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0 Comments | Insight on the News, August 15, 1994 | by Richard W. Rahn

In every presidential election from 1956 through 1992, the incumbent party stayed in power when government spending grew at a slower rate than the economy and lost when government spending grew faster than the economy. The lesson should be clear: If the Republican Party wants to win elections, it not only needs to talk about reducing government spending and taxing but also must act to do so when in power.

George Bush did not lose the 1992 presidential election because he stayed with his antiabortion position, as the left has argued, nor could he have won by taking harder stands on the cultural conservative agenda. Bush lost because he abandoned his pledges to reduce spending and not to raise taxes. There is nothing Bush could have said or done on the social or cultural conservative agenda that would have led him to victory. The plain fact is, government spending grew rapidly under Bush, both in real and relative terms. Under Ronald Reagan, government spending grew in absolute terms but fell relative to the growth in the economy. And that was the difference between big victories and a big defeat.

Look at the recent Republican victories -- those of Paul Coverdell in Georgia, Kay Bailey Hutchison in Texas and Christine Todd Whitman in New Jersey -- they won on the pledge to reduce the size of government, not on opposition to abortion. These candidates did advocate measures to deal with our social decline, which was wise but not determinant in their election success.

The fact is that most of the social ills we face as a nation come from too much rather than too little government and can be solved only by reducing government. When you subsidize something you get more of it, and when you tax something you get less of it. Thus, it should be no surprise that as government has increasingly taxed work, saving and investment, our economic growth rate has suffered. On the other hand, as government subsidizes undesirable behavior, such as out-of-wedlock births by teenagers, we get more of that behavior. Calls for more virtue are not enough when the opposite is subsidized by government.

As long as government provides a high safety net for irresponsible behavior, we will have less responsibility rather than more. For instance, a national health care bill that does not allow government or private insurers to discriminate between people who maintain more rather than less healthy lifestyles will result in a less healthy populace. Big government tends to insulate people from the consequences of their antisocial actions, thus the decline in social indicators would be expected as government has grown.

Most social and cultural conservatives realize that big government is the problem, which is why most of them also favor smaller government. However, there are some social and cultural conservatives who do not sufficiently understand the relationship between big government and societal ills, which causes them to deemphasize the importance of spending control and tax-rate reduction.

For most Republican candidates to win, they need to build a coalition of fiscal conservatives, libertarians, strong-defense advocates and cultural conservatives, as Ronald Reagan did. To ignore or offend any of these constituencies often leads to defeat. The cultural conservatives have an additional problem. While their recognition of social problems is widely shared within the Republican Party, there is considerable disagreement about the solutions. Overly rigid social solutions in the party platform are more likely to lose voters than to gain new adherents. For instance, a plank that opposes government funding for abortion while not denying the possibility of abortion under some conditions will likely be found more acceptable to the vast majority of fiscal conservatives, libertarians and social conservatives within the party than a flat ban.

Good economists know that as the government sector in any economy expands beyond 10 to 20 percent of gross domestic product, economic growth tends to slow. The result of slow economic growth is that citizens who are at the bottom of the income scale find their lives more difficult because of diminished opportunities. For years, the liberals or statists have aruged for expanded government as a way of helping low-income people, which as we now know most often is counterproductive. Too often, social and fiscal conservatives implicitly bought into the liberal argument by accepting the premise but demanding a more cautious and fiscally responsible approach to the management of social programs. Conservative acquiescence to the liberal premise enabled the liberals to paint the "go slow" conservatives as mean-spirited or uncaring.

Before Republican candidates can win, they must first understand, and then be able to communicate to the electorate, the fatal flaws in the liberal welfare state and how the Republican conservative opportunity society will make their lives better.

Why is it that big government doesn't work? First, many programs offer perverse incentives for antisocial behavior. That is, people are explicitly rewarded for not working, not saving or investing and not protecting their health.