Republicans are getting giddy about possibly taking back the Senate. The Republican segments of K Street are getting excited, too.
But cozying up to K Street won’t help Republicans win the upper chamber. And if the party takes control and then spends the next two years attending only to the interests of Big Business, it won’t reflect well on the GOP.
What Republicans need today — to pitch on the campaign trail, and to pursue if they control both chambers — is an anti-corporate-welfare agenda.
Campaigning against corporate welfare, and governing the same way, will reap political profit for the GOP. In cases where Democrats have firmly attached themselves to corporate welfare programs (such as the Export-Import Bank), a free-market populist agenda will draw sharp contrasts with Big-Business-Big-Government Democrats in the run-up to an election where corporatist Hillary Clinton could be the presidential nominee.
In cases where Democrats may be amenable to reform (such as cutting farm subsidies), dismantling corporate welfare will help conservatives in the long run by ending the vicious circle of corporate government dependency.
There are a few warning signs that the Senate GOP may be gravitating too much towards the comfy confines of K Street. On Sept. 12, Sen. Rob Portman, R-Ohio, laid out the Republicans’ agenda for the first 100 days if they win 51 seats. There was nothing wrong with his four bullet points — the Keystone XL pipeline, corporate tax reform, regulatory reform, and fast-track authority for free-trade agreements. But of those, only Keystone has any real popular appeal. The real audience for these policies is the business lobby.
On Sept. 13 and 14, Republican senators and Senate candidates attended a retreat in Hot Springs, Va., populated by “dozens of K Streeters,” according to Politico’s Anna Palmer. These included lobbyists who have pushed for ethanol subsidies, tobacco regulation, and Hollywood tax credits.
Another data point: For the first time in the Obama era, lobbyists are giving more money to Republicans than to Democrats. The Center for Responsive Politics reports that Republicans have received $12.4 million from lobbyists to the Democrats’ $11.3 million. This is a huge shift — over the past three elections, Democrats pocketed more than 58 percent of lobbyist donations.
Meanwhile, Joni Ernst of Iowa, a top Republican Senate prospect in a tight race, is on the record favoring ethanol subsidies and the Export-Import Bank.
This is not the path for appealing to middle-class voters — something Mitt Romney failed to do. Republicans, to win the White House, will need policies that concretely help average people (such as cutting the payroll tax). But a big part of this effort could be waging war on corporate welfare.
If Republicans decide that they really believe in all that free-market talk, and they train their sights on corporate welfare, they’ll find a target-rich environment.
First, all Republicans should follow the lead of North Carolina GOP Senate nominee Thom Tillis. Although he has something of a corporatist reputation among Carolina conservatives, he is campaigning on killing Ex-Im, which subsidizes foreign buyers of U.S. goods at taxpayer expense. Ex-Im has a sister agency, OPIC, which is even less defensible: It subsidizes U.S. companies who set up businesses overseas.
Bobby Jindal laid down the marker for Republican presidential candidates on Tuesday at the Heritage Foundation, when he called for phasing out the ethanol mandate. No pandering to Iowa there. The Republican Senate could start the ethanol fight in January, pointing out that the mandate raises food prices and sometimes gasoline prices, while reducing fuel efficiency.
Beyond Ex-Im and ethanol, the third member of the unholy trinity of corporate welfare is the sugar program. This program drives up prices for shoppers and U.S. candymakers, while benefiting only a few politically connected businessmen.
Crop insurance, terrorism reinsurance, and bans on oil and natural gas exporting are all special-interest big-government programs that hurt the U.S. economy on the whole.
Special tax breaks for renewable energy and fossil fuels also tilt the playing field and replace the judgment of the market with the judgment of politicians. Republicans have been good at attacking solar panel subsidies as “crony capitalism,” but Solyndra isn’t the only winner selected by federal policy.
“You can’t say you’re for the government not being able to pick winners and losers,” Jindal said at Heritage, “except for the industries that happen to be in my state.”
Republicans have for too long been captive to industry lobbyists seeking special favors. In these days where Democrats still control the Senate and the White House, the GOP has a chance to speak free enterprise to power.
Timothy P. Carney, the Washington Examiner’s senior political columnist, can be contacted at [email protected]. His column appears Sunday and Wednesday on washingtonexaminer.com.
