A new generation of conservatives says economic populism is the future
On Sept. 27, as more than 20 million Americans were glued to the testimonies of Christine Blasey Ford and Brett Kavanaugh, the mayors of 43 cities–Democrats and Republicans–gathered in a Hilton hotel in Columbia, S.C., for something far less dramatic but possibly even more important. It was a weekend-long session devoted to things politicians and policymakers say they care about but do very little to fix: infrastructure, homelessness and economic renewal. One of the speakers was a 36-year-old “policy entrepreneur” named John Lettieri, a co-founder (together with Sean Parker, of Napster and Facebook fortune and fame, and Steve Glickman, an economic adviser to President Obama) of the Economic Innovation Group. Created in 2013, the group predated the election of Donald Trump. Yet it has become a major player in what could be the next phase of the Trump revolution–one that reaches beyond the President in ways that might change the country for decades after he’s left office.
It begins with the story Lettieri tells about the two parties, at war in so many ways but alike in the mistakes they keep repeating, especially when it comes to the economy. Consider, he says, the seductive but misleading attraction of employment data. On Oct. 5 the Labor Department reported the economy had added 134,000 new jobs in September and the unemployment rate had plunged to 3.7%, the lowest since 1969. That sounds like good news, but for many jobs there’s a shortage of qualified candidates, which hints at something else–the steady degrading of skills and the country’s failure to adjust to the demands of new technology and overseas competition.
Lettieri is a key figure in a band of intellectuals working to build the intellectual scaffolding to support Trump’s movement long after he leaves power. Too few in number to form a movement, they’re also young and as yet not well known, though some wield surprising influence. One reason is they have big ideas. Another is that they have taken a key lesson of Trump’s rise–the rhetoric of economic populism–and are trying to do the unthinkable: turn the President’s impulses into a constructive, long-term effort to reform the American economy. They count among them economists, law-school grads, magazine editors and former Tea Party activists.
Dispersed throughout Washington, clustered in Senate offices–on the staffs of Marco Rubio and Mike Lee, among others–and congregating at think tanks and in small journals, these insurgents are starting to find a warm welcome from a rising class of party voices, including Senators Tom Cotton, Ben Sasse and Tim Scott. They point as well to 34-year-old Representative Mike Gallagher from Green Bay, Wis., a Princeton graduate and former Marine captain who was elected in the Trump wave and promptly joined the leadership of the bipartisan Problem Solvers Caucus.
They’ve already pushed through a child tax credit that gives money back to American families. Some of them worked with Ivanka Trump on a paid-family-leave plan. And they even slipped new economic-opportunity zones to promote investment in distressed areas into the much derided 2017 tax bill. All these wonky-sounding ideas cut across traditional party lines–and some members of the group even say they’re willing to work with Democrats when it comes to things like infrastructure. They have even more ambitious plans to revamp conservative ideas into a new and more humane American right. If they succeed, it may mean the end of the Reagan economic consensus.
These intellectuals are committed to a new economic nationalism no matter what happens to Trump, even if Robert Mueller’s report prompts impeachment proceedings or the President burns out on scandals in 2020. They’re looking past Trump, beyond his nativist rhetoric and Twitter rants, to assert a fundamental truth: whatever you think of him, Donald Trump has shown a major failing in the way America’s political parties have been serving their constituents. The future of Trump’s revolution may depend on whether this young group can help fix the economy.
More than a decade after the subprime-mortgage crisis, which triggered the Great Recession, many of those hit worst are still struggling. The recovery of the Obama years was oversold, and his presidency confirmed for many that the main constituency for both parties, Democrats as well as Republicans is Wall Street. There is much talk of “identity” politics today, but it remains impolite–unless you’re Stephen Bannon or Bernie Sanders–to talk about who, exactly, is falling behind. “Whites, who account for 78% of the labor force, lost more than 700,000 net jobs over the nine years” of the Obama years, the New York Times’ Eduardo Porter pointed out shortly after the 2016 election. “Whites ages 25 to 54 lost some 6.5 million jobs more than they gained over the period. Hispanics in their prime, by contrast, gained some 3 million jobs net, Asians 1.5 million and blacks 1 million.”
