After eight years in power, conservatives are down in the mouth. The right feels as out in the cold as it was during the wilderness period, fifteen years ago; and this time it does not even have much of a communist menace to fall back upon.

Establishment Republicanism, as personified by George Bush, is in the saddle leading the nation under a conservative banner, but with a pragmatic agenda. The Republican Party itself is a captive, the indictment continues, so the only answer is for conservatives to turn away from all of this, establish a new party with a pure agenda, and to rush off to battle the GOP country club crowd.

Déjà vu: it is 1976 again and Ronald Reagan has been defeated for the nomination. The Republicans are led by Gerald Ford, and the only possible future for our party is more establishment control. So, from Kevin Phillips to Richard Viguerie, the goal becomes creating a new conservative party as the only possible route to power. Yet, as my opposing paper for a national meeting of conservative leaders just following the election in 1976 argued, we were on the threshold of taking over the Republican Party; and we needed to stay to complete the job.

An American political party is simply a set of electoral rules and a group of potential voters whose past feelings or future hopes identify them with it. The party is a legal and organizational shell that must be infused with vitality, vision, and leadership by a group with a mission. The task of a conservative movement in 1976 or 1990 is the same: to fill the Republican shell with its agenda. In 1976, that mission was accepted; and the result was impressive: eight years of conservative government, with hundreds of billion fewer dollars wasted by the national government, a shift of the action to the private sector and state government, and the way prepared for the end of communism in Eastern Europe and beyond.

Moreover, George Bush is no Gerald Ford. He is not even the George Bush of 1980, having shifted 45 degrees by learning from his former boss, President Ronald Reagan. As was predictable (and predicted) a year ago, Mr. Bush can be relied upon to do a competent, if not visionary, job of continuing what Reagan started. This will be chipped away in time by an aggressive Congress, but as George Bush told the Republican Convention, his mission is to carry out the Reagan agenda; and, whatever else President Bush is, he is not a liar.

What about the Republican Party in Congress? It is true that twelve House Republicans voted with the Democrats half of the time last year, that nine voted with them 60 percent of the time, five 70 percent of the time, and one 80 percent of the time. Ten House Republicans actually voted in Congress against their party more than did any Democrat. But these liberal Republicans are an endangered species. They are a score where they were a legion. In the party itself, whose structure in the 1970’s was under constant attack from the left, the annual liberal Republican assault on the party organizational rules at the Republican National Committee this year was so weak that its sponsor quietly admitted that he made the motion “simply to keep up tradition rather than with any thought of victory.”

For better of worse, there is no other home than the Republican Party for conservatives. The party already exists legally and organizationally in every state; no mean achievement. To recreate this would take an incredible amount of funds and talent, and, more importantly, time and energy. The laws of every state, to say nothing of the federal electoral rules, are biased to favor the two existing major parties. The option of having a third party, like the Conservative Party of New York, which has grown incrementally by adding votes to major party candidate totals, only exists in one other state, Delaware.

The electoral benefits of Republican affiliation are even greater than the organizational. Securing the nomination of the Republican Party immediately gives a candidate, through its “yellow-dog” vote, one-quarter of what is necessary to be elected. Indeed, over 40 percent of the electorate identifies as Republican, and they are overwhelmingly conservative by instinct and by policy preference. To toss away this legal structure and popular affection would be madness, when all that is needed is to fill the party’s legal shell with a conservative vision at a time when there is no real competitor upon the scene.

On the other hand, it is not enough just to polish up the old Reagan banner, to simply live off the ideas of the past. For the rhetoric has lost its vitality and its ability to inspire the public enthusiasm necessary to create a new mandate for the fundamental reforms of government that are needed for the future. Conservatives have a great luxury in being able to rely upon President Bush to carry Reaganism to its logical conclusion; but resting upon status quo conservatism over the long run is a recipe for disaster.

The 24th annual Survey of College Freshmen, conducted jointly by the University of California at Los Angeles and the American Council on Education, reported student activism this year higher than ever before, even than during the explosive 1960’s-70’s. Nearly 37 percent of the freshmen surveyed had participated in demonstrations the previous year, the highest proportion to date. Setting another record, 44 percent reported that it is “very important” for them “to influence social values,” while 35 percent (up from 27 percent in 1986) cited “helping to promote racial understanding” as an important goal. Finally, an all-time high of 20 percent said that “influencing the political structure” will be a major goal for them in the future. So youthful idealism is raising its head again, after several years of quiescence. The only question is whether liberals or conservatives will harness its energy.

The general public is stirring, too. The 1990 Washington Post focus group and poll—which in the last few years has been remarkably professional and has proved accurate—finds a public that feels uneasy about the future. While most Americans expect their own lives to improve, they are very worried about whether their children will have a good life: 71 percent are concerned whether the next generation will be able to find a good job, 86 percent whether they will be able to afford a house, and 85 percent whether their sons and daughters will be able to raise children of their own. People are also worried about their offspring today: their safety, the threat of drugs, and whether the moral fiber of the nation is strong enough to allow a peaceful and prosperous life for them.

