high inflation and stagnant growth—a toxic mix we called “stagflation.” Growth is anemic today not primarily because of high individual tax rates but because of excessive government regulation of businesses. Our focus on tax cuts for individuals not only leaves us open to the “tax breaks for the rich” sloganeering of the Left but seems irrelevant to the nearly 50 percent of the population who don’t pay federal income taxes today.
The second point that we need to address is that while the technological revolution has increased the material wealth of our society as a whole and improved the quality of life for allAmericans, it has also left our society more polarized. The new economy bestows a larger share of its rewards on the educated than the industrial economy did.
Ronald Reagan offered a remedy for what ailed America in 1980. He would be the last person to offer exactly the same prescription more than three decades later under quite different circumstances. We need a different game plan to achieve economic growth with an eye toward those whom the new economy has left behind. If we only promise more growth without addressing the 70 percent of young Americans who will not earn a bachelor’s degree, we will be shirking our responsibility to them and handing the Democrats an electoral club to beat us with. 2
So our critics are right—the American economy has changed dramatically since 1980, and our policies must reflect that change. But something else has changed as well—the American household—and it’s liberals who ignore this change. In 1980, 55 percent of black children were born out of wedlock, and the out-of-wedlock birth rate in the population as a whole was 18 percent. Today, almost three out of four black children are born without a father in the home, and over 40 percent of all American children will grow up fatherless. 3 Democrats can talk all day long about the “War on Poverty,” but the most effective antipoverty tool is a combination of work, education, and marriage. America created the new economy, but a fatherless America cannot produce the skilled and functional workers, particularly men, who will thrive in thateconomy. The liberal programs of the last fifty years are no solution to the problem of family breakdown, and neither are tax cuts. The severity of this problem grows exponentially with each new generation. If we don’t address it now, it won’t be long before our economy reaches the “do not resuscitate” stage.
Republicans need to remember the old adage that “people don’t care what you know until they know that you care.”
After losing the election, Mitt Romney acknowledged the party’s problem. Talking to a reporter while volunteering at a homeless shelter, he remarked that the men and women there “are used to being ignored, I guess. Mostly by people like me.” 4
I admire his willingness to shoulder some of the responsibility for the problem, but as a matter of fact, Romney has a splendid record of helping people in all walks of life. A leader in his church, he has been fully engaged in its philanthropic efforts over the years. As an employer, he showed his concern for even the most junior employee, and he has given millions of dollars to help those who are less fortunate. Mitt Romney is a model of compassion for those less fortunate than himself, but how many people know about it? He has lived the American Dream not only by succeeding in business and raising a beautiful family but also—and just as importantly—by serving those in need.
It should come as no surprise that Americans are the most generous people in the world. Study after study shows thatAmericans give more than anyone else to help their fellow man. We rank number one in the annual World Giving Index. 5 In 2013, Germany ranked twenty-second, India ninety-third, and China came in next to last, ahead of only bankrupt Greece. But what about American conservatives? Surely they are stingier with the