A governing philosophy for the twenty-first century by Daniel McCarthy
What has been known as conservatism in the Republican party since Ronald Reagan left office, fully thirty years ago, has become inadequate. This has been evident for a while, though we’re only now noticing. From the Great Recession and loss of manufacturing jobs to perpetual war in the Islamic world and intensifying culture war at home, conservatism as the GOP understood it over the last few decades was not only not the answer to our woes but was in many cases their cause. Thus our present moment: Post-Reagan conservative intellectuals soldier on in think tanks and on opinion pages, but conservative voters are abandoning the cause.
Donald Trump’s program when he arrived on the national scene four years ago was in almost every respect the opposite of conservative orthodoxy: on trade, on the Iraq War, on the need to apologize for politically incorrect utterances (and sometimes worse). Yet Republican voters preferred Trump over the paragons of every major conservative faction in the 2016 primaries: the latest establishment Bush; the neocon of the future, Marco Rubio; the libertarian Rand Paul; Ted Cruz, the movement conservative’s conservative; and every other flavor. Those who claimed that Trump only won because the field was so divided overlooked the obvious. If post-Reagan conservatism was satisfactory, there should have been a plurality for any one of its champions, not for the candidate who campaigned like a Nixon Republican.
So now conservatism is in flux. There are those who still insist on the old formulas. There is the Trump administration, with its inevitably imperfect implementation of his campaign agenda. There are Trump imitators, mostly unsuccessful so far. And there are a great many politicians and policy minds attempting to combine something of Trump with a traditional post-Reagan Republican program. Which way is a conservative to choose, with eyes on the good of the country, not just on the success of a faction?
We need a conservative agenda fit for the twenty-first century, and the closest thing to it is in fact the program that follows through on the themes of Trump’s 2016 campaign with greater clarity and focus than the administration itself has so far done. This is not because Trump now defines conservatism, as his detractors allege when they complain about a cult of personality. (Trump has no more of a cult than his last two predecessors did, and less of one among professional conservatives than the deified Reagan.) Rather, Trump in 2016, whether consciously or not, drew upon what has been the clear policy alternative to the elite consensus in favor of global liberalism since the early 1990s: economic nationalism, and nationalism more generally. This is an honorable tradition whose roots in the Republican party run all the way back to Abraham Lincoln. So successful was the economic nationalism pursued by America in the twentieth century that we could afford to deviate from it during the Cold War for the sake of strengthening allies like West Germany, Japan, and South Korea—and even Communist China, an ally of convenience against the Soviet Union. But when the Cold War ended, our economic policy, no less than our foreign policy, should have taken a turn back toward the national interest over building a liberal world order. Trump’s essential appeal to voters was his promise to do just that. He is not an aberration; he is not even a second, more successful Pat Buchanan. He is a return, in however haphazard a fashion, to the policy orientation that once really did make America great and the GOP grand.
Economic nationalism is not just about tariffs. It is less about “economic” than it is about “nationalism”—that is, it takes account of the different needs of different walks of life and regions of the country, serving the whole by serving its parts and drawing them together. In the past, the challenge was to harmonize farmers, urban capital, and labor. The challenge now is to balance those groups with the post-industrial classes as well, and to strengthen the productive economy against the largely fictional economy of administrators and clerks. All of this is for the sake not just of prosperity, in raw dollar terms, but of a national economy that provides the basis for a healthy culture in which citizens and their families can flourish.
Culture comes first—but like a final cause or end in Aristotle’s philosophy, it is first in priority, not necessarily first in time or action. We need to bring this truth forward, for we’ve forgotten it over the past few decades. This is the first of your three free articles for the month.
Conservatives have long believed that politics is downstream from culture, as Andrew Breitbart liked to say. Variations on the idea go back at least as far as Irving Babbitt, who was a rare conservative on the faculty of Harvard College even in 1924, when he wrote that “the economic problem will be found to run into the political problem, the political problem in turn into the philosophical problem, and the philosophical problem itself to be almost indissolubly bound up at last with the religious problem.”
Babbitt meant that the class conflict of the nineteenth century, still very much alive in his day, was symptomatic of something deeper. Breitbart in turn meant that the cultural contexts created by news and entertainment media—by the storylines they script and the emotional cues embedded within them—largely define the limits of the possible in politics. These two views combine in the conviction that culture, in both the social and spiritual senses, takes precedence over politics or economics.