It’s not just about race. It’s also about geography. “National numbers are less indicative of local realities than any time in our history,” says Lettieri. The trouble is coming in places where elites tend not to look. Lettieri points to ignored “distressed” regions in the South and Appalachia, not to mention the 209 counties that voted twice for Obama and then voted for Trump. They are not only pins stuck in an electoral map. America’s deepening divide begins in overlooked sources of injury and grief. Look away from the coasts, away from the enclaves of wealth, and observe the absence of the labor market “churn” that acts, he says, “as a kind of shock absorber in times of economic trauma.” Especially for those at the bottom.
All this is prelude to a message of hope. Lettieri travels the country bringing news of $6 trillion in untapped capital and the economic-opportunity zones, one of the few innovative ideas in the 2017 tax bill. The designations allow companies to avoid paying capital gains taxes if they invest or hire in 8,700 opportunity zones across 50 states.
“Is the American Dream alive or dead?” asks Lettieri, who was a foreign policy aide to former Senator Chuck Hagel. “My response: What ZIP code are we talking about? That’s what says most about whether you have a shot at the American Dream. It’s a lottery of birth.” For years, he adds, the problem was “just not being addressed by institutional establishment Washington in either party.” With honest talk like this, Lettieri and company are not afraid of taking on their party’s home truths: “The typical Republican,” one 20-something Hill staffer scoffs, “turns the culture war up to notch 11 to cover up zombie supply-side policy.”
The new wave right is cresting in conservative media too. Not on Fox News or talk radio, but in idea and argument hatcheries. You can find its often erudite commentary in the American Conservative and Modern Age, the surprising left-right combinations thrown by the National Interest, in the almost wickedly contrarian American Affairs and on the website American Greatness. Some in the new cohort are devout Trumpists, some are skeptics, and a few are card-carrying Never Trumpers. All might be termed post-Trumpists, starting from the premise that the forces Trump loosed are here to stay–though not all of them, they hope. Some of the ugliest features are already fading. Remember Richard Spencer, with his 1930s-style “fashy” haircut, his “Hail Trump”? We haven’t heard the last of “alt-right” bigotry, but Trump’s nativism, his attacks on allied countries and his confusion on trade don’t distract post-Trumpists.
What these millennial conservatives emphasize is the distilled lessons of the 2016 election. Primarily: globalization really has led to a system rigged against blue collar workers as they watch factories close and jobs shipped overseas. “Trump’s message resonates because it should resonate,” says Lettieri.
Free trade, too, has come at a cost. “What if China sends $50 billion worth of electronics to the United States and we send $50 billion worth of U.S. Treasury bonds back to China?” asks a new book, The Once and Future Worker. Its author, Oren Cass, has one of the sharpest policy minds in this new vanguard. His pedigree is surprising. In 2012, the year he graduated from Harvard Law School, he was a top policy adviser for Mitt Romney at age 29. He now writes for the Manhattan Institute. “The issue that came up after the 2012 campaign was, What does conservative antipoverty policy look like?” Cass says. He sees Trump as a “cultural marker” and allows that “the problems he put the table were constructive.”
An elder in the group is David Azerrad, a 40-year-old Montrealer with a Ph.D. in politics who teaches at American University and runs an idea shop at the Heritage Foundation, the most Trump-leaning of think tanks. Azerrad differs from others in this group in being heartily pro-Trump. It’s a point of contention with some others. He recently “hashed it out” for three hours with his friend Cass at a Georgetown bar.
“Trump is a lightning rod,” Azerrad says. “He arouses such strong passions, and there’s so much about him people don’t like that it makes it hard to look beyond him to get to the truth, both to the ideas he has–and he does have ideas–and also to the currents he’s tapped into.” Most agree with Azerrad’s prediction about Trumpism. “I don’t think there’s going to be a return to normal once he leaves.”
And what are Trump’s ideas? “A combination of nationalism and populism” or “right-wing nationalist populism,” says Azerrad, well aware they’re loaded terms, especially given Trump’s compulsion to sow discord. But suppose they can be put to more constructive use?
