Conservatives generally believe that capitalism is a machine that cures itself. Therefore, people on the right have been slow to recognize the deep structural problems that are making life harder in the new economy -- that are leading to stagnant social mobility, widening inequality and pervasive insecurity.
But some conservatives have begun to face these issues head on. These reform conservatives have now published a policy-laden manifesto called "Room to Grow," which is the most coherent and compelling policy agenda the American right has produced this century.
In the first essay of the book, Peter Wehner moves beyond the ruinous Republican view that the country is divided between hearty entrepreneurs and parasitic "takers." Like most reform conservatives, he shifts attention sympathetically to the struggling working and middle classes. He grapples with the fact, uncomfortable for conservatives, that the odds of escaping poverty are about half as high in the United States as in more mobile countries like Denmark.
Yuval Levin argues that conservatives have tacitly accepted the 20th-century welfare state; they just want less of it. To respond to the economy's structural woes, he continues, conservatives will have to change not only the size of the government but its nature.
"The left's ideal approach," Levin writes, "is to put enormous faith in the knowledge of experts in the center and empower them to address the problem." The right's ideal approach, he continues, "is to put some modest faith in the knowledge of the people on the ground and empower them to try ways of addressing the problem incrementally."
Liberals emphasize individuals and the state, Levin argues. Conservatives should funnel resources to nurture the civic institutions in between. They should set up decentralized initiatives that rely on local knowledge and allow for a more dynamic process of experimentation.
The next 10 chapters contain a slew of proposals to decentralize the welfare state. Several writers support much larger family tax credits to empower families. James C. Capretta writes that households without access to employee health plans could be given a tax credit comparable in size to the tax subsidy given to families with these plans.
Frederick M. Hess suggests that parents should be given "course choice," the chance to not only choose their children's school but to use a fraction of school funding to purchase access to specialized programs, in, say, math or science. Scott Winship mentions the universal credit, which consolidates a variety of anti-poverty programs and distributes benefits to families as a single amount.
Under these and other proposals, the government would address middle-class economic security by devolving power down to households and local governments. This is both to the left of the current Tea Party agenda (more public activism) and also to the right (more fundamental reform). The agenda is a great start but underestimates a few realities. First, the authors underestimate the consequences of declining social capital.
Today, millions of Americans are behaving in ways that make no economic sense: dropping out of school, having children out of wedlock. They do so because the social guardrails that used to guide behavior have dissolved.
Giving people in these circumstances tax credits is not going to lead to long-term thinking. Putting more risk into vulnerable people's lives may not make them happier.
The nanny state may have drained civil society, but simply removing the nanny state will not restore it. There have to be programs that encourage local paternalism: early education programs with wraparound services to reinforce parenting skills, social entrepreneurship funds to reweave community, paternalistic welfare rules to encourage work.
Second, conservatives should not be naÃÂ¯ve about sin. We are moving from a world dominated by big cross-class organizations, like public bureaucracies, corporations and unions, toward a world dominated by clusters of networked power. These clusters - Wall Street, Washington, big agriculture, big energy, big universities - are dominated by interlocking elites who create self-serving arrangements for themselves. Society is split between those bred into these networks and those who are not. Moreover, the U.S. economy is increasingly competing against autocratic economies, which play by their own self-serving rules.
Sometimes government is going to have to be active to disrupt local oligarchies and global autocracies by fomenting creative destruction - by insisting on dynamic immigration policies, by pumping money into research, by creating urban environments that nurture innovation, by spending money to give those outside the clusters new paths to rise.
I'd say the reform conservatives are still a little too Jeffersonian. They have a bit too much faith in the magic of decentralization. Some decentralized reforms do nurture personal responsibility and community flourishing.
But as Alexander Hamilton (and Margaret Thatcher) understood, sometimes decentralization needs to be complemented with energetic national policies, to disrupt local oligarchies, self-serving arrangements and gradual national decline.