I enjoyed my time here in the Swampland this week; thanks again for the invitation. I wanted to leave you all with my thoughts on political trends over the next two years.
I would not expect any meaningful bills to come off of the Hill as the presidential primaries will overshadow any serious legislative efforts. Immigration reform may be the first victim.
Democrats will probably try and shore up their base heading into the 2008 cycle with votes on issues such as card check and other topics with a high demagoguery coefficient. Look for plenty of attacks on oil companies in one breath and pursing policies that will drive up energy costs in the next.
I also expect a slow and steady expansion of government and tax increases. One example is the proposal in the Senate to raise the federal excise tax to expand the SCHIP entitlement program. I also worry that President Bush will take a bad deal on Social Security that cuts benefits and raises taxes. He will take all the blame and Democrats will get to claim they saved Social Security while we and our children pay more for an inferior retirement program.
Political cycles and trends favor the Democrats heading into the 2008 federal elections.
No matter who is the eventual Republican nominee, Hillary Clinton seems unstoppable right now. (I will be following the presidential race here) Without a miraculous change on the ground, the war in Iraq will continue to drag on Republicans.
I believe 2008 will be the year of the pocketbook voter. This critical block of swing and independent voters that cares about policy and not politics will be looking for answers to issues like rising energy and health care costs and worrying about the weakening housing market. They also increasingly feel insecure about their retirement and do not trust that Social Security will be there as promised.
Voters will take bad ideas on these issues over no ideas. I fear that a dispirited Republican party will fail to appeal to the pocketbook voters by not advancing a specific agenda to deal with these big issues. The strong headwinds could lead to a further erosion of the Republican Party in the both the House and especially the Senate, where 21 Republican Senate seats will be contested in 2008.
With larger Democrat majorities, there will be little to stop left wing energy and health care proposals. We can expect attempts at massive expansions of government in energy and health care. Al Gore’s dream to outlaw coal-burning power plants and the incandescent light bulb will go hand-in-hand Hillary’s lifelong goal of socialized health care.
One need only look back to the 1970s to see where this would lead us. Excess government will lead to higher taxes, and not just on the ’rich.’ New programs and the additional constraints imposed by retiring baby boomers will need to be financed, and higher taxes will slow the economy, potentially returning us to the malaise of the 1970s.
The hope lies in the Young Turks of the Republican Party, those who treasure individual and economic freedom. I look for the next Reagan, the person who will unify the party, appeal to swing voters, and roll back government. This person is most likely to emerge from the Republican Study Committee in the House or the Senate’s Freedom Caucus.
I leave you with this: the fundamental issue here is whether we need more or less government control. John F. Kennedy (a supply-side tax cutter) pointed out that it is more important to ask what you can do for the country, not what the country can do for you. When it comes to health care and energy policy, it seems we are only asking what government can do for us. That of course, is the road to serfdom…the misplaced hope that our politicians and their promises can solve our nation’s problems, rather than relying on the creative effort and industry of free men.