06/30/2013 07:58 pm ET Updated Aug 30, 2013

For GOP Demographics Are a Concern, But the Party Has a Bigger Problem

Hunter S. Thompson's Songs of the Doomed recalls the journalistic consensus following Barry Goldwater's trouncing in 1964: "The GOP was doomed, like the Whigs, to a cheap and meaningless fate." Political commentary has long been prone to overreaction, and the hyperbole has again shifted to the impending doom of the Republican Party. In the aftermath of a failed 2012 White House bid, no less than reputed conservative commentator, George Will, concluded that "The Republican Party, like today's transfer-payment state," is endangered by its failure to grasp that "demography is destiny." However, despite the panic, GOP extinction will again prove a prophesy unrealized, and the hysteria engendered by such fear papers over a more important lesson from 2012: Republicans must reassess the opportunity cost of anchoring a national agenda in 'social' issues. First, those reading the tea-leaves of the Hispanic vote should take a closer look. In 1976, Gerald Ford, the Republican Presidential nominee, received 24 percent of the Hispanic vote. Just four years later, Ronald Reagan fought the Hispanic vote to a near draw, garnering 42 percent. In 1996, Republican Nominee Bob Dole garnered just 21 percent of the Hispanic vote. Yet, in the following two elections George W. Bush would rebound to receive 35 percent and 44 percent of the Hispanic vote, respectively. The 1996 election bears similarities to 2012's contest: A younger, more empathetic incumbent won over the lion's share of the Hispanic community. Indeed, Mr. Romney's differential of -20 percent between his share of the popular vote and the Hispanic vote, 47 percent and 27 percent respectively, was exactly the same as Mr. Dole's, as he garnered 41 percent and 21 percent, respectively, in 1996. Alarmists draw fear from the fact that Mr. Romney won 59 percent of the white vote and still couldn't win the election; but they lose the forest in the trees. Romney won 59 percent of the white vote in large part because he resigned himself to a limited ceiling with other constituencies, in this case Hispanics. Whispers of self-deportation were a tip of the hat to an isolationist, and predominantly, white, wing of the Republican Party. Following the election, many seemed to discern the 'white vote' and 'Hispanic vote' as mutually exclusive, hence the panic about Romney losing 'despite receiving 59 percent of the white vote.' In reality, demographic voting blocs are fluid, and to push votes higher in one bloc, a candidate must often pull votes lower in another. Further, addressing predictions of extinction, the two-party system inherently makes prolonged single-party dominance unlikely. Political constituencies are, implicitly, rent-seekers. These rents can be 'economic' (i.e., businessmen supporting a candidate who wants to reduce corporate taxes) or these rents can be 'social' (i.e., Evangelicals supporting a candidate who is 'pro life.'). Limited resources make a permanent majority constituency unstable. For example, if 'Party A' attempted to divert all of the country's resources to a chosen 99 percent of the population, 'Party B' could simply promise to devote all of these resources to a chosen 51 percent of the population. In theory, Party B would prevail with a 51 percent popular majority, because it would offer more 'rent' per person to the chosen 51 percent than Party A. Tellingly, despite meaningful demographic shifts, the presidency has been roughly split between the Parties since World War II. In a two-party system, barring political censorship, the losing party will tend to adopt or undercut the most successful positions of the opposition. Loss of relevancy is possible in a multi-party system because it is more difficult to undercut rival parties that appeal to narrow constituencies. A recent exemplar is the Progressive Conservative Party of Canada, which after a decade of declining popularity within a multi-party system, dissolved and merged with a rival in 2003. Finally, a preoccupation with 'demographic destiny' and the Oval Office risks glossing over a larger concern. Despite holding the presidency with equal frequency, Republicans have watched the proportion of federal spending devoted to transfer programs balloon from one-third 50 years ago, to roughly two-thirds today. This long-term trend does not stem from losing elections, but from the inefficient allocation of political capital. British philosopher Bertrand Russell once wrote:

Where the issue is simple and public opinion is definite, the plutocracy is powerless; but where public opinion is undecided, or baffled by the complexity of the issue, the plutocracy can secure a desired result.

The 2012 Republican Presidential primaries were preoccupied with social issues, namely same-sex marriage and abortion. These issues are no doubt important, but they are necessarily matters of personal introspection, and voters are less likely to have opinions informed by 'facts' offered by political actors. Indeed, more often than not in such matters, roles are reversed, and popular opinion actually guides political sentiment. In 1996, when public support of same-sex marriage stood at 27 percent, it would have been unthinkable for a president to be an advocate; today, with support doubled at 53 percent, such advocacy may be a political advantage.

The national spotlight afforded by presidential contests would be better utilized on matters of fiscal balance and economic policy. The average American is unlikely to have the time to delve into the perverted incentives presented by expanding transfer programs or the impact of future debt-servicing costs, so 'facts' can make a real difference.

As opposed to social issues where choices are often binary, fiscal and economic matters present endless potential policy options. Even in a losing effort, a candidate who presents a compelling case for fiscal responsibility can alter public opinion, forcing an opponent to moderate his own views for fear of popular ire.

A reference to 1996's campaign is again helpful: Mr. Dole's platform identified balancing the budget as his primary concern. Just two years later, the federal government ran a surplus for the first time in a generation. Perhaps President Clinton's administration would have achieved fiscal balance regardless; but Republican focus on the issue at least provided Clinton with valuable political cover within his own party during the process. Then, just as now, if Republicans can present a compelling case to the public, they will not have to wait until 2016 to make an impact.