Three Paradoxes of American Politics, Part 4

After the 2012 election, I posed three paradoxes of American politics, asking why certain demographic groups make up reliable voting blocs for the left, even though the pro-free-market ideas of the right have so much to offer them.

I have been addressing these paradoxes one by one, from the first paradox, why young people vote for the political equivalent of moving back into mom’s basement, to the second paradox, why racial minorities embrace a party which treats them with such condescending paternalism.

Now let us look at the third paradox: Why do the great centers of wealth and commerce, the cities, vote for the party that is hostile to wealth, commerce, and money-making?

In the first installment of this series, I linked to a map that takes the usual county-by-county map of the 2012 election results and weights it for population, so that the cities don’t just show up as blue, representing votes for Obama; they show up as deep wells of dark blue, showing how urban centers helped tip the election.

As I pointed out, we are used to cities being lost to the Republican vote, but it is actually a relatively recent phenomenon. In their landslide victories in 1972 and 1984, for example, both Nixon and Reagan won a majority of votes in Manhattan.

And then there is the longer history on this issue. A while back, I came across a curious story about a populist rebellion among radical New York City Democrats. The story is that they were so determined to push their radical agenda that they tried to take over a Democratic Party convention in New York City. The party establishment tried to shut them down by turning off the lights in the meeting hall, but the radicals continued by candlelight. The faction became known by the brand of the matches they used to light the candles. They were called the Locofocos.

The year was 1835, the party establishment was the corrupt Tammany Hall gang, and what was the agenda of these radical New York City Democrats? Laissez-faire. “Made up primarily of workingmen and reformers, the Locofocos were opposed to state banks, monopolies, paper money, tariffs, and generally any financial policies that seemed to them antidemocratic and conducive to special privilege.”

The faction faded after achieving one of its main objectives: the “Independent Treasury System” that separated the US Treasury from the banking system, preventing it from manipulating the money supply and inflating speculative bubbles. Many of its adherents moved on to their next big cause, abolition of slavery, and would form the core of the new Republican Party.

In response to the modern-day Republican Party’s stinging loss in the 2012 election, there has been a lot of debate about how to reform the party and its agenda. One of the rising alternatives has taken the name “libertarian populism.” It’s not the best name, because neither term is quite accurate. It is not quite libertarianism and not quite populism. But it is shorthand for the idea that free markets benefit everyone, including and especially the poor. As I put it, “You can think of it as a reaction against Romneyism: instead of writing off the ‘47%’ with lower incomes who are the targets of government largesse, the idea is to appeal to these people and try to convince them that they, too, will benefit from free markets and smaller government.” Specifically, “libertarian populism” focuses on attacking the way that government intervention in the economy tends to provide special privileges for the politically connected, such as “too big to fail” banks.

Which is to say that if you want to find a model for contemporary “libertarian populism,” you couldn’t do better than to draw on the history of the Locofocos.

What is most relevant about the Locofocos for our present purpose is that they were a city faction. A radical New York City Democrat today would be a socialist hanging around with the “Occupy Wall Street” crowd. (Or the incoming mayor of the city, who spent the 1980s as a shill for the Communist regime in Nicaragua.) But in 1835, radical New York City Democrats were advocates of laissez-faire. What changed? How did free market ideas lose the support of the cities, and how can today’s right gain them back again?

The cities’ turn to the left is partly explained by the previous paradoxes we have already addressed. Cities tend to contain a disproportionate number of young people and racial minorities, so the Democratic Party’s death-grip on those demographics is naturally going to turn the cities to the left.

And while the cities are great centers of wealth and commerce, many of the people who drive that commerce don’t actually live in the cities. The middle-aged, middle-class middle managers who provide much of the productive core of the work force may go to their offices in the city, but at the end of the day, they hop on a train and head back to their homes in the suburbs.

The classic progression by which young people end up turning to the right is that they graduate from the liberal utopia of college, get a job, get married, have kids—and become conservative. This is confirmed by polls which show that marriage and parenthood, especially marriage, are key markers for right-leaning views.

And somewhere along that progression—get married, have kids, become a conservative—there is another step: move to the suburbs. This is why the suburbs are not in the death grip of the left and tend to be the true “swing” districts in recent elections. In fact, a key marker for Republican voting patterns is the affordability of homes with yards, which are generally considered a prerequisite for marriage and children.