As important as that truth is, it is easily misapplied. In practice it has meant that conservatives emphasize certain “cultural” forms of argument without seriously confronting the hard questions of politics or economics—as if worldly matters will take care of themselves if only our rhetoric is elevated and our intentions pure. Sometimes this leads to a politics of cant. Sometimes it leads to political quietism or a drift toward literary utopianism. And sometimes it just leads to ham-fisted attempts to produce “conservative” films or other forms of popular culture, in which the political message is almost always more conspicuous than the artistic merit.
Cultural, philosophical, and religious assumptions suffuse public life, and in that sense politics is indeed downstream from culture. One can even go further and say that culture, broadly understood, is the riverbed of politics, setting the course along which it flows. But that course is checked and channeled by willful human activity—by building dams and canals, as it were. How this is done turns largely on economic questions, or rather questions of what used to be called political economy. Different kinds of political economy not only produce different dispensations of wealth and power but also profoundly shape family life, individual character, and the civic landscape. A political program therefore has to be an economic program, not just in the superficial sense of dealing with subjects like taxes and regulation but in the deeper sense of relating the nation’s economic way of life to its cultural fabric and the very conditions of its existence.
The underlying structure of American life should not be questioned at every election. But it does need to be considered anew when dramatic changes have taken place in the world or at home. Our present predicament is the result of letting political thought run on autopilot for too long. Donald Trump’s rise, and the rise today of an invigorated socialism in the Democratic party, are signs that conventional politics had failed because conventional politics was built upon an economic order that has ended without its advocates even realizing it.
There are times in a nation’s life when the terms of its politics are settled. Rival parties might disagree about how to achieve certain goals—winning the Cold War, increasing GDP, reducing crime—but they agree on the overall story of politics and frame their proposals in light of it. Republicans and Democrats shared a story throughout the latter half of the twentieth century and into the twenty-first, just as Britain’s Conservatives and Liberals shared a story in the latter half of the nineteenth century. Benjamin Disraeli never brought back the Corn Laws, just as William Gladstone never contemplated disestablishing the Church of England or abolishing the monarchy. Ronald Reagan said he wanted to conserve the New Deal, while Bill Clinton—after losing a bruising battle over national healthcare—decided to go no further and announced that “the era of big government is over.”
In foreign policy, both Republicans and Democrats still talk about “American leadership.” Even in cultural politics, stark differences in policy can be framed within the same narrative: Abortion is usually about individual rights, for example, whether a woman’s or the unborn’s. For many conservatives, the alternative to accepting same-sex marriage a decade ago was to propose domestic partnerships for same-sex couples. The details matter, and they can be matters of life or death. But even the gravest questions can often be addressed within a shared idiom.
Yet there are times when a nation faces a fundamental choice about its nature and direction. The choice between an agrarian and aristocratic or a commercial and bourgeois political order confronted both Britain and France in the late eighteenth and early nineteenth centuries. Americans too had to choose between agrarian ideals (belied by the reality of slavery) and industrial development at several points between the Constitution’s ratification and the outbreak of the Civil War. In the early twentieth century, the relevant choice was between unreconciled class struggle, of the sort that had been going on for nearly a hundred years, or the imposition of a new settlement upon labor and capital alike—the mixed economy.
America is now at another moment of choice. The class compact that came out of the Great Depression and World War II stabilized many of the social tensions dating back to the very beginnings of industrialization. It has broken down. The welfare state is heading toward bankruptcy. Americans are increasingly working as contractors rather than salaried employees, with fewer benefits and less security. Industrial jobs are vanishing. A family wage, lifelong work, retirement guarantees, and brighter prospects for one’s children and grandchildren are not part of the bargain anymore. Economic growth is concentrated in cities and college towns, leaving everyplace else to wither. If the country continues on its present course, all of this will get worse.
Until 2016, however, both major parties continued to campaign as if the class compact of the twentieth century still held sway. Conservative Republican policy ideas were limited to keeping federal spending in check—in theory, if never in practice—and cutting taxes and regulations, while looking for novel ways to continue providing the benefits Americans had come to expect: by privatizing Social Security, for example, or mandating the purchase of private health insurance (Mitt Romney’s idea before it became Obama’s). Progressive Democrats simply planned to have the federal government spend more to keep the welfare state expanding indefinitely. Though just as Republicans could spend as freely as Democrats, Democrats experimented with Republican solutions for making the welfare state more affordable or acceptable to business. Obamacare was one result.
