What History, and the Budget, Bodes for the Tea Party

Mark Blyth and Akim Reinhardt, Guest Blogger

The results are in from the US midterms and as expected the outsiders are the new insiders. Tea Party candidates continue to make inroads. Rubio and Paul succeeded where O’Donnell and Whitman failed, but the momentum is theirs. From this point on the Democrats’ nightmare is that for the next two years these ‘no-compromise’ Republicans will produce policy gridlock and blame the Democrats for it. The anger that brought them to power will build in the face of a staled economy and a stalled Congress, and more such candidates will be elected in 2012, possibly even a President bearing their mark. But even if this happens will they really be able to radically alter American politics and the trajectory of federal spending? It is perhaps worthwhile then to look back upon similar ‘outsider’ eruptions in American politics to ask if the Tea Party really will mark a sea change in American politics.

Modern political parties emerged in America in the 1820s. Since then it has mostly been a two-party game that relegated other parties to the extreme fringe. However, important third party challenges have occasionally emerged, generally during times of social and economic stress. Most notable are the two prior waves of American populism, the American “Know Nothing” Party of the 1850s, which arose in reaction to foreign immigration and relentless urbanization, and the People’s “Populist” Party of the 1890s, which emerged when smallholder farmers were thrust into the modern market economy.

When immigrants poured into the U.S. during the 1840s, nativists reacted by organizing local social protest groups that called upon the federal government to restrict immigration. The movement claimed between 800,000 and 1,500,000 members by 1854 when it formed the American Party. It soon controlled several state governments and nominated former President Millard Fillmore for the White House in 1856. After Fillmore’s loss, the party quickly faded, overwhelmed by the combined forces of Republican co-optation and the politics of slavery.

Then, during the 1870s, as American farmers mechanized operations, increased production, and leveraged debt, they fell victim to both falling prices and declining status. Their rage against bankers and railroads fermented in rural social clubs called Granges that during the 1880s coalesced into three major Farmers’ Alliances with about 2,000,000 members. These Alliances formed the People’s Party in 1892, achieving immediate success by placing several governors, representatives, and senators, and electing a staggering 1,500 state legislators nationwide. A major financial collapse in 1893 further fueled their rise, but a serious challenge for the presidency in 1896 sputtered when the Democrats nominated William Jennings Bryan, who advocated many of their proposals. Their demise quickly followed Bryan’s election defeat as the Democrats’ continued to co-opt and dilute their platform.

There are then some obvious parallels to the Tea Party today. All three movements, Know-Nothings, Populists and Tea-Partiers, began as social protest movements animated by sudden and serious disruptions to American economy and society. The latter two were spurred into existence by major financial dislocations. The former two eventually formed functioning parties that achieved stunning success in local and regional elections, a feat the Tea Party may repeat if the Republicans do not carry their budget cutting agenda far enough.

The Tea Party has strong parallels to ‘Know-Nothings’ on immigration, which surged in America during the 1990s, with raw numbers matching the historic highs of the 19^th Century. Opposition to immigration is perhaps the one area where Tea-Party members are united, with Arizona’s controversial law serving as a model. Moreover, like the farmers who founded the People’s Party, Tea Party members are those who did well in the boom and got hammered in the slump: they levered up and then saw their assets, and status, fall precipitously. In both cases special interests and bankers got the blame.

Tellingly, these prior populist eruptions petered out, either overtaken by events or co-opted. So will the Tea Party go the same way, or will it be different this time? There are reasons to suggest that despite all the noise and fury, they may go the way of their predecessors when the Tea Party’s anti-statist ideology comes up against the reality of the Federal Budget.

Unlike the Tea Party, the federal government was something that the Populists of the 19^th century wanted more of, not less. Populist demands; a progressive national income tax, government-run alternatives to private banks, government ownership of communications and transportation, and an inflationary monetary policy, are the exact opposite of Tea Party policies today. But can the Tea Party really reverse the growth of the state and in doing so restore America?

When the Tea Party gets into power they will have to deal with the fact that the biggest budget buster is not Obama’s hated stimulus package, but the unfunded Medicare prescription drug benefit, which many of their supporters will shrink from cutting. Take Federal education spending out of the budget by shutting down the Department of Education, another Tea Party favorite, and Medicare, Medicaid and Social Security will still comprise over 50 percent of the federal budget. Add in defense spending and around 75 percent of the budget is a giant political ‘third-rail.’ Yet this is precisely where you need to cut if you are serious. The rest is either chump-change, or it is even less likely to end up on the chopping block: the ever popular mortgage interest tax deduction, for example. And of course, tax increases are ultra vires. Faced with this dilemma, we will soon find out if the party is over before the tea is poured.

If they really do not balk at cutting core programs that primarily benefit their own members, and their members continue to support it, then the Tea Party may actually change the system, and change America in the process. But what is more likely is that faced with the reality of cutting their own pocketbooks in the middle of a continued recession, the Tea-Party’s only policy of slashing the state will lose traction once it becomes apparent that this ‘out-of-control state spending’ is actually your wife’s hip replacement, your pension, and your daughter’s school teacher’s emergency salary. When that happens, the Tea Party may find itself, like the America Party and the People’s Party, an interesting spasm, rather than the sea change in the history of America that it hopes to be.

Mark Blyth is Professor of International Political Economy at Brown University, Rhode Island.

Akim Reinhardt is Professor of History at Towson University, Maryland.