It’s 2024. The vast majority of baby boomers have arrived at retirement age. The pre-baby boomers are rapidly passing from the scene. (The youngest of them, born in 1945, are about to turn 80.) The long-predicted crisis of the American fiscal system has arrived.
The political scientist Harold Lasswell famously defined politics as a contest over “who gets what, when, and how.” Over the next dozen years, as the gap between the revenue lines and the expenditure lines of the federal and state governments widen, that definition could aptly be amended: Who gets disappointed—and by how much? Will baby boomers receive a less generous deal from Medicare than their parents did? Will the huge promises to public-sector retirees be honored? Or will other programs for younger people be squeezed? Will we sacrifice America’s military presence in the world? Or will we exact more in taxes—and if so, what kind of taxes, and imposed on whom?
These harrowing questions have disconcerting political implications for the country’s two great political parties.
For Democrats, the trends pose a stark distributional question. The younger people of the 2020s, survivors of the Great Recession, will in the aggregate be poorer than their elders. Should these younger workers be taxed or see their own social services squeezed in order to support Medicare and public-service pensions in their full amplitude?
For Republicans, the trends pose a coalition-management question. Throughout the Obama years, Republicans built a powerful coalition of the rich and the old. The coalition was built on two principles: militant rejection of any and all new taxes, and unyielding defense of existing government benefits for those at or near retirement age.
But as Medicare costs rise, the no-new-taxes/no-cuts-in-Medicare combination will become increasingly difficult to sustain. Already, polls show that Republican voters (as opposed to activists) prefer tax increases on upper-income earners to Medicare cuts. So long as the choice between taxes and Medicare cuts remains latent, the preferences of rank-and-file Republicans may not matter much. But as budget gaps widen, that tension will surely come to the fore.
The trend, as they say, is the trend only till it bends. Yet it’s also true that 12 years is not so very far away. Let’s hazard two plausible scenarios.
1) Reactionary Democrats. Democrats depend hugely on public-sector unions for votes and money. Suppose the party decides to make a priority of protecting their interests and those of their retirees. Democrats may call for higher taxes on the rich to pay for these benefits, but that math does not suffice. The non-rich young will also have to pay.
But the young of the 2020s will not only be poorer than the elderly. They will be ethnically different. Whereas public-sector retirees will be whiter and blacker than the total population, the young of the 2020s will be more Hispanic and Asian. Age competition will also be ethnic competition.
Could that competition be the force that shakes loose Hispanic and Asian voters from the Democratic coalition? Asian voters in particular are better educated, more affluent, and more likely to be self-employed—prime candidates for Republican recruitment. The Conservative parties in Canada and the UK have made great inroads among Asian voters. (In the Canadian election of 2010, the Conservatives won a plurality among voters who speak Chinese at home.) Could a reactionary Democratic Party at last do what George W. Bush’s “compassionate conservatism” tried and failed to do in the 2000s and move large numbers of people of color into the GOP column?
2) Upper-class Republicans. If the fiscal squeeze tightens enough, Republicans will be forced to choose between their limited government ideology and their older voting base. If they choose their ideology, they will need to locate some new voters in upper-income America. They will need to draw back to the Grand Old Party the kind of voters who defected to Barack Obama in 2008: affluent professionals, especially women, in major urban centers. This was the kind of Republicanism practiced in the 1990s by governors like Christine Todd Whitman, John Engler, Tommy Thompson, and George Pataki. Such a Republicanism would not need to jettison its pro-life message, just de-emphasize it, as Democrats have, for example, de-emphasized their message on gun control.
At the beginning of the Tea Party era, there was much talk that Republicans might switch to a more economic, less culturally exclusive message. That talk came to nothing. Instead, Republicans infused cultural exclusion into their economics, drawing a sharp distinction between the “earned” benefit of Medicare and Social Security and other programs that serve supposedly less deserving populations: food stamps, unemployment insurance, and Medicaid.
Yet it does not have to be this way. The GOP can remain a culturally conservative party without needing to endorse vaginal inspections of women or miring itself in fights over birth control. The coming generational shift within the GOP on gay rights points the way to such future change.
Such a GOP would look more like conservative parties elsewhere on the planet—and less like the Southern Democrats of the 1950s. And while some Republicans might dismiss those non-U.S. conservative parties as squishy, it’s worth noting that at least some of them—notably the Germans and Canadians—managed successfully to complete the fiscal consolidation that in the United States still looms terrifyingly ahead.
Of course, this is not the only option for the Republicans. But it’s the way that remains truest to what is most useful in the GOP, as the party of enterprise, opportunity—and freedom.