The tea partiers, whom I call free-market populists, desire a return to Reaganism. In particular, their demands for a balanced budget (third plank), for restoring fiscal responsibility (5th plank), for ending massive government spending (6th plank), and for stopping the pork (9th plank) all underscore the populist revolt against runaway government spending, and therefore runaway government power.
There are mentions in the Contract of tax reform and stopping tax hikes. But it is pretty clear to everyone nowadays that the massive run-up in spending of recent years will inevitably result in an equally massive tax-hike movement -- that is, unless the spending is strictly curbed and reduced.
Yet the tea partiers don’t trust Congress to do this, so they want to bring in constitutional restraint.
A recent survey by the Brookings Institution spells out this spend-and-tax problem with great clarity. Under current spending trends, tax-the-rich efforts to bring the deficit to just 3 percent of GDP -- not balance, mind you, but 3 percent deficit -- would require a nearly 80 percent marginal tax rate on the most successful earners. And if taxes are raised across-the-board, the marginal rate would rise to nearly 50 percent for the top earners, with state and local tax burdens bringing it up to 60 percent. Otherwise, a European-style value-added tax (VAT) would become necessary.
The tea partiers know this and they don’t like it one bit. And so, at bottom, they have formed a constitutionalist movement to revolt against big government and big taxes -- and oh, by the way, to stand against big-government control of large chunks of the economy, such as energy and health care.
Harking back to the Founders’ principles of constitutional limits to government is a very powerful message. It’s a message of freedom, especially economic freedom. The tea partiers have delivered an extremely accurate diagnostic of what ails America right now: Government is growing too fast, too much, too expensively, and in too many places -- and in the process it is crowding out our cherished economic freedom.
It’s as though the tea partiers are saying this great country will never fulfill its long-run potential to prosper, create jobs, and lead the world unless constitutional limits to government are restored.
Now, as the tea partiers rally across the country, the big question is only this: Will the political class get it?