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Rand Paul Does Not Oppose Big Government

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Rand Paul's comments last week about the Civil Rights Act of 1964 (and his subsequent back-track) have prompted some discussion of his philosophy of government. But leaving aside a broader discussion of libertarianism or so-called small-government conservatism or however Paul chooses to label himself, one fundamental problem with that discussion is that it's built on a false premise - that Paul and people like him actually oppose an active government role in the economy.

In his must-read book, The Conservative Nanny State, here's how Dean Baker frames the issue:

Political debates in the United States are routinely framed as a battle between conservatives who favor market outcomes, whatever they may be, against liberals who prefer government intervention to ensure that families have decent standards-of-living. This description of the two poles is inaccurate; both conservatives and liberals want government intervention. The difference between them is the goal of government intervention, and the fact that conservatives are smart enough to conceal their dependence on the government.

Conservatives want to use the government to distribute income upward to higher paid workers, business owners, and investors. They support the establishment of rules and structures that have this effect. First and foremost, conservatives support nanny state policies that have the effect of increasing the supply of less-skilled workers (thereby lowering their wages), while at the same time restricting the supply of more highly educated professional employees (thereby raising their wages).

Baker details a range of policy areas - from licensing requirements to rules of incorporation - that entail fundamental government intervention in the market in ways that massively benefit well-connected economic interests at the expense of the vast majority of Americans. To give one example relevant to Rand Paul, since Paul is a doctor - in the mid-1990s, the AMA succeeded in pushing through significant limitations on the supply of doctors in the United States. As Baker points out, no one denies that doctors need to pass competency exams before they can be licensed to practice. But these Congressionally-imposed restrictions, especially on foreign-born and trained doctors doing residencies in the United States, have no relationship to their competency. They serve one purpose - to restrict the supply of doctors, thereby increasing the cost of purchasing medical services (and, therefore, doctors' salaries). The cost to the typical consumer of this clear restraint on trade and free movement of labor is enormous and a significant factor in our astronomical national health care bill (as are various other government interventions in the market, like our increasingly out-of-whack patent laws, a key reason why we pay higher drug prices than any other rich country).

Focusing only on government intervention in the supply of doctors, Baker argues:

If free trade in physicians brought doctors' salaries down to European levels, the savings would be close to $100,000 per doctor, approximately $80 billion a year. This is 10 times as large as standard estimates of the gains from NAFTA.

One can debate the trade-offs inherent in changing the status quo in the area of physician licensing. But one would be hard-pressed to deny that the status quo entails significant government interference in the marketplace. Yet, one can assert with confidence that Rand Paul is never going to say a peep about this form of government intervention, despite the massive costs to consumers it entails. (Paul, also unsurprisingly, does not oppose Medicare. Opthamologists see lots of seniors).

Paul's website asserts that he "opposes all federal bailouts of private industry." Why? Because America should "allow the responsible to replace the reckless in the marketplace. America is the land of opportunity, to succeed and to fail. It's time our government starts promoting responsibility."

Interesting. So, when faced with a nice first test-case in his career in the national limelight, what did Paul have to say about BP and the catastrophic oil spill? Here's what he told George Stephanopolous:

I've heard nothing from BP about not paying for the spill. And I think it's part of this sort of blame game society in the sense that it's always got to be someone's fault. Instead of the fact that maybe sometimes accidents happen. I mean, we had a mining accident that was very tragic and I've met a lot of these miners and their families. They're very brave people to do a dangerous job. But then we come in and it's always someone's fault. Maybe sometimes accidents happen.

As Bradford Plumer commented:

Ah yes, the "oops" defense. But let's focus in on Paul's bit about "I've heard nothing from BP about not paying for the spill." We now know that the oil company has been wildly lowballing the amount of oil leaking from the well: BP originally claimed 5,000 barrels per day, but that hasn't survived scrutiny, especially after video of the leaking pipe was made public. And why was the oil giant understating the amount? One possible motivation, as McClatchy reported, is that BP's low-end estimate "could save the company millions of dollars in damages when the financial impact of the spill is resolved in court."

Note also that BP isn't fully on the hook for the spill. Under current law, the company is obliged to pay direct cleanup costs, but its liability for indirect damages to wildlife or fisheries or beaches is limited to $75 million--and with the crude slick now lapping at the coastal wetlands of Louisiana and possibly spreading up through Florida, the total costs are surely going to be much higher than that. In essence, the government has socialized the risk BP and other drilling companies face. Surely that would bother a staunch libertarian like Paul, right? And yet Senate Republicans have been blocking attempts to raise the liability cap to $10 billion, and Paul hasn't said a word on the subject. Odd, that.

Let's be clear - Paul's position on BP and his attempt to deflect blame on their behalf means that Paul, by definition, supports a bailout. Because someone is going to pay, and pay dearly, for the ongoing gusher of oil in the Gulf of Mexico. And if that someone isn't BP (which, as Plumer noted, has already had its liability artificially limited by government intervention), it's going to be the US taxpayer (and here's one small taste of the impact that the spill is already having).

It's true that Paul has said he opposed TARP and other bailouts of big financial institutions. So it's possible for his defenders to argue that he's not merely a shill for large economic interests in general. But it's hard to take those positions seriously when - given the opportunity as a public figure to apply his philosophy to businesses whose massive screw-ups have done enormous economic damage and resulted in dozens of deaths (including the recent mining accident in West Virginia Paul mentioned) - Paul instead chose to whine about unfair "blame."

This is especially relevant to the Tea Party, of which Paul describes himself as a proud standard-bearer. The opening salvo in the Tea Party's war to take back America was the Santelli rant in February of 2009, when the CNBC correspondent fulminated against the un-American act of aiding distressed homeowners. The message was clear: taxpayers should not be responsible for paying off bad mortgages when those homeowners ("losers") had no one to blame but themselves.

Does Rand Paul think that Santelli was wrong to place blame on those homeowners, since we spend too much time assigning blame in this society and that sometimes bad things happen and it's nobody's fault? If Paul is a card-carrying member of the Tea Party, who thinks holding people responsible for their actions is appropriate and therefore opposes bailouts in general, why is he defending BP? How has he decided that "blame" is an inappropriate response to the oil spill (and also to the mine disaster in West Virginia), but that accountability and responsibility are the appropriate response to others in distressed circumstances?

The answer is that Paul's supposed fealty to the principles of limited government and personal responsibility are incoherent at best and blatantly hypocritical at worst. Like all too many who espouse his philosophy, what Paul believes most fervently is that those at the bottom should fend for themselves in a free society while those at the top are entitled to free-ride on everybody else.

Jonathan Weiler's second book, Authoritarianism and Polarization in American Politics, co-authored with Marc Hetherington, was published in 2009 by Cambridge University Press. He blogs about politics and sports at www.jonathanweiler.com