Even on the core Reagan issue of government spending, when asked what they would do with potential government savings, only 5 percent said reduce taxes, while 24 percent said improve education, 17 percent said help the homeless, 15 percent fight drugs, 10 percent increase health care, 10 percent improve the Social Security system, and 10 percent support the environment—and they believe the Democratic Party is best able to deal with these problems.

It is true that even Democratic political analysts have concluded that the public does not want to raise taxes to do much about “liberal” issues. As has been the case for at least two decades, the people’s heads are with the Republicans, to act prudently, but their hearts are with the Democrats, as most willing to solve social problems. The most dramatic of the Post’s results is that people are extremely cynical about Washington’s ability to solve, or even its interest in, their problems. They see Congress, especially, as corrupt. The people have even learned that the President does not have the power: 53 percent saying that Congress has the most power, and only 15 percent the President. They like George Bush, but they realize that these problems are more fundamental than a President. They want problems solved, and they know that the government in Washington cannot master them.

This popular mood gives conservatives a marvelous opportunity to showcase one of their most fundamental values, federalism. “Federalist” is the term the Founders used to describe their own enterprise, using it to tide their major work. Federalism primarily refers to a government composed of state and local governments that have independent power, but the concept easily extends to include the idea of a national separation of powers and the limited purposes for which each branch of government was created.

The Founders emphasized divided powers because they believed men were not angelic enough to be trusted with total power, but not so devilish that they could not choose their rulers or live their lives freely by caring for themselves, their families, friends, and neighbors. As Thomas Fleming has reminded us, American government was created upon a principle of human nature, that human affection is naturally greater towards that which is closest: as Alexander Hamilton put it in The Federalist number 17, upon the “principle that a man is more attached to his family than to his neighborhood, to the community at large . . . than toward their local governments, than toward the government of the Union.”

Even until the 20th century, most economic activity in the United States was unregulated by national government, and 90 percent of government was local government. The national and state governments had only 10 percent between them. As noted by the first close observer of the new nation, Alexis de Tocqueville, the real vitality in the early regime was provided by voluntary associations and local government. The Progressive movement challenged both, regulating associations and business, and consolidating local governments using state government power. Under the leadership of Woodrow Wilson, the progressive ideology captured Washington in 1912, although its triumph had to await Franklin Roosevelt in 1932 and Lyndon Johnson in 1964.

But before the bureaucratic welfare state, our government was a federal government—one based upon the individual, the family, and private associations, protected by a local government, with a minimalist state providing a justice system and national government in reserve for only when truly needed—and it worked.

The challenge today is, simply, to reestablish The Federalist nature of the American republic. In a world where Eastern Europe is throwing off its statist shackles and much of the rest of the world is reassessing its bureaucratic heritage, it would be ironic indeed if the birthplace of liberty continued its drift away from its roots in freedom and federalism. It has taken 70 years of the welfare state for Americans to recognize that large national governments do not solve real social problems, thereby finally creating the conditions for the still-federalist people to accept a positive program based upon limited government that could truly revitalize the civic culture that created the American republic.

There is a great deal of talk from some quarters about America exporting its legacy of democracy to the world. But the Founders realized that democracy is not enough. Democracy works best closest to individual affections—within the family, the local community, and the municipality, but very inexactly at the state and national levels—and only then in a true federal system of decentralized powers. It was, de Tocqueville noted, that “fruitful germ of free institutions,” local government, that even introduced “the doctrine of the sovereignty of the people” into Western culture.

Democracy developed from the bottom because it worked there, and was not perfected until the Founders bound local units into a federal system of limited powers. When democracy is artificially imposed upon a national government without these limits, democracy is soon destroyed by its excesses, especially by unrestrained spending through overtaxing and regulating the productive middle class.

As Lord Acton noted, “the true natural check on absolute democracy is the federal system, which limits the central government by the powers reserved and the state government by the powers they have ceded. It is the one immortal tribute of America to political science, for states rights are at the same time the consummation and the guard of democracy.” It is summarized in the Tenth Amendment to the Constitution: the one essential civil right, that the powers not specifically ceded to Washington are reserved to the states or to the people.

America, then, should be selling federalism, rather than simple democracy, to the world. To a globe weary of statist excess, sickened by the millions of people killed, maimed, imprisoned, and impoverished by government, the United States should be teaching about private property and markets for prosperity, separation and division of powers nationally for safety, and local governments as the locus of democratic problem-solving. With all of the growth of state power in the 20th century, federalist systems like that of the United States, Switzerland, Canada, and even Australia and West Germany, still should be the model—and contrasted with stagnant, homogenous, and boring Sweden. Federalism is especially the model needed for ethnically diverse countries such as Yugoslavia, Czechoslovakia, and Eastern Europe generally, or Lebanon and Jordan, or even Ireland. The Soviet Union itself may be a prime candidate, as Amos Perlmutter and James H. Billington have both recently argued.

