At National Review, Jonah Goldberg notes an observation by Friedrich Hayek: “It has . . . invariably been the fate of conservatism to be dragged along a path not of its own choosing.”

Whether it’s the fiscal cliff negotiations, entitlement spending, or any other form of government expansion, the progressive agenda steams ahead, dragging and ripping from the ground the constitutional and conservative roots of this country. Conservatives never win on core principles. Our successes only slow the rate of acceleration toward leftist domination.

Goldberg highlights federalism, where each individual state would regain the powers our constitution assigned it, as the path to proactive conservative re-emergence. We agree with the merits of federalism. However, the deck is stacked against that prospect. The federal government has too much leverage over the states.

So what’s the roadmap for returning to federalism?

We’ve already written about the need for conservatives to infiltrate pop culture and proactively set our own memes as we engage in the campaign to reassert the positive moral values and economic advantages of conservative ideas. Fertilizing the cultural grounds is necessary for conservative seeds to flourish.

What about the political side?

Conservatives tend to fight political battles on a policy-by-policy basis, while Progressives push to radically alter the relationship between citizen and state through laws such as the PPACA (Obamacare). Conservatives need to start playing that same long game.

In an entry to the National Review Institute’s 2010 policy contest, I made a series of recommendations, which received honorable mention as a finalist in the competition. These five ideas are bold, long term solutions (including some that libertarians have championed) that would get our government more in line with the Founders’ vision.

Agree? Disagree? We’d love to hear from you. Here’s the list: 

An Incremental Approach to a Federalist-centered Tax Policy to Deter the Centralization of Revenue and Power

There is an incremental path from the current structure and assumptions of the nature of the federal government toward a decentralized, republican form of governance and taxation, in the form of the elimination of the direct tax of individuals to be replaced by taxation of the states. The precedent for this is taxation of corporations as separate legal entities apart from the individuals employed by the corporations.

There are five major steps toward achieving this end.

1. Reinforcement of the family as the ideal base unit of society

a)    Create a tax deduction for funds spent on self-education by a parent

1. This would allow displaced workers with outsourced jobs to retrain for new work while their spouse is still working.

b)    Focus exclusively on allowing health insurers to sell across state lines

1. This would cause an immediate and slight decline in the acceleration of health insurance costs, showing a promising first step toward easing this uncertainty, and would start a subtle shift away from reliance on big government.

c)    Increase the child tax credit

1. This would encourage tax-paying and theoretically fiscally-sound parents to have more children.

d)    Eliminate the withdrawal tax on 401Ks

1. This would add a sense of personal independence and security, knowing that money invested will not be deducted at an unknown tax rate decades from now. It would also encourage more investment.

e)    School choice vouchers

1. This is long term in its consequences but immediate in the sense of control and responsibility it returns to parents.

Rather than a ‘Contract with America’, this will be ‘The Year of the Middle Class’, which in reality will be a package of family-centered legal and tax changes to strengthen families and eliminate the need for and outsourcing of parenting to the federal government. The average middle class family wants a sense of security in their lives, and broad-based tax cuts at this level have less appeal than they once did. These targeted tax breaks also avoid the politically unpalatable concession by the left of eliminating the progressive income tax structure (with the exception of the vouchers).

2. Modification of the UMRA (Unfunded Mandates Reform Act) to eliminate all unfunded mandates by the federal government

While this reform has been viciously opposed in the past, with the current fiscal blight devastating government at all levels, momentum for a new version of the UMRA may have enough traction to add some teeth beyond its reporting requirements, as well as including language that would prevent burdensome mandates such as No Child Left Behind. Couched within the text of this new legislation, Congress could also execute its constitutional authority to regulate federal courts and keep them from imposing the same kind of mandates in their rulings. This second part is D.O.A. with the leftist bent of the current Congress, but may be more plausible if/when a Republican majority returns to power.

3. Eliminate the federal government’s ability to directly finance state and local government

Pass law/amendment: The federal government shall distribute no funds to state or local governments, or to any non-federal entity or institution. There would be a clause clarifying that defense department, state department, etc, can still engage in private contracts for departmental support. (To distribute funds, government must directly receive services from a wholly private entity in return). Over time, as federal funds dry up, states will be forced to raise taxes. This will cause popular backlash against federal taxes, creating momentum for eliminating direct federal taxing all together.

4. Pass amendment that also repeals the 16th amendment

The federal government shall have no power to directly tax the population of the several states. All federal taxes will be derived from state treasuries by means determined by Congress, but such taxation shall be uniform throughout the United States. This would limit the federal government’s ability to give special tax breaks to favored constituencies and prevent social engineering through the tax code. This would in turn create momentum for the final step.

5. Repeal the 17th amendment

Once taxation by the federal government directly affects the state governments, these governments, empowered by years free from federal interference and from greater ability to tax the population, will want direct say in the levels of taxation imposed. The presumed subsequent reduction in federal funding would in turn put pressure on policymakers to reign in entitlement costs.

Conclusion

This decades-long process would result in a political dynamic in which tension and better balance of power between not only the three branches of government, but the federal and state levels of government, will contribute to more ‘competitive government’, in which a state’s power will be determined not by long serving members of Congress that can cover for poor fiscal decisions by state governments by allocating more federal tax revenues for their states, but by the state governments’ own capacity for good governance.