These policies, whether right or left, can no more save the class compact of the twentieth century than farm subsidies could save the agrarian ideal. They may or may not be totally useless in their own right. But they are beside the main point. The American economy has changed in ways that require a new choice about the kind of country we are.
Up to now, the choice has been made by default. Leaders in both parties, in corporate America and in the academy and media, have assumed that what worked twenty or thirty years ago will continue to work today. The reigning assumption has been that politics should focus on fine-tuning the private and public sectors to provide the growth, opportunity, and security Americans have come to rely upon. A tax cut or a new entitlement is all we need. But the America of the twentieth century was a country in several ways profoundly different from the one we inhabit today. It had strong community ties supplied by religious and ethnic groups. It had a powerful private-sector labor movement. Its economy was localized, not globalized; where an industry was located mattered. America exported goods to the world—enjoying a trade surplus as late as 1975—and manufacturing was at the heart of the economy (though it was never the largest employer). In Europe the class bargains that tamed the strife between labor and capital characteristic of the nineteenth century put primary emphasis on the welfare state, but in America the welfare state was secondary. More important was the reigning political economy’s promise of a vigorous private sector that would provide prosperity and continuous flourishing for all.
By the late 1970s, the postwar economic order was under obvious strain. Stagflation was one symptom; lagging American competitiveness against the allies we had rebuilt was another. The liberalization of the economy that started with conservatives in Congress under President Carter and expanded under President Reagan was necessary to restore the postwar promise. And it worked, in part by unleashing technological innovation that would be more creative than destructive over the next decade. The 1970s and ’80s also saw the creation or expansion of international institutions that were viewed at the time (if not always explicitly acknowledged) as instruments of Cold War policy. Everything from the acceptance of China into the American-led world economy to the construction of a European union was part of a strategy aimed at constraining the Soviet Union in the long run. Only the long run proved to be much shorter than anyone expected. By 1992 the strategic environment was totally transformed.
Yet America’s leaders did not think through the implications. Free trade agreements that made sense as a component of Cold War strategy took on a logic of their own, with plenty of support from academic economists who dreamed of nothing but global efficiency. Instead of viewing post–Cold War China as a rising rival, America’s elites saw the remaining communist superpower as a land of opportunity for themselves. The original rationale for America to pursue a global economic order had vanished. Yet instead of once again focusing on the economic interests of America’s workers, the country’s leaders committed themselves to universal liberalism. The result was a political backlash: The Pat Buchanan and Ross Perot campaigns of 1992 and 1996 featured pitched battles in Congress over “most favored nation” status for China and street protests against the World Trade Organization in 1999—the “Battle of Seattle.” But the backlash was undercut by a decade’s worth of technology-driven prosperity, and rather than conceding that the critics had a point, the consensus in Washington pushed ever further ahead. That led to a plunge in American industrial employment after 2000, as China was fully welcomed into the world economy.
Members of the credentialed class like to depict Trump’s voters as “nostalgic” for an America that is never coming back. If anything, it is our leadership that is nostalgic—for the 1990s—and deep in denial. Globalization was relatively pain-free during the 1990s because going into that decade Americans did not know what would happen next. The class compact of the past defined the public’s outlook and expectations more than the unknown future. Now the future without a class compact is clear to everyone, even if many in the leadership class are reluctant to describe it in frank terms. It means an America broken into three relatively immobile classes: a credentialed and knowledge-based elite, a large service class that prepares the first’s food and tends to its children (also the class of the urban Uber driver and suburban Amazon warehouse worker), and a vast economically unneeded population in what used to be the commercial and industrial heartland.
In their presidential campaigns, Barack Obama, Mitt Romney, and Hillary Clinton all provided insight into how the elite views those they consider part of the unproductive class: as “bitter clingers,” as a parasitical “47 percent” who are not “job creators,” and as moral “deplorables.” They are simply unnecessary to the next stage of economic and cultural liberalism. They want wages that are too high and career prospects to which they are not entitled. Their expectations are too great, in contrast to those of immigrants whose prospects only brighten if they come to the U.S. from the developing world.
The bipartisan elite’s policy program for the near future amounts to shoring up its own privileges with respect to intellectual property and bureaucratic know-how, while fragmenting and buying off the urban service class with identity politics. For the unproductives, the elite prescribes what might be called “palliative liberalism,” involving wage subsidies, tax credits, and other measures short of restoring inherent dignity and power to work. Palliative liberalism is not the same thing as the old welfare liberalism. The welfare state of the twentieth century was, at least in America, meant to be only an adjunct to a productive private economy in which almost all could participate. Palliative liberalism, on the other hand, aims not to repair labor-capital relations but to euthanize, as humanely as possible, millions of economically unneeded and politically retrograde Americans.
