Senator Elizabeth Warren is giving many Democrats fits with her populist rhetoric, but Republicans are the ones who should pay attention.
The draft Warren movement, spearheaded by organizations like MoveOn.org, earnestly believes most voters want more of President Obama’s agenda: blame American engagement abroad, racism and sexism and the wealthy for all the problems of humanity.
No matter after six years of his misplaced idealism, ISIS holds American hostages and North Korean dictator Kim Jong-un is Hollywood’s new censor, Al Sharpton and Attorney General Eric Holder have whipped up lethal mob hysteria about police, and nearly one in six men between the ages of 25 and 54 remain jobless and without hope.
Americans are angry but while they may drub Obama in the polls, the strongest presidential candidate remains Hillary Clinton. And she is now salting her campaign speeches with populist rhetoric in deference to Warren’s appeal.
And Republicans don’t have an attractive response to Warren or Clinton.
Republicans have been slow to learn that the hard left’s prescriptions may be wrong but their sense of what angers Americans is spot on.
New technologies have made the world terribly more difficult for American foreign policy to manage. Cell phones permit revolutionaries to organize, as they did in Egypt, under the noses of national leaders, and cheap software permits North Korea hackers to dictate to Sony and snatch ordinary folks’ most private information.
Unless Americans are willing to use lethal force—for example by shutting down North Korea’s power grid—they are going to have to accept a lot of grief from dictators likes Kim.
Senator John McCain is correct that cyber attacks are a new form of warfare, but Americans are simply not willing to bloody many noses. Democrats like Senator Charles Schumer and Hillary Clinton will play on that in 2016.
But more importantly, though, Warren’s harpings about big business and even bigger banks ring true to Americans—because they are true—even if misadventures like Obamacare and Dodd Frank have proven the most robust of failures of liberalism in our post-modern age.
Health care is too expensive—as are so many other things—and banks do abuse most Americans, because Democrats have cynically supported monopolies for those who generously contribute to their political campaigns.
Those monopolies enrich friends of the party that fancies itself friend of the common man. For example, Comcast CEO Brian Roberts is a big fund raiser for Obama and pays Al Sharpton’s MSNBC salary, and has leveraged a dull utility into a media empire.
Senator Schumer is legend for mining Wall Street to support Democratic candidates.
GOP leaders like Paul Ryan need to go after those insidious alliances and their connections to high prices, low wages and negligible interest most Americans earn on their savings, instead of apologizing for free markets and offering vouchers to fix health care.
Ordinary Americans would profit from a competitive market place, but Elizabeth Warren—and the likely Democratic standard bearer in 2016 Hillary Clinton—is right. These days, the American marketplace is hardly competitive.
What should separate the GOP from Democrats is not middle class angst but that Warren, Clinton and other Democrats want even more government regulation. That will permit them to dole out even more favors to their friends in business in exchange for campaign largess, keeping American families pinned down, dependent on government largess and more likely to vote Democratic.
The GOP should take a page from Republican Teddy Roosevelt—become trust busters. Advocate breaking up the big health insurance, drug and cable companies—and the worst offenders, Wall Street’s banks—to reinvigorate growth and make essentials like health care affordable again.
Give the economy back to Americans—and they will make it run and run well again.
Peter Morici served as Chief Economist at the U.S. International Trade Commission from 1993 to 1995. He is an economist and professor at the Smith School of Business, University of Maryland, and a widely published columnist. He is the five time winner of the MarketWatch best forecaster award. Follow him on Twitter @PMorici1.