Republican challenge: Darwinian markets and Darwinian government

It’s baked into their statements and their silences: US government will get bigger under a Romney-Ryan presidency. Even if their tax cuts don’t happen or don’t work, they’ll borrow the money to spend more on public and private healthcare, domestic security, and the military. They’ll keep doing it for eight years, if they get the chance.

Federal government social spending—by American and OECD standards—will keep getting bigger whether Obama or Romney wins.

Yet, this is a big election.

Both party elites are economic Darwinians. They believe that freer trade, more competition, greater personal mobility, and greater tax and regulatory certainty will best generate economic growth, higher incomes, and productive investment. 

The Romney-Ryan Republicans, however, are social Darwinians as well. They believe that Washington’s “entitlement culture” limits innovation and will bankrupt the country. They want to replace it with a more flexible and stronger political market in determining how the federal government helps individual Americans.

“Entitlements” are at stake, but the issue isn’t about their costs but about the ruthless games they prevent. An entitlement isn’t an inflationary cancer, as Ryan and Romney and their slides so earnestly imply. An entitlement is nothing less and nothing more than a guarantee of equal access to a good or service that government has already agreed to provide.

The guarantee isn’t necessarily inflationary and the program needn’t be poorly run. All that the guarantee does is take away privileged access.

Neither Romney nor Ryan ever said that the principal service in question—essential health care—isn’t a public responsibility, that Medicare was a socialist mistake. They reject privatization absolutely. Their grievance with Democrats on this point is fair. Indeed, Ryan niftily defused that issue with Bill Keller in the  New York Times yesterday morning:

“‘We have consensus within both parties and in the country that health security is a mission of the federal government,’ he said in a phone call from Wisconsin.”

A lovely statement of the obvious.

For two generations, Republicans and Democrats have competed to create the most expensive health care system in the developed world.

Romney and Ryan’s merging fiscal plans—tax cuts, vouchers, and health subsidies instead of guarantees—will continue to ensure that affluent Americans continue to get the highest quality health care in the world—without any noticeable financial risk on their part. There will be marvelous experiments, but not on them.

Those too old to be drafted and those with political power in the Washington political market will have nothing to fear from “entitlement reform.” Like volunteers in 1914, they’ll be signing up for a happy patriotic war.

They can always lobby to protect their interests and keep those benefits they’ve come to believe they’ve earned.

Taking away the universal access guarantees of Medicare, Medicaid, and Obama-care and then giving the politically and economically weak cash subsidies, however, is quite another matter. Who the most powerful government in the world works for could be the central issue of the election.

Republicans will say the election is about the size of government and will scramble to get their government beneficiaries out to vote.