That’s the hope of these conservatives. One proponent is Michael Needham, who is busily a building a new career on the Hill after an Obama-era run as the enfant terrible of Heritage Action, the foundation’s political arm. It was Needham who organized platoons of die-hard “sentinels,” grassroots true believers, many from the Tea Party movement, who exuberantly joined the crusade to defund Obamacare and hounded wobbly legislators unto exhaustion.
But then last spring, Needham gave it up to become chief of staff to Rubio. It meant a shift to making policy happen, rather than around-the-clock obstructionism. The media today favors a dissenter like Jeff Flake, who speechifies against Trump. But when it comes to policy, Flake is supine. Rubio now wants to do something. Needham touts Rubio’s child tax credit and his paid-family-leave proposal. The details were worked out by another millennial conservative whose name comes up frequently: Caleb Orr, a 24-year-old whiz-kid specialist in tax policy who still had a year to go at Abilene Christian University in Texas when he joined Rubio’s staff. “He was the sherpa for the family plan, drafted it and worked with Ivanka’s team,” says a senior colleague. Orr’s talk is salted with a new-age Republican terminology–of “homemaker workers,” of the choices between “neoliberalism and industrial nationalist policy,” blended with the usual policyspeak of “cash transfers” of “low welfare and high wage, instead of redistribution, predistribution.”
The larger question about the post-Trump right is whether they will take their ideas all the way. Are they seriously looking to take the best of Trump and rebuild the party into what Bannon and others say would be a right-wing “workers’ party” whose core principle is economic populism? If they are, this places them directly at odds with decades of GOP doctrine–and against their party’s current leadership and donor base.
Cass’s book, timed for publication the week after the midterms, could either be the battle orders for a second Trump term or a to-do list for a successor stamped in the same mold. There is no mistaking the Trump-inflected themes of nationalism, populism and criticism of free trade. Cass, an alum of Bain & Co.–the progenitor of Romney’s Bain Capital–now wants “to combat the unfair trade practices of nations like China,” which threaten “to reduce opportunities for workers, lower the trajectory of their productivity and diminish the nation’s real prosperity.” He also goes after globalization. Currently “we free employers from the constraints of using the existing domestic workforce,” he writes, “offering them instead an option of using much cheaper foreign workers overseas or bringing the cheaper workers here.” Sanders and Bannon would agree. Cass’s pro-worker policy includes wage subsidies, a standard conservative alternative to raising the minimum wage. Under one proposal the subsidy would act differently, by diverting tax giveaways enjoyed now by the wealthy–for instance, slashing further the mortgage-interest deduction–and sending that money down the economic stream, supplementing the paychecks of families while also reinforcing their work ethic. This could potentially address the problem tucked away in the unemployment numbers–that too many of the able-bodied have drifted out of the job market. The problem of “labor-force participation” is a subject for conservatives like Charles Murray and J.D. Vance. What’s striking in Cass’s argument is its unapologetic Robin Hoodism. He dispenses with homilies about morally educating the poor and instead vows to target the rich, “taking tax revenue drawn from higher earners and inserting it directly into the paychecks of lower earners.”
Cass is less inhibited than most because he’s a free agent. Those in the Capitol Hill contingent have to watch their words–at least in public. But let them speak privately, and they come out slugging. “Look at the tax bill,” said one Senate staffer. “The Republican Party is shrugging. ‘We lost the messaging war.’ No, you didn’t lose the messaging war. The country didn’t want a tax cut.” Not only that. It might want something else. He adds, “I recognize that Americans like things that I oppose, like an increased minimum wage. That doesn’t mean they don’t deserve to get it. The Senate’s supposed to represent them, not the leadership of the majority party.”
In this is the hint–one the millennials don’t dispute–that Democrats might be easier to work with than die-hards in the GOP. “Chuck Schumer was ready to deal with President Trump”–on infrastructure, for one issue. There were policy and personality differences, but had the sides been serious they could have found common ground. Under a more disciplined, transactional President, it could happen. Imagine the heir to Trump who “finds the four or five most popular things the other side is for and tries to couple them with bipartisan compromises,” one senior Hill staffer told me. “That’s a powerful bully pulpit.”