But the question remains. How did the right lose those who remain in the cities, both the poor and the urban sophisticates? The Locofocos were described as representing a coalition of “workingmen and reformers.” How can the right build such an urban coalition today?

Let’s start with the “workingmen,” the urban poor and lower middle class.

Contrary to Mitt Romney, this “47%” is not inevitably compromised by dependence on government. In fact, polls indicate that the values of the lower middle class are not so different from those of the better-off.

If anything, less-affluent Americans are more convinced of the importance of work than are more economically successful Americans. A 2008 Pew study found 69 percent of low-income Americans agreeing that “being successful in a career” was very important to them personally, compared with 58 percent of upper-income Americans.

Lower-income Americans also place greater importance on a wage earner being able to support a family financially than do affluent workers…. Most high-, middle- and low-income citizens share the same concerns about becoming too dependent on government, and have the same worries about the state of the American work ethic.

To be sure, there is still a gap between the poor and the middle class on certain key issues: “Those in the lowest quartile of household income—earning less than $20,000 a year—are twice as likely as those in the highest quartile to say that ‘hard work offers little guarantee of success’ (46 percent versus 23 percent).” But what is interesting is that these numbers are not sufficient to explain the actual gap in political leanings. This is an audience that is more open to an individualist, pro-free-market perspective than is usually acknowledged.

Nor is there any inherent reason why the lower-middle-class “workingman” should inherently believe he benefits from big government. One left-leaning writer cites the “real reason” the inhabitants of big cities lean toward big government.

Cities…are fundamentally about the shared commons. If you live in a city and you think government–and other people–should stay out of your life, how will you get to work in the morning? Who will police your neighborhood? Where will you find a public park when your building has no back yard?

Put aside for a moment the question of what percentage of the trillions spent by federal, state, and local governments actually goes to pay for police patrols, bus routes, and public parks. (Hint: It’s very low.) The more glaring fact is that city dwellers also encounter to a much greater degree the pathologies of big government in all its intrusive incompetence.

The great standing example of this is, of course, Detroit. I recently linked to a photo essay on that city’s desolate post-apocalyptic landscape. Few cities have been more fully under the sway of big-government Democrats and the labor unions, and few have been more fully devastated without actually being invaded by a hostile power.

We must acknowledge, though, that Republicans are to some extent victims of their own success, because outside Detroit, many cities suffer from fewer or less obvious pathologies than they did a few decades ago. Back when New York City went for Nixon and Reagan, one of the grievances that damaged the national reputation of Democrats was the city’s out-of-control crime and dysfunctional administration. But with violent crime rates at historic lows—thanks largely to policies backed by the right—this is no longer an issue. (For now. Stay tuned to see what happens under the incoming mayor.)

But the right’s problem wasn’t that they lost crime as an issue. It was that they didn’t successfully move on to crusade against other big-government pathologies.

There are plenty of targets. Ed Glaeser of City Journal, a publication that played a big ideological role in New York City’s revival, provides a good list that includes reform of the public schools, privatization of city services, loosening of zoning and permit restrictions that drive up housing prices, and of regulations that make it harder to start a business.

For example, what was one of the key factors in Detroit’s downfall? High city taxes.

Recently Dave Helling of the Kansas City Star looked at the variables at play in Motor City’s economic collapse as a point of comparison for Kansas City, Mo. His conclusion? Detroit’s earnings tax structure may have been a key factor in its loss of high wage earners. According to Helling, the tax incentive for workers to move to the suburbs has led to a “vicious cycle of collapse.” From 2000-2010, the metro areas with the largest declines in population (excluding New Orleans, post Hurricane Katrina) were Detroit (-25%), Cleveland (-17%), Cincinnati (-10%), Pittsburgh (-8%), and St. Louis (-8%). Each of these aforementioned cities have an earnings tax.

So Detroit killed itself partly by driving away high earners, essentially paying them to move out of the city. That leads us back to the other end of the old Locofoco coalition: the educated, middle-class “reformers.”

This, by the way, is a key problem with the new push for “libertarian populism,” because it implies that the right only needs to appeal to the poor. Joel Kotkin refers to it as class warfare for Republicans. But advocates of limited government should be competing for the educated upper-middle-class and entrepreneurial elites, too.

