed new strategies for tearing down American government to build up GOP power, they were playing the long game.
That’s from the conclusion of their new book, American Amnesia (p. 369).
Since the 1980s, if not earlier, the story of the Democratic Party has been a reasonably successful attempt to take or maintain control over the presidency at any costs—combined with a complete failure to articulate a compelling, long-term vision, or to build lasting networks and institutions that provide the infrastructure for political change. We bet everything on the political skills of Bill Clinton or Barack Obama, and then we act surprised when they end up following moderate Republican policies—in part because they are blocked in by Republicans in Congress, in state houses, and in the federal judiciary. (And for those who think this is hyperbole, it was Bill Clinton himself who said, “I hope you’re all aware we’re all Eisenhower Republicans. . . . We stand for lower deficits and free trade and the bond market. Isn’t that great?” (Hacker and Pierson, p. 163).)
The story of the conservative movement, on the other hand, is the opposite: serial failure to come up with a compelling presidential candidate—since 1988, no Republican nominee has won a plurality of the popular vote, except W. when running as an incumbent after “winning” a war—combined with a consistent vision, a massive advantage in fundraising not dependent on a unique individual (like Obama or Bernie Sanders), repeated victories in state legislative and gubernatorial elections, successful gerrymandering in multiple states, a structural lock on the House of Representatives, and consolidation of the small-state bias in the Senate. Sure, things haven’t been all rosy for libertarian conservatives like the Kochs—there was the huge expansion of government under W., and now Obamacare. But they’ve reduced the chances of higher taxes to nil, they’ve blocked any action on climate change, they have Barack Obama reduced to trying to pass a “free trade” agreement (because he can’t pass anything else), and they’re just one presidential election—now, or 2020, or 2024—from a massive restructuring of the tax code and all social insurance programs.
American Amnesia is a great read, for several reasons. It’s a passionate and fact-based argument for what Hacker and Pierson call the “mixed economy” (what that David Kotz calls “regulated capitalism” in The Rise and Fall of Neoliberal Capitalism), one in which government plays an active role in structuring and supplementing markets. It’s long on American history going back to the Founding Fathers. Not only does it emphasize the importance of everyone’s current favorite founder, Alexander Hamilton, who favored a strong (for his day) federal government; it also shows James Madison to be a proponent of a strong central government, and even describes Thomas Jefferson’s reconciliation to Hamiltonian economic policies. And it’s deep on details of everything that’s wrong with American politics and economic policy today.
I think the best part of the book, however, is its emphasis on the interest groups and ideologues who brought about the current state of affairs. The title of the book refers to the fact that Americans no longer remember that it was the mixed economy that made the United States the most powerful country in the world. But the word “amnesia” is slightly misleading, because it connotes passive forgetting. It’s more accurate to say that the idea of the mixed economy was actively pushed aside by the ideology of all-powerful and universally benevolent competitive markets—what I call economism because of its exaggerated dependence on Economics 101 models, and Hacker and Pierson call Randianism after Ayn Rand.
Like Kotz, and like Cohen and DeLong in Concrete Economics, Hacker and Pierson discuss how something went wrong beginning in the 1970s and especially from the 1980s. (That’s also the inflection point in 13 Bankers, but we were focusing just on the financial sector.) The second part of American Amnesia focuses on several of the actors behind that historical shift. There is future Supreme Court Justice Lewis Powell encouraging American business to become a force for deregulation and small government. There is Newt Gingrich, who hit on the brilliant idea of destroying the reputation of the very institution he inhabited. And, of course, there are the Koch brothers, with that same Charles Koch saying (p. 232):
The most important strategic consideration to keep in mind is that any program adopted should be highly leveraged so that we reach those whose influence on others produces a multiplier effect. That is why educational programs are superior to political action, and support of talented free-market scholars is preferable to mass advertising.
The Friedrich Hayek of “The Intellectuals and Socialism” could not have wished for a better student.
Through it all, the key is that these men were playing the long game—not the short game of trying to win the next election. And they are still playing it. In the long run, what matter are ideas, institutions, and money—not the millions of $25 donations that can make the difference in a presidential primary, but the million-dollar checks that build up think tanks, academic institutes, Astroturf organizations, 501(c)(4)s and super PACs, training courses for activists and local candidates, and all the other infrastructure necessary to build a long-term political movement.
They have it. We don’t. Hacker and Pierson write, “Those like us who believe we can and must build a mixed economy for the twenty-first century—they need to play the long game, too” (p. 369). The more I have studied the development of modern American conservatism, the more I agree. Unfortunately, that’s not how Democrats roll—at least not so far.