An even older notion, confederalism, may be ready for a revival. It is already the model for Europe ’92, and is the most obvious solution for bringing together East and West Germany. Looking even longer term, it may be a solution for Hong Kong/Macao, China (and eventually Taiwan), or even parts of Latin America. Solving problems (mostly by the parties involved themselves) would not just be an academic exercise, but could determine whether there may be regional or even world peace and prosperity.

To sell abroad, reform must begin at home. Here federalism is in dire need of revitalization. Both deregulation of the economy and decentralization of governmental decision-making has barely begun. Some major programs were block-granted to the states and cuts in Washington aid have encouraged local government and voluntary associations. But the national government still dominates domestic government policy. While its revenue has gone down from 61.7 percent of the government total in 1970 to 56.9 percent in 1985, the national government’s percentage of total government expenditures has actually grown from 62.5 to 65.3 percent, a long way from the Founders’ federal system. The Reagan-Bush era has merely slowed the pace of centralization.

Federalism is the essential term because it focuses upon the real threat to freedom—excessive centralized power, a power that frustrates the solution of problems by other means, claiming resources that could be better utilized in different ways. Take the “conservative” solution to use vouchers to replace direct Washington regulation. Without a notion of federalism, vouchers could be thought of as an ideal alternative to the status quo. It is true that vouchers are a freer solution than a rigid central plan implemented by a national bureaucracy; but vouchers are, at best, a second-best alternative. Indeed, as was noted by the finest analyst of 20th-century social processes, Joseph Schumpeter, vouchers are a socialist solution.

Vouchers assume that the national state knows how to dole out the correct amount of resources to pay for our various needs. The central planning board would determine how much in vouchers would be spent on health, welfare, education, housing, and so forth. This would be a freer socialism, since people could spend the vouchers within the broad categories, but a socialism nonetheless; for such a system imposes the “correct” amount of health, education, and welfare upon society. Those libertarians who dismiss “market socialism” as a contradiction in terms are wrong. Indeed, voucher socialism, as Schumpeter noted, is the only rational and potentially human form of socialism, and therefore much more attractive politically.

But vouchers do not change power. As the Founders taught and Acton demonstrated, the only successful way to deal with power is to divide it; and the history of destruction where this insight has not been heeded has merely emphasized its wisdom. While restructuring Congress as a citizen legislature to make it more representative, giving the President more authority over the bureaucracy, and selecting judges more sensitive to the original intent of constitutional rights, do readjust power in a more federalist manner, they do not reduce it. Central government power is diminished only by placing it somewhere else. If it moves from executive to legislative or judicial, it is still liable to abuse by the capital. The only solution to the problem of power is to privatize it, which means the central government simply moves out, or to de-nationalize it by switching revenue sources to some more local power.

The practical point is that as long as people demand government solutions to domestic social problems, federalism—the shifting of national government programs to local governments—will be an attractive alternative. Local government can solve problems better, is closer and more humane, and offers freer choice. The major problem of government still is central planning, which has an incredible ordering appeal for those without a philosophical or theistic explanation of the world. The goals of managing the economy, or rationalizing the environment, or recreating the world in the image of the family evoke deep emotions no matter how poorly central planning has worked in practice. A political program that cannot accommodate reasonable desires for government services (primarily utilizing market mechanisms to make them efficient) will not be relevant. If demands are limited by reasonable property and civil rights, local governments can satisfy those demands, and if there are many of them, can still allow freedom through popular choice of a community that most closely fits individual preferences for public good.

The conservative vision for the 21st century is as simple to conceive as it is difficult to accomplish. The goal is to complete the transformation from the national welfare state to a federalist society by making the recreation of federalism the vision for the Republican Party, and then for the nation itself George Bush and mainline Republicans can be relied upon to fight the good fight until 1996. But “no new taxes” is not a program for the long run. By definition, it is without a positive meaning, unable to inspire, especially for idealistic youth seeking new worlds to conquer.

The conservative movement’s mission is to transform the debate. It is not freedom or community, but communities in a structure of freedom. Federalism creates an economic market but also a market of governments, which allows different preference orderings for public goods to be established in different locations within geographical areas, and the national freedom to choose between them. In such a system, power is divided into a natural hierarchy that respects freedom and community, by relying first upon the individual and the family; then on local voluntary and community organizations, private businesses and corporations; then municipalities, counties, and states; and only, as last resort, Washington—a definition of the free society Gallup still finds supported by 80 percent of Americans.

The welfare state, crafted in the early 20th century by Woodrow Wilson, collapsed in stagflation under Jimmy Carter because it did not work. Then Ronald Reagan began the long climb back to free and federalist principles, with George Bush still carrying the mission forward. But the conservative movement must now complete the march by raising the bold colors of federalism as the center of its agenda to extend freedom into the next century.