Recommended: The Second Marriage

On Nov 1, before the midterm elections, David Brooks wrote an interesting piece in the New York Times, The Second Marriage.  In it he argues that, despite the Tea Party members, the Republicans coming into power this time in the House will have a much more modest approach than they had last time they held power, and certainly much more modest than the Democrats have been over the past two years.  He thinks they will focus on producing a series of small, incremental steps to improve the business environment.

There are other writers in recent days who have argued that the Democrats as a party, and President Obama in particular, just don't "get" business.  That they don't understand the fundamental laws of economics. They love to demonize business, without understanding that business is in fact the engine of the entire system. Certainly the past two years seem to support that argument.

At root, economics is all that matters. Without a strong economy, we can't afford either the domestic programs liberals would like or the strong military the conservatives would like.  Without a strong economy our influence and leverage and "soft power" in the world is much reduced. Without a strong economy, people can't enjoy prosperity or economic security. In the end, it is not Washington policy that creates jobs and wealth (whatever liberals may think), it is successful, innovative businesses that are competitive in the world market.

The Obama administration's big mistake, in my opinion, was to divert their efforts and political capital to peripheral things like the health care bill when they should have focused ALL their energy and political capital on things that would improve the economy immediately and make American businesses more competitive in the world market. That means focusing on reducing regulations and Washington bureaucracy that impedes businesses, improving American education, especially for adult retraining in the workforce, improving the health of banks, building or updating infrastructure that directly affects business, and encouraging innovation and the basic science that feeds innovation.  To be sure, they have made half-hearted attempts at a few of these things, but none have been the primary focus of their attention, and none have gotten the sort of funding that their liberal efforts have gotten. (As a wise mentor once taught me: ignore the rhetoric and watch where the funding goes - that tells you what people's REAL priorities are).

One hopes Republicans will do better, though of course their power is still pretty limited, since they control only the House.