Sarah Palin, in what was billed as her first speech overseas, spoke on Wednesday to Asian bankers, investors and fund managers. A number of people who heard the speech in a packed hotel ballroom, which was closed to the media, said Mrs. Palin spoke from notes for 90 minutes and that she was articulate, well-prepared and even compelling. "The speech was wide-ranging, very balanced, and she beat all expectations," said Doug A. Coulter, head of private equity in the Asia-Pacific region for LGT Capital Partners. "She didn't sound at all like a far-right-wing conservative. She seemed to be positioning herself as a libertarian or a small-c conservative," he said, adding that she mentioned both Ronald Reagan and Margaret Thatcher. "She brought up both those names." Mrs. Palin said she was speaking as "someone from Main Street U.S.A.," and she touched on her concerns about oversized federal bailouts and the unsustainable American government deficit. She did not repeat her attack from last month that the Obama administration's health care proposals would create a "death panel" that would allow federal bureaucrats to decide who is "worthy of health care." – New York Times
Dominant Social Theme: Ronald Reagan redux?
Free-Market Analysis: Sarah Palin is apparently trying to resurrect the successful Republican – "conservative" – formulation that marked Ronald Reagan's tenure in office 20 years ago. Readers of the Bell will not be surprised. We predicted this back in early July when we wrote of the Republican party's disarray. We pointed out that portions of Republican rhetoric were inevitably free-market oriented but that George Bush's terms in office had so degraded the credibility of the political franchise – brand – that it was difficult to position oneself successfully under the party umbrella. Here's some more of what we wrote three months ago about Palin:
In the past we have noted that the Republican party is pretty well split between Libertarian Republicans and Conservative Republicans. The Libertarian Republicans did not in fact have a voice until Ron Paul (R-Tex) emerged as a powerful candidate in the 2008 elections. The trouble with the establishment Republican party is that the wing of the party that Ron Paul represents is strong and getting stronger. It appeals actively to conservative Democrats and would actually be a fairly strong base around which to coalesce.
The problem, then, becomes how to take back control of the Republican party – an admittedly damaged brand – without granting Ron Paul the control that he and his supporters wish to take. The conclusion of the leadership wing of the Republican party is apparently that they need to launch new faces and rebrand the party. Sarah Palin fits both needs. She is a relatively fresh face on the Republican scene (a woman, too) – and just to make sure that the rebranding is complete, she is likely to help launch a new party. …
The second step of outflanking the Libertarian Republican movement – as we have said – is to create a new party, the Conservative Party. Since third parties are almost impossible to win with in America, the chances are good that this party shall exist in name only or shall be folded back into the larger Republican party at some point. It is actually a flanking effort intended to ensure that the Libertarian wing of the Republican party does not surge forward and become a fully fledged mainstream effort.
Sarah Palin may or may not launch a new party. In fact, her braintrust may have decided to dispense altogether with the interim step. But she is doing, nonetheless, exactly what we expected, positioning herself as a strong free-market conservative – albeit with powerful establishment sponsors – more radical in some ways than Ron Paul himself, the leading libertarian light in Congress. Here's some more from the New York Times article about her recent speech:
Cameron Sinclair, another speaker at the event, said Mrs. Palin emphasized the need for a grassroots rebirth of the Republican Party driven by party leaders outside Washington. … "She's definitely a serious future presidential candidate, and I understand why she plays so well in middle America," said Mr. Coulter, a Canadian. Accompanying Mrs. Palin to Hong Kong was Randy Scheunemann, the former foreign policy adviser to John McCain, who lost the 2008 election to President Obama. … A CLSA spokeswoman declined to confirm a rumor that Mrs. Palin was paid $300,000 for her Hong Kong appearance. …
Mr. Coulter said CLSA has a history of inviting keynote speakers who are "newsworthy and potentially controversial." Other previous speakers at the conference have included Al Gore, Alan Greenspan, Bono and Archbishop Desmond Tutu. … Melvin Goodé, a regional marketing consultant, thought Mrs. Palin chose Hong Kong because, he said, it was "a place where things happen and where freedom can be expanded upon."
