Re­dis­cov­er­ing the Rea­gan-Kemp vi­sion

The malaise of Obama’s Amer­ica could give way to a new era of growth

The Washington Times Weekly - - Front Page - By Richard W. Rahn Richard W. Rahn is a se­nior fel­low at the Cato In­sti­tute and chair­man of the In­sti­tute for Global Eco­nomic Growth.

What is the Repub­li­can Party’s vi­sion for Amer­ica? You may have a hard time an­swer­ing other than “not Pres­i­dent Obama and his poli­cies.” Most Repub­li­cans plan to run their fall cam­paigns fo­cus­ing on the Obama scan­dals — ad­mit­tedly a tar­get-rich area — with scan­dals in­volv­ing Oba­macare, Beng­hazi, the In­ter­nal Rev­enue Ser­vice and Vet­er­ans Af­fairs. All of this is not a vi­sion of the fu­ture, though. It is hard to build a con­sen­sus — but smart, strong-minded in­di­vid­u­als in the past have been able to ar­tic­u­late a vi­sion that at­tracted not only the pub­lic but other politi­cians. Ron­ald Rea­gan ac­com­plished this, and he was for­tu­nate to have a vi­sion­ary eco­nomic evan­ge­list by his side who helped shape much of the Rea­gan pro­gram and be­came its prin­ci­pal sales­man. His name was Jack Kemp — who passed away five years ago.

Kemp later sought the pres­i­dency, but it es­caped his grasp. As a for­mer pro­fes­sional foot­ball quar­ter­back, he was bet­ter at for­mu­lat­ing a win­ning strat­egy and pass­ing the ball than scor­ing him­self. This past Fri­day, the Jack Kemp Foun­da­tion held a fo­rum at the Lin­coln Cot­tage in Wash­ing­ton on “The Fu­ture of the Amer­i­can Idea.” The many noted speak­ers re­minded us that Jack (be­fore Newt Gin­grich) was the Repub­li­can Party’s and, in many ways, the na­tion’s, leading idea man.

In the 1970s as a ju­nior mem­ber of Congress, he sought to iden­tify the so­lu­tions to the Carter “malaise” of no-growth and high in­fla­tion. He found the so­lu­tion in the writ­ings and speeches of two re­mark­able econ­o­mists — Bob Mun­dell (who went on to win a No­bel Prize) and Art Laf­fer (of the Laf­fer Curve fame). Their pre­scrip­tion was ma­jor mar­ginal tax rate cuts to spur eco­nomic growth and sound money — and if not a re­turn to gold, at least a turn-off of the mon­e­tary flood — to stop in­fla­tion. Kemp, a most en­er­getic and ar­tic­u­late speaker with the enthusiasm of a re­vival preacher, sold the vi­sion wher­ever and when­ever he was al­lowed to speak. Rea­gan agreed with the tax pro­gram and largely adopted it as his own. Rea­gan would quip to us young econ­o­mists that he did not have to un­learn Key­ne­sian eco­nom­ics, for he “had ob­tained his de­gree in eco­nom­ics be­fore Keynes wrote his book.”

Jack Kemp was ob­sessed with eco­nomic growth. He cor­rectly saw it as the ma­jor so­lu­tion to the lack of op­por­tu­nity that many young people, and par­tic­u­larly black Amer­i­cans, faced. Many on the left claim they want to help the poor, but Kemp un­der­stood that to en­able the poor to ob­tain jobs and climb the lad­der of suc­cess, it is not wise to pe­nal­ize the job cre­ators with high mar­ginal tax rates on work, sav­ing and in­vest­ment. “You can­not love the em­ployee and hate the em­ployer.” Un­like most Repub­li­cans, Jack knew how to com­mu­ni­cate with both blue-col­lar work­ers and those who had lit­tle hope.

Even though there are now a num­ber of Repub­li­cans with pres­i­den­tial am­bi­tions and a growth mes­sage of lower tax rates, fewer reg­u­la­tions and less govern­ment spend­ing, none are as com­pelling or bold as was Jack Kemp in his prime. Too many Repub­li­can tax re­form­ers have al­lowed them­selves to get trapped in “static” rev­enue scor­ing, which means that any tax re­form is likely to be per­ceived as hav­ing as many losers as win­ners — a non-starter. In con­trast, Jack Kemp shaped re­al­ity rather than give into the con­ven­tional wis­dom of the time.

Those on the left could never ad­mit that Rea­gan and Kemp were re­ally smarter than many of those with the Ivy League de­grees, so they were both sub­ject to end­less ridicule as know-noth­ings. Re­mark­ably, nei­ther one seemed much both­ered by all of the ver­bal abuse, per­haps, be­cause they knew that they would ul­ti­mately be proved right, which they were. Both were con­fi­dent in their own val­ues and also un­der­stood that most Amer­i­cans had sim­i­lar val­ues.

Repub­li­cans who are run­ning for of­fice this year would find it use­ful to lis­ten to record­ings of many of Kemp’s and Rea­gan’s speeches, be­cause they knew how to com­mu­ni­cate big ideas to the aver­age per­son. The con­tent of the speeches needs to be up­dated, with a much greater fo­cus on re­duc­ing govern­ment spend­ing (a prob­lem to which Kemp paid too lit­tle heed).

Even so, Jack Kemp was a true vi­sion­ary. He knew that if the shack­les of op­pres­sive taxes and reg­u­la­tions were re­moved from the en­tre­pre­neur, in­vestor and worker, most any­thing could be achieved. He ar­tic­u­lated the ben­e­fits to Amer­ica of hav­ing more hard­work­ing and ed­u­cated im­mi­grants. He had tra­di­tional val­ues and was very much an in­clu­sive op­ti­mist. The na­tion’s cur­rent pes­simistic mood calls for ra­tio­nal and op­ti­mistic can­di­dates like Ron­ald Rea­gan and Jack Kemp who can pro­vide a clearly stated, non-tech­no­cratic, bold vi­sion of how to achieve greater op­por­tu­nity for all Amer­i­cans.


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