If by some distant chance Bush adviser Karl Rove is pushed out of the White House by the Valerie Plame/CIA kerfuffle, it would be to the detriment of pro-growth economic policies and conceivably the stock market and economy too.
What the mainstream media have missed is that the influential Mr. Rove is not simply a political adviser but a key supply-side economic voice in the Bush administration. In fact, many hold Mr. Rove is President Bush’s top economic adviser.
Most political insiders believe Mr. Rove was instrumental in persuading George W. Bush to stay with personal-saving-account-type Social Security reform in both the 2000 and 2004 election races. In my interview with Mr. Rove last winter, he was the first senior Bush official to come down against raising the Social Security tax wage cap. He also called the U.S. an IRA/investor-class nation that will never look back.
Mr. Rove knows full well roughly three-fifths of all voters come from the investor class. That is why in 2003 he strongly supported reducing tax rates on investor dividends and capital gains, a strategy that has helped propel the U.S. economy at a 4 percent annual rate over the past two years.
Not surprisingly, Mr. Rove is a long-time admirer of Ronald Reagan. A few months ago, at a speech at the Reagan Library in California, he praised the Gipper as a champion of free markets and entrepreneurship. In particular he noted Mr. Reagan’s view “that government’s duty is to remove roadblocks to economic growth … end regressive taxation and regulatory policies that penalize hard working men and women … and help encourage small business and enterprise to flourish.” Mr. Rove quoted the great classical free-market thinker Ludwig von Mises that “capitalism has raised the standard of living among the masses to a level which our ancestors could not have imagined.”
Mr. Rove also said because of Ronald Reagan, the debate over the merits of capitalism versus a command-and-control economy has been settled, the free market won in a rout and economic growth and prosperity have followed in its path.
This is weighty stuff for someone generally thought of simply as a political organizer.
In a recent hard-hitting speech to the New York Conservative Party, Mr. Rove said: “Conservatives believe in lower taxes; liberals believe in higher taxes. We want few regulations; they want more. We believe in curbing the size of government; they believe in expanding the size of government.”
He emphasized the conservative reform agenda with ownership replacing entitlement, welfare reform superseding dependence and Social Security reform benefiting ordinary working people by tapping into the markets. He said conservatives must always and everywhere oppose job-killing tax increases.
In the hurly-burly of Washington politics and punditry, Mr. Rove’s supply-side investor-class approach to economic policy is nearly always overlooked. While media mavens constantly search for “gotcha” political points, they seldom take time to read the words that truly reveal the underlying philosophies and policies of our major figures. Anyone who combs through Mr. Rove’s work will discover a deep policy thinker who has consistently given the president sound advice based on an optimistic worldview of growth and prosperity.
Indeed, Mr. Rove is the rare political adviser who understands that good pro-growth policies lead to successful politics. There’s no question Mr. Rove is in fact a brilliant political strategist, but he is also an uncommon thinker who understands the economic underpinning of winning elections.
I don’t think there’s anything to the case against Mr. Rove, but that must be left to the special prosecutor and the grand jury. My point is the economic angle: Let’s hope we don’t lose the strong pro-growth advocate we have in Karl Rove.
Lawrence Kudlow is host of CNBC’s “Kudlow & Company” and is a nationally syndicated columnist.