The justice of this euthanasia is said to be found in the laws of nature and the arc of history. The only nature that the prescribers of palliative liberalism recognize is the natural order of economics, whereby creative destruction applies not only to firms but to families, nations, and individuals. For the good of all, the inefficient must give way to the more productive. Only selfishness and ignorance can account for the resistance of privileged (or formerly privileged) working-class or middle-class Americans to this “natural” process. They, unlike the entrepreneurial worthies of Wall Street and Silicon Valley, are not deserving of their status. They don’t “create value” and should in effect trade places with the poor of the developing world. This is what being on the right side of history requires. The injustices of Christopher Columbus and Jim Crow will be repaid by the desolation of America’s “red” counties.
During the earlier class-war phase of the modern economy in the nineteenth and early twentieth centuries, religion moderated the harshness of the struggle, as did extended family and, to some degree, national sentiment. The rich felt obliged to be locally charitable, not just abstractly “philanthropic,” and civil society provided means for self-help. The irony is that the success of the twentieth century’s grand bargain—the welfare state and the middle-class growth economy—weakened family and religion, providing individuals unprecedented freedoms that, with the collapse of the bargain, have turned into unprecedented loneliness. The relief that church and family once provided is now supplied by fentanyl—another low-priced consumer product from China.
What factories remain in the emerging America will be ever more automated, while the American workforce will be further channeled into the service sector. That sector has two tiers: Some people will engage in physical service work and others will specialize in verbal and financial smarts. But even the high-status individuals of the latter group will in most cases be administrators and bureaucrats, not creators of new things but disentanglers of rules—as well as the sources of such entangling rules in the first place. The administrative class specializes in making itself seem essential to technological prosperity, as if Facebook etiquette monitors or corporate diversity officers are as important as the programmers. They are, after all, notionally just as highly educated: They went to the same schools as the software engineers and for just as long.
Yet even the winners in post-industrial America may find themselves poorer than their paychecks would suggest. As urban professionals’ income has risen, the cost of the essential accoutrements of their status has risen as well. You can’t be a professional without an “education,” and a year of college now costs as much as lower-tier professionals earn in a year. A credentialed-class winner who wants to have a semblance of professional community—including all-important networking opportunities—has to live in a city where real estate prices are sky-high. Some defenders of the emerging economy say that the decline of the middle class is nothing to worry about because it means more Americans have moved into upper income brackets. But the costs of moving into the higher class are staggering, quite commensurate, in many cases, with the higher pay. And not too far into the future, the technological redundancy that has struck the middle class will eliminate a good many financial, legal, and administrative jobs as well. (Unlike factory workers, however, lawyers and bureaucrats will have the political means to minimize the harm they suffer—just consider the different attitudes of our present elite toward protecting intellectual property against China and protecting manufacturing jobs.)
In some senses, the lower rung of the new urban service economy suggests a regression to the service economy of the aristocratic manor. There are jobs to be had as nannies or as dog-walkers. There are jobs to be had serving meals in restaurants or chauffeuring the wealthier around. These are not jobs that easily allow one to start a family or to retire in comfort. They also are not jobs that lend themselves to political organizing. Instead, race and lifestyle become the grounds for organization. They are poor substitutes for economic interest: The ties they create are looser, the issues they involve often more abstract and insoluble.
The real economy—the productive industrial economy—is unavoidably local. Metals have to be mined where they’re found. Factories are located where transportation is easiest, which is partly a function of nature (waterways) and partly design (highways and railways). With large concentrations of workers in particular industries living in particular places, workers can be organized, formally or otherwise, into political blocs to apply pressure to elected officials in support of their economic interests. This geographic proximity and common economic interest, as well as a shared way of life related to work, once bound together communities. The resulting America of the second half of the twentieth century was different from Tocqueville’s America or Thomas Jefferson’s yeoman dream. Neither man would have appreciated the welfare state and the lack of independent means characteristic of the employee-citizen. Nevertheless, that America was knitted together and worked.
