Republicans Need New Leadership, Conservatives Advise

LAS VEGAS — The Republican Party needs a new generation of leadership, since so many Americans consider its latest batch of leaders as inept and corrupt, said Richard Viguerie, president of

This year offers a massive opportunity for conservative organizations to expand their membership, Viguerie told attendees at FreedomFest. Such organizations reasonably should expect to double their membership in the next year as spendthrift federal policies gain momentum, he added.

Republicans need to go back to providing a clear alternative to the Democrats the way that the party did when it challenged Jimmy Carter’s policies when he was president and the economy floundered, Viguerie said. .

The Republican Party also needs to reestablish its organization to support the emergence of its next wave of leaders, Viguerie said.

Tensions exist in the conservative movement but planning is underway to rally forces around a common agenda, Viguerie said. Traditional conservatives never will agree totally with libertarians, and vice versa, but they need to be able to work together, he added.

Washington has proven to the problem more than the solution, said Tom Phillips, an entrepreneur who also is the chairman of Eagle Publishing.

In response to a question, Phillips said that the structure of the political system and election laws make it very difficult for a third party to emerge, so it is best to restore an existing party to champion conservative policies, as well as the benefits of freedom and what it means for each individual. It is worthwhile to acknowledge that libertarians have more in common with conservatives than they do with the left, Phillips said.

In addition, more business people need to invest in media companies, Phillips said.

Advocating Diversity

Well-heeled “rhinos” attempt to run the Republican Party today, said Tom Fuentes, a senior fellow at the Claremont Institute and a former chairman of the Republican Party in Orange County, Calif. Republicans need to attract Hispanics and more people of color, he added.

Hispanics believe in hard work and in family values, Fuentes said. Those ideals are consistent with the traditional values of the Republican Party, he added.

Indeed, legal Hispanic immigrants seem to resent illegal Hispanic immigrants as much as anybody, Fuentes said.

Conservatives should plug into the media that exists to support their interests, such as Regnery Books, Red State and, Fuentes said.

Washington is run by policy wonks at think tanks, said Jon Utley, associate professor of American Conservative and a longtime conservative activist.

A big problem that exists in Washington is gerrymandering, since it helps to protect the seats of elected lawmakers by creating safe districts, Utley said. Entrenched lawmakers tend not to make difficult yet necessary decisions.

Fiscal Stimulus Will Not Rescue the Economy, Forecasters Say

Federal spending aimed at stimulating the economy is a flawed strategy that diverts resources from where the free market otherwise would direct the money to go, said Tom Woods, a best-selling author of Regnery Publishing, who also spoke at FreedomFest Friday.

“We’ve been listening to the quacks long enough,” said Woods, who spoke about Meltdown: A Free Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government  Bailouts Will Make Things Worse. Instead, people need to start listening to those who “actually know” what they are talking about, he said.

The Obama administration’s pursuit of federal stimulus spending to spark the struggling U.S. economy has not come remotely close to fulfilling its objective, nor will it be able to do so, Woods said. One example of using government money in an attempt to spur economic growth occurred in Japan, where the economy has contracted 15% since its government tried the technique, Woods said.

Faltering Fed

Another problem plaguing the U.S. economy is the Federal Reserve’s loose money policy that is devaluing the dollar, as well as increasing private and public debt, Woods said. 

“Only a fool would try to save by piling up dollar bills,” Woods said.

When government policies interfere with interest rates in the economy, it creates an imbalance between free-market supply and demand, Woods said.

“Interest rates create a crucial, coordinating function,” Woods said. When the Fed discourages savings by taking action to lower interest rates, it runs the risk of causing market bubbles, he added.

The 11 interest rate cuts orchestrated by then-Federal Reserve Chairman Alan Greenspan helped to pump up the housing market and to form the bubble that ultimately burst later in the decade. Greenspan explained during the recent bubble that it shows the free market has a flaw, Woods recalled.
“To Alan Greenspan, I would say, ‘we have found the flaw and it is you,’” Woods said.

A person could be considered a “crank” for not questioning the Fed’s easy money policy that creates boom and bust cycles, Woods said.

Although Woods is among those who advocate abolishing the Fed, there is no agreement about what would or should replace it, said John Fund, a columnist with The Wall Street Journal. The Fed’s mission could be refocused to keep the rate of inflation within certain targets. Any idea of eliminating the Fed without knowing what would replace it is like searching for a unicorn that doesn’t exist, he added.

Periodic financial crises could result if the Fed was abolished, cautioned Warren Coats, an economist and a former International Monetary Fund official to Bosnia and the Middle East Coats. In addition, the Fed does not control interest rates directly, he said.

In addition, the Fed took constructive action by opening up credit channels when the lending markets were stymied last fall, Coats said.

The demise of the Federal Reserve is needed to restore accountability in the financial system, countered Gene Epstein, a columnist with Barron’s and a former chief economist with the New York Stock Exchange. Adjustable rate mortgages, fueled by the Fed’s monetary policies, drove the housing bubble, Epstein said.