It’s easy to deride this as “hipster outreach,” and part of the challenge will be overcoming a natural distaste for the urban elites. For decades, the real Republican populism has been a cultural populism that purports to speak for the heartland and for traditional values and rails against the corrupt cultural elites in Hollywood and Manhattan.

It’s true that a big part of the reason cities tend to the left is that they tend to be centers of influence for the “intellectual” class, where the latest “modern” and “progressive” ideas propagated in the universities are given credence.

Historically and globally, this isn’t always a bad thing. During the Arab Spring, I noted this in a response to a question from a subscriber. “In America, the intellectuals are generally worse and our traditional values are better. In the Third World, the intellectuals (who tend to be conduits for Western values) are better and the traditional values (such as unformed Islam) tend to be much worse.” So in Cairo and Istanbul, educated urban elites really are “progressive.” In today’s New York City, not so much.

While it is tempting to dismiss hipster elites as pretentious bohemian hippies, they are often very productive. But they are more motivated by a self-conscious “idealism” than by economics. Striving lower- and middle-middle-class workers and small business owners feel the effects of taxes and regulation acutely and personally. Upper-middle-class professionals, who make comfortable incomes and usually don’t have to run their own businesses, feel they can afford big government. So why not be benevolent and “compassionate” and vote for it?

A microcosm for how the Republican Party lost urban elites is the story of how it lost Asian-American voters.

Politically, Asians don’t act like a racial minority as such. They act like an economic and educational demographic. They spent one generation rising up as scrappy small entrepreneurs, and they acquired the political leanings that go along with that, magnified by the fact that many of them escaped from Communist regimes and were attracted to the party that most vigorously opposed Communism in its foreign policy. But then the next generation became college-educated elites and acquired the political leanings that go along with that.

These days, the GOP strikes Asian-Americans, along with many other Americans, as hostile to science and modernity…. Apparently, a low-taxes-only agenda is no longer enough to woo a demographic whose median household income exceeds $90,000 by the time that they become third-generation Americans….

[A] majority of Asian immigrants hold at least a college degree—compared with less than one in three members of the overall adult population. At Cal Tech—where race, ethnicity, and legacy status are excluded from admissions criteria—Asian-Americans comprise nearly 40 percent of the student body. At MIT, which professes a commitment to diversity, Asian-Americans comprise more than a quarter of students.

What’s more, Asian-American students tend to concentrate in the STEM jobs—sciences, technology, engineering, and mathematics—that are crucial to our economy. Thus, in a sense, Asian-Americans are not just another ethnic group waiting for a politician to march in a parade, eat some exotic food, and then announce a community grant or shill for votes. Rather, they are also a subset of high-tech America, and one thing is clear: high-tech America is not in love with the Republican Party.

This is the cost of cultural populism. It’s like the Southern Strategy of pursuing Southern White voters at the cost of ignoring and alienating black voters. Thus, a left-leaning commentator pointed out one of the problems with Republican Joe Lhota’s unsuccessful campaign for mayor of New York City: the total absence of Republican institutions in the city. In trying to pander to religious voters in the heartland, the Republicans have alienated and abandoned educated voters in the cities.

In the old Locofoco coalition of workingmen and reformers, the urban elites think of themselves as being the reformers. So advocates of limited government have to convince them to back a truly progressive reform agenda.

This is partly a matter of looking for specific causes to campaign on. As City Journal‘s Ed Glaeser put it, “The main reason that cities succeed is private entrepreneurial energy. Yet many of our cities continue to impose arcane rules on would-be entrepreneurs, restricting the formation of new businesses.”

For example, free marketers could campaign against New York City’s hostility toward technological innovations like Airbnb and Uber, the ride-sharing service that is being blocked because it competes with existing city monopolies. That leads to this arch comment from one technology columnist: “Despite Bloomberg’s best efforts to redefine the city’s image as a tech hub in tune with Silicon Valley-style innovation culture, it’s New York’s fabled history of machine politics and protection rackets that come to mind.”

Similar complaints come from those trying to find a place to live in San Francisco, or in response to attempts to crowdfund neighborhood real-estate development. Given the record of government controls as an impediment to innovation, the mystery is why big government is so popular among those who view themselves as being on the cutting edge of technology.

The most interesting and hopeful advice on how to reclaim these elites is a case study on the revival of the Scandinavian right, which was achieved precisely by winning over intellectual and cultural elites.