Palliative liberalism and the rest of the political program of today’s leadership class hold little promise of keeping the country together. Whatever else it tries to do, an elite has to manage discontent. The rise of socialism and nationalism in American politics shows that already the effort is failing. The best-case scenario for the liberal elite is daunting to contemplate. Their interests, economic and cultural, are well-served by a completely atomized America, one in which states have not seceded, but individuals have. A heap of loose economic actors who have lost their cultural bearings allows itself to be managed benignly, if contemptibly, by the wealthy and educated. The more likely scenarios, however, involve upheaval in the name of socialism or something like military-imposed order. Look to Latin America for the past as preview.
There is a better way. The most effective and honorable way out of the dilemma we face is to embrace something like nationalism as an economic program. At the end of the eighteenth century, the French ancien régime paid the ultimate price for failing to mend its ways. Had nineteenth-century Britain not adjusted the balance of power and interests between landed lords, commercial magnates, and the growing urban working class, a similar fate would have awaited it. America’s fundamental political choice now is between mild nationalism, resurgent socialism, or suicide by liberalism, whether of the libertarian or palliative sort. That being the case, how would the nationalist alternative work?
It would begin by rejecting propaganda about the end of the export economy. World population is still growing, and growing wealthier, which means there are more people around the world increasingly capable of buying goods made in America. We sacrificed some of our competitive advantage after World War II for the sake of Cold War strategy, and we were right to do so. But now the time has come to compete to the utmost, at once politically and economically, with our rivals, above all China. That means driving bargains to open markets for our goods while permitting access to our markets—still the most desirable in the world—on terms favorable to our citizens in full, in their capacity as producers, not just as consumers. The argument that the loss of manufacturing jobs to technology excuses the extinction of manufacturing employment is not an argument at all. What follows is that we ought to minimize the loss of employment due to every factor not technologically inevitable, such as ill-conceived trade deals. Tariffs are not an end in themselves, of course: They are a defensive measure and a source of leverage.
President Trump’s instincts are correct about immigration as well: It is in need of reform that puts citizens first, with emphasis on supporting higher wages for workers. Less low-skill immigration puts upward pressure on wages. And what if there just aren’t enough American workers to fill all the jobs? That’s good, too, because, other things being equal, it encourages larger family size. When parents see opportunities for their children in a world in which more labor is needed, they have confidence to have more children. This is why populations everywhere boom at the onset of an industrial revolution, and it’s a reason why frontier settler populations so often have such high rates of family formation. Get employment growing again for Americans who are not already on the top of the heap, and their families can grow again, too.
There’s an argument to be made for shifting policy preference from low-skill immigration to high-skill immigration, not only so that the country receives more economic value per immigrant but also to put competitive pressure on the professional elite. The more the elite feels the same pressures as the working class—from technology and immigration—the more its attitude toward patriotism may improve. Naturalization of high-skilled immigrants is preferable to the present H-1B visa program, which favors employers over native and immigrant workers alike by putting downward wage pressure on natives and making temporary immigrants effectively indentured to their employers.
The idea that economic nationalism is not compatible with free-market economics is absurd. The history of America from the founding to the New Deal belies the idea that nationalist economics is bad for business or growth. Its virtue is that it is good for labor and political stability as well. From growth, a contented middle class, and moderate political culture flow a strong country and stronger families and citizens. In the early decades of the twenty-first century, when nations and supranational institutions are in turmoil, those benefits are of existential significance.
The ideal of Jefferson’s agrarian America (as distinct from its too often plantation-based reality) was a nation of virtuous yeomanry—small, independent farmers capable of providing for their families themselves. Abraham Lincoln’s vision was of a country in which working men, not only farmers, could improve their standards of life. In the twentieth century, the American dream became a thing to which every salaryman could aspire: a good job; enough money to buy a house, start a family, and retire; and the chance to watch one’s children rise to a higher station. In the twenty-first century, that dream has given way to delirium—feverish uncertainty about whether in midlife one will have to become an Amazon deliveryman or a Walmart greeter, and anxiety about whether one’s children will be tech-company winners or endlessly indebted gig workers.
We need to accept the responsibilities of leadership. That means governing in the century in which we actually live rather than the one shaped by our political heroes. After the fall of the Soviet Union, the world began to change, and our country with it. Those changes have accelerated and are now threatening to tear us apart. The way forward requires refocusing on the American citizen as the basic unit of the economy. This is the essence of a nationalist political economy, which we very much need if our country’s tradition of personal independence and limited government is to endure, a tradition in which government’s primary economic role is not to provide welfare but to safeguard the conditions that make productive work possible.