Replies to post #5227 on The Big Picture (putting it all together)

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April 16, 2010
The Constitutionalist Revolt In the U.S.
By Larry Kudlow

So much is being written in the mainstream media about who the tea partiers are, but very little is being recorded about what these folks are actually saying.

We know that this is a decentralized grassroots movement, with many different voices hailing from many different towns across the country. But the tea-party message comes together in the "Contract from America," the product of an online vote orchestrated by Ryan Hecker, a Houston tea-party activist and national coordinator for the Tea Party Patriots.

With nearly 500,000 votes recorded in less than two months, this Contract forms a blueprint of tea-party policy goals and beliefs.

Of the top-ten planks in the Contract, the number-one issue is protect the Constitution. That's followed by reject cap-and-trade, demand a balanced budget, and enact fundamental tax reform. And then comes number five: Restore fiscal responsibility and constitutionally limited government in Washington.

Note that two of the top-five priorities of the tea partiers mention the Constitution.

Filling out the Contract, the bottom-five planks are end runaway government spending; defund, repeal, and replace government-run health care; pass an all-of-the-above energy policy; stop the pork; and stop the tax hikes.

What's so significant to me about this tea-party Contract from America is the strong emphasis on constitutional limits and restraints on legislation, spending, taxing, and government control of the economy. Undoubtedly, the emphasis is there because no one trusts Washington.

As I read this Contract, tea partiers are reminding all of us of the need for the Constitution to protect our freedoms. They're calling for a renewal of constitutional values, including -- first and foremost -- a return to constitutional limits on government. The tea partiers who responded to this poll are demanding a rebirth of the consent of the governed. The government works for us, we don't work for it.

All this makes me think of President Reagan, who never quite succeeded in gaining a constitutional amendment for a balanced budget, or for limits on spending, or for a two-thirds congressional majority for any new tax hikes. But throughout his presidency, and for many years before, the Gipper argued for constitutional limits on government, especially government spending.

And now this message is being echoed perfectly in the tea-party Contract from America. In effect, it picks up where Reagan left off.

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?