In Sweden, students and the intellectual elites turned toward the Left in the 1960s, just as they did the United States. This helped the Left capture the commanding heights of public life, such as the media and the universities, advances that played an important part in prolonging the long era of social democratic dominance.

However, the Swedish Right has increasingly managed to recapture the support of a large segment of the chattering classes. Remarkably, a recent study of Swedish social scientists found that the Right holds a slight advantage over the Left; as the researchers note, this stands “in sharp contrast to the United States.”

This shift did not happen by chance. Starting in the 1980s, the intellectual foundations of the Swedish Right were largely rebuilt by new (US-inspired) think tanks. The Right successfully repositioned itself politically in the early 2000s.

This resulted in two straight election victories for the Right, victories won on a platform of significant tax cuts and reductions in entitlements.

What kept the right from winning over elites earlier?

Conservative policy is often based on tradition. If we believe that culture develops in an evolutionary way, traditions may embed valuable knowledge, the ‘wisdom of the ages,’ which should be followed regardless of if we are currently able to articulate explicit rationales for them. Edmund Burke’s and Friedrich Hayek’s insights were that traditional institutions tended to work better than social engineering rooted in liberal social science.

The problem for American conservatives is that today’s educated voters have been trained to demand a stated intellectual foundation for a given position….

In economic policy, the Right was forced to create a theoretical and empirical foundation for its belief in traditional American capitalism before socialist arguments could be combatted successfully. If our traditional institutions are indeed advantageous and worth preserving, we should typically be able to demonstrate this using the “scientific” language of social science.

I should point out that this overstates the extent to which the right lacked an intellectual foundation, particularly in free-market economics, which was very well established more than a century ago. It also overstates the extent to which left-leaning elites are actually interested in having a rational intellectual foundation. In my experience, a lot of the leftism of the elites is driven by social conformity.

But the more fundamental point is that the right needs a secular philosophical foundation. It needs rational, secular arguments that are convincing to an educated audience that is not content with appeals to tradition.

The big irony of the left’s grip on the intellectuals is the fact that socialism is not scientific, empirical, high-tech, forward-thinking, progressive, or even particularly compassionate. It is a dogma maintained in the face of a century of contrary evidence. From Athens to Detroit, the welfare state is collapsing all around us, but the left has become reactionary, seeking to defend entrenched institutions and protect the prerogatives of special interests.

For precisely this reason, overcoming the prejudice of the educated elites is going to be a long and difficult task. But we are currently presented with the best opportunity in decades.

If we wanted to demonstrate that the policies of the left are not really scientific and high-tech, the most obvious demonstration we could ask for is a massive reform of the health-care system that is totally dependent on a website—which the progressive, scientific planners cannot successfully manage to build. Over the longer term we are about to discover how, rather than reforming the system to provide better health insurance, government regulations are smashing the system to pieces and taking away our health insurance.

The biggest danger of the next year is that the ObamaCare disaster will distract the right from the task of internal reform. By making it much easier for Republicans to pick up seats in the next midterm election, it will reduce the right’s sense of urgency.

Yet the collapse of ObamaCare is actually the best vehicle for reforming the party’s message and approach. Teaching the lessons of ObamaCare is the opportunity for reform and outreach. For the poor, this is an opportunity to teach them about the callous “compassion” of the statists, who promise help but deliver dependency on an intrusive, incompetent central government. For the elites, this is an opportunity to teach them that there is nothing modern, sophisticated, or idealistic about making everyone into a ward of the state.

If you think this is impossible, readers may remember that I’ve been documenting the conversion of Paul David Hewson, known as Bono, a liberal humanitarian who has honestly confronted the evidence about poverty and prosperity in Africa and has begun, in his own words, to “preach capitalism.”

Shortly before the era of the Locofocos, Alexis de Tocqueville visited America and described the prevailing doctrine of “self-interest properly understood,” a form of free-market individualism. He remarked, with some surprise, that “you hear it as much from the poor as from the rich.” That is the goal we need to strive for: that an individualist philosophy and the benefits of the free market will be universally understood and become the common cause of “workingmen and reformers.”

Eventually, perhaps the radical reformers in the big cities will drop their reactionary liberalism and embrace the truly radical reform which is the free market.

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