One Capitol Hill aide began our tutorial with a document–a pointillist splash of clustered dots representing voters’ interests, done in two colors, blue and red, a computer-generated Seurat. The dots cluster around a generally conservative cultural agenda and a generally liberal economic one. The winning political combination is there for whoever can strike the right combination. Everyone gets it too–except those who call the shots in both parties. “The donor base imposes the unpopular donor agenda whenever they’re in power.”
Trump has changed that calculation–or could, if he gets out from under his own party’s establishment. These young conservatives are direct about this. “The tax bill, the main achievement, was totally plutocratic,” says one. And all agree on the explanation. As one Hill staffer put it, “Trump has been rolled by [Mitch] McConnell and [Paul] Ryan for two years.”
But then the point isn’t Trump himself. It’s translating Trumpism into an enduring movement. “Yes, policy is lagging behind the argument,” says Cass. “But I would go further and say the argument is lagging behind the rhetoric.”
This is where the writers come in–including an older breakaway group, the reform conservatives–or “reformicons.” All through the Obama years, and even before, reformers like New York Times columnist Ross Douthat and National Review editor Reihan Salam tried to steer the GOP away from the stale dogma of Club for Growth antigovernment tax cutting and onto a new path of problem solving. “Trump is a reform conservative in strategy, if not in the particulars of substance,” Douthat said during the campaign. The dean of the reformicons, Yuval Levin, editor of the quarterly wonkfest National Affairs, saw this too. “People like me who thought Republicans were crazy for ignoring working-class voters? Trump proves it. They were crazy,” Levin said in 2016, when Trump was closing in on the nomination. But undoing the whole structure of the Reagan legacy was too far to go. That structure is being gleefully torn down by American Affairs, founded as a pro-Trump publication. Its Harvard-educated editor, the 32-year-old polymath Julius Krein, has moved away from Trump–Krein renounced his support after the white-nationalist violence in Charlottesville–but continues to publish biting critiques of establishment thinking. “What are defined as global norms,” Krein recently wrote, “are mostly just the (often selfish and parochial) preferences of the powerful–in this case, a relatively thin stratum of Western elites.” As a result, “the more democracy is defended in the name of ‘pluralism,’ the more rigidly moralistic it becomes.” This statement could come from either the far left or the far right. One could imagine Bannon saying it–and also the leftist Slavoj Zizek, who has contributed to American Affairs.
The nearest thing to a prophet of the new movement is Michael Lind, who in the peak Reagan years was one of the right’s most promising young thinkers. But in the 1990s, Lind broke away, mystified that conservatives had let themselves become front men for the GOP, blindly plunging into the moat of supply-side economics. Reaganism created the new Gilded Age, and it is what led ultimately to the revolt under Trump of the Republican base in 2016. Trump’s GOP could implode too. Back then Lind saw a new path in his book Up From Conservatism (published in 1996), which proposed “an inclusive, one-nation conservatism,” but free of both bigotry and meanspiritedness.
“A one-nation conservatism in America would not be a vehicle for white resentment,” he wrote. “Even as they repealed affirmative action and racial labeling as offensive to the ideal of a common citizenship, conservatives with a one-nation philosophy would propose new, race-neutral measures by which the government together with business and communities would seek to help the disproportionately nonwhite poor.” And they would be economically liberal.
Lind argued, “Tomorrow’s one-nation conservatives would not oppose every measure to strengthen the rights of workers or to increase wages and benefits for ordinary Americans as ‘socialism’ or as ‘crippling regulation’ which will ‘destroy jobs.’” It is a vision of what might now be called humane Trumpism–or Trumpism with a human face.
But to get there, the millennial conservatives will need to persuade the base. The trick will be remaking the Republican Party into the right-tilting workers’ party of their dreams without collapsing into a new edition of the culture wars. “We have earned this moment,” Lettieri says.
Whether his party will agree is the big question. To get there they will have to overcome not just the entrenched interests atop the GOP but also Trump’s own brand of chaos and confusion. They’ll have to get beyond the darker protests of the nativist, racist “alt right” that Trump has emboldened. “This is a generational challenge,” says one Capitol Hill millennial. “It’s about ‘build a consensus, get counterproposals,’ having the new people come in and provide new perspectives.”
They have one distinct advantage: they are young enough to see it through.
Tanenhaus, a former editor of the New York Times Book Review, is writing a biography of William F. Buckley Jr.