Why Robert Reich Fears the Tea Party

The Tea Party, one must say, is a mixed (tea) bag.

Parts of the group have been co-opted by the neo-cons, others, like Rand Paul, get it and will agitate for less government day in and day out.

Robert Reich knows that it is the Rand Paul flavor of  tea that needs to be feared. In an op-ed in today's WSJ, he writes that business should fear the Tea Party. What he really means is that the parts of big business, which are in bed with government, need to fear the Rand Paul led part of the Tea Party:

Even if it's now on the fringe, the tea party won't be for long. By fueling the Republican surge in the midterm elections, the tea party has become the single most powerful force in the GOP...

Beyond fiscal rectitude and less spending, tea party candidates are targeting the central institutions of American government. The GOP Senate candidate from Kentucky, Rand Paul, is among several who want to abolish the Federal Reserve. They blame the Fed for creating the Great Recession and believe that the economy would be better off without a single institution in Washington setting monetary policy. Even Maine's stolid Republican Party, now under tea party sway, has called for eliminating the Fed. In a Bloomberg poll a few weeks ago, 60% of tea party adherents wanted to overhaul or abolish the Fed (compared with 45% of all likely voters).


Another tea party target is the Internal Revenue Service. South Carolina Sen. Jim DeMint, who has emerged as the Senate's leading tea party incumbent, says that his "main goal in the Senate will not only be to cut taxes, but to get rid of the IRS." Mr. DeMint's goal is echoed by many tea party candidates, including Arkansas Rep. John Boozman, now running for Senate.

Here's a real hoot from Reich, where he gives it away that what big business really needs to fear is they might lose some of their handouts:

At the least, business leaders who complain about uncertainties caused by Mr. Obama's policies might be concerned. John Castellani, the former head of the Business Roundtable who is now running the Pharmaceutical Research and Manufacturers of America, told Bloomberg Businessweek this month, with remarkable understatement, "This kind of extremism makes it much harder to plan from a business perspective."


GE's Mr. Immelt may be unhappy with President Obama, but he'll be far unhappier if the tea party takes over the GOP. Tom Borelli, director of the Free Enterprise Project of the National Center for Public Policy Research, a conservative think tank and vocal supporter of the tea party movement, has demanded Mr. Immelt's resignation, calling GE an "opportunistic parasite feeding on the expansion of government." Among Mr. Immelt's alleged sins: taking federal subsidies for clean energy. In a press release last week, the National Center for Public Policy Research stated clearly: "Liberal CEOs are the next target for tea party activism."

Tea partiers aren't just against R&D subsidies. Almost two-thirds of tea partiers in the Bloomberg poll said they'd be willing to reduce research funds for Alzheimer's and other diseases to narrow the deficit; a similar proportion would consider cutting spending on roads and bridges.

Wall Street may be furious with the Obama administration but at least Mr. Obama (and his predecessor) bailed it out. By contrast, tea party activists consider the Troubled Asset Relief Program a betrayal of America. In the Bloomberg poll, nearly 70% of tea partiers said that they're less likely to support a candidate who voted for the bank rescue.

Underlying all of this is a deep tea party suspicion that big government is in cahoots with big business and Wall Street, against the rest of America. This has been the conventional view among leftist conspiracy theorists for years but it's now emerging full-throttle on the right.

If you follow Reich closely, as I do, you realize that he is clueless as far as economics, but he is a very savvy political observer.

He suspects the Tea Party will be trouble for big government types, and he's scared. However, it remains to be seen how co-opted various Tea Party "members" will become. Let's hope Reich's instincts on this are correct and that they do cause major problems for the big government-big business alliance.