"It's not Beijing or Shanghai," said Mr. Goodé . "She also mentioned Tibet, Burma and North Korea in the same breath as places where China should be more sensitive and careful about how people are treated. She said it on a human-rights level."
The attack on China, obviously premeditated, is intended to draw a distinction between American free-enterprise and whatever it is that China is becoming. It is also a justification for Palin's partiality to a strong military-police state. John McCain, who picked Palin as his vice-presidential running mate ran to the left on domestic issues and to the right on military and security ones. Palin's rhetoric in this regard outdid even McCain, though it is notable on this occasion that she seems to have de-emphasized the patriotic, pro-military sentiments that marked so many of her previous appearances.
Nonetheless, it is the conservative endorsement of the entire military industrial complex including the questionable conclusions of the 9/11 Commission report that makes Palin's emphasis of libertarian principles suspect. This is the underlying contradiction that Republicans and Conservatives struggle with. The espousal of free-market principles is an intellectually credible position for Ron Paul as he rejects the projection of America's military might overseas and the evolving Homeland Security behemoth at home. But Palin and other new faces of the "conservative right" want it both ways. They continue to endorse the overseas American empire, with its trillion dollar military expenditures, while somehow promoting libertarian points of view domestically.
Given that America has just created the biggest domestic intelligence apparatus in the world – Homeland Security – and given that this hundred-billion dollar behemoth is the projection of the corporate state made manifest, Palin's sentiments may be seen as questionable to say the least. It is difficult to discover intellectual congruence in a political perspective that demands less government while supporting – enthusiastically in fact – a national stance that involves the projection of armed might around the world in concert with the Western world's most aggressive domestic intelligence operation.
Yet Palin's aggressive free-market rhetoric is no surprise to us. In July we predicted this positioning as a necessary part of Republican rebuilding.
We can see the dilemma that the Republican leadership has faced. The Libertarian wing of the Republican party is gaining strength. But the Republican powers-that-be are oriented around the nation's military industrial complex. The battle that is being waged currently from a political standpoint is one to co-opt the agenda of Libertarian Republicans and then regraft that agenda onto a larger pro-military, pro-security platform. In order to do this, Republican leaders, in our opinion, are seeking new, undiscredited faces and are removing them temporarily from the party's damaged brand.
Sarah Palin and Joe Scarborough are part of a much larger and very clever rebranding process that seems to be grass roots but in our estimation is being run by Republican power brokers. There are probably no accidents in politics as Franklin Delano Roosevelt famously said, and the current expansion of the "conservative" trend is no accident either. It is not aimed at the Democrats, or even Barack Obama so much as it is aimed at controlling what such power brokers believe is truly dangerous, Libertarian Republicans and Ron Paul.
We see no reason to change our previous analysis or conclusion. (In fact, we are only surprised at the vehemence with which the Republican establishment's new faces have adopted libertarian rhetoric.) However, in the Internet era, it is difficult to see how the Ronald Reagan political formula is going to work – or work well, anyway. For one thing, Reagan was a real believer in smaller government and it is questionable whether many of the current crop of Republican faces are anything more than opportunists. Secondly, Reagan never attempted to confront either the failing monetary policies of the United States or its military industrial complex.
Reagan's free-market rhetoric was inviting to an American electorate that is still by and large pro small-government. But in the post-Internet era, with millions aware of the contradiction between an Empire and real free-market thinking, such political positioning may well not suffice. In fact, many of the voters that Palin hopes to reach may want to hear more about her position on fiat money and America's military industrial complex than general sentiments having to do with deregulation of business. This is the contradiction that the monetary elite must struggle with as it ponders how to retake control of both sides of the political conversation. Our bet is that they will have a great deal of difficulty doing so. The new faces of the Republican party – call them neo-libertarians – may face tough sledding when confronted with the real thing.