Forbes is running a rough and extremely expensive air war, launching attack spots against even second-tier candidates like Lamar Alexander. Usually this wounds the attacker as much as the targets. But not Forbes–not yet. Nor has he been hurt by revealing that his childhood chores consisted of wearing a kilt to play bagpipes or that his biggest life challenge was going off to prep school. That’s because even the negative reminders of Forbes’s wealth subtly reinforce his basic message, which is that money makes the world go round. His money. Our money. The money being wasted by corrupt Washington. “There’s no distinction between values and economics–honesty, hard work, thrift, trust,” Forbes says in his standard speech. He knows “the way the world works,” to quote the title of the book by his supply-side guru, Jude Wanniski. And the tidiness of this comfortable world is contagious.
One day last week in New Hampshire, two of Forbes’s three events were in the same natural habitat, the Nashua Country Club, where he went over nicely: rep tie, red-meat lines about “driving a stake through the heart of the IRS,” an awkward (and thereby oh-so-authentic) smile frozen on his face at all times. The smile is the sacrament of his creed. Forbes knows political history, which means that he knows that, excluding 1968, the sunniest candidate has won every presidential election since Al (The Happy Warrior) Smith lost in 1928. But the optimism runs much deeper than that, to the core of the faith. Behold! The flat tax shall set you free. “Cures bunions, too,” jibes Bob Dole.
Forbes’s warm-up banquet joke, repeated day after day, unintentionally reveals all: “I got today what the economists say can’t happen: a free lunch,” Forbes joshes. This message, spread with huge amounts of cash, threatens to do more than keep scrambling the 1996 campaign. Even if he doesn’t win the nomination, Free-Lunch Forbes has already maimed–perhaps irreparably–the Republican revolution and the larger cause of fiscal sanity.
Here’s why: When Newt Gingrich was plotting his revolution, he realized that the only issue uniting all Republicans was a balanced budget. Only supply-siders–a tiny faction discredited by the threefold increase in the national debt during the 1980s – dissented from making a balanced budget the centerpiece of the Republican takeover. When their leader, Jack Kemp, decided against running, Forbes jumped in, with nearly identical economic views but a much clearer way of expressing them. He is totally out of step with Gingrich and the House freshmen (this is a guy who spent years attacking a balanced-budget amendment in his magazine) but in step, apparently, with the GOP electorate. It may be that the skeptics were right all along: voters like to talk about their grandchildren–but they vote for themselves.
As this depressing point takes hold in the campaign, Dole and the others, trying desperately to bring down Forbes, are not spending much time touting a balanced budget. “You’re not going to see him focus on legislative issues,” says Mari Maseng, Dole’s communications director. Instead, the anti-Forbes strategy is to prove to Iowa and New Hampshire voters that the Forbes flat tax will hurt the middle class. “We hope people run those Forbes numbers,” says New Hampshire Gov. Steve Merrill, who’s personally taped an anti-Forbes ad for Dole. “Because when they do, they’re going to be for Bob Dole.”
Oh yeah? The Forbes campaign is confidently mailing a simple flat-tax form to every New Hampshire and Iowa Republican with the suggestion that voters do their own math. In New Hampshire, anyway, where the three biggest GOP campaign issues have always been taxes, taxes and taxes, large numbers of voters will take the two minutes to figure it out. Under the Forbes flat tax, a family of four would get $36,000 in standard deductions, with income beyond that taxed at 17 percent. Even without the home-mortgage deduction, lots of voters will find themselves at least marginally ahead.
The catch, of course, is that this is true only at the cost of a $180 billion to $200 billion explosion in the deficit. For the sake of appearances, Forbes argues otherwise. “Don’t fall asleep; just listen to this one number,” he says. “At the end of the ’80s, federal tax receipts were $200 billion higher than at the beginning of the decade.” His entire explanation for why the deficit won’t go up is based on “this one number.” Given that taxes were raised three times during the 1980s, it is a staggeringly irrelevant figure. “Forbes is just historically wrong that tax cuts have increased revenues,” says the Cato Institute’s William Niskanen, a former member of Reagan’s Council of Economic Advisers.
Presidential campaigns are only partly about candidates; they’re also about agenda-setting, and the Republican agenda coming out of 1996 is moving toward deja voo-doo budget-busting and away from responsible thinking about the deficit. (The trend can also be seen in Gingrich’s latest unbalanced budget proposal.) Forbes’s popularity suggests this is good politics for the GOP, but it isn’t. Beyond conservative taxophobes, where the larger country lives, tax simplification may catch on. But if the GOP abandons a balanced budget, Ross Perot or some imitator will step in, siphoning support. Then the Democrats will make quick work of a revolution that lost its moral strength in the snows of Iowa and New Hampshire.
