What Is the Tea Party Movement? Its Economic Platform and History
4 Truths About the Tea Party
The Tea Party movement is a populist branch of conservative Republicans. It opposes government spending, taxation, and regulation. That's how the government infringes on Americans' personal liberties as outlined in the Constitution.
They are mostly middle-class (65% vs. 50% nationally). More than a third (37%) are college graduates or beyond (vs. 25% nationally). Nearly half (47%) are members of the Christian right.
Many of them are small business people, who must stay profitable despite narrow margins. They see taxes, regulations, and Obamacare as direct threats to their livelihood.
They consider themselves full members of the Republican Party, who want to move it back to a more pure form of conservatism. They feel threatened by the new demographics in America, as symbolized by President Obama's election. They sense they are becoming a minority regarding their religion, values, and way of life. (Source: Washington Post, Galston: The Tea Party and the GOP Crackup, October 15, 2013)
The Tea Party's Economic Platform
The Tea Party's economic platform follows its overall belief that less government is good. The free markets are the best generator of jobs and economic growth. The Tea Party quotes former-President Ronald Reagan, “The government’s view of the economy could be summed up in a few short phrases: If it moves, tax it.
If it keeps moving, regulate it. And if it stops moving, subsidize it.”
Here are the Tea Party's four primary economic policies:
- Eliminate the national debt. It creates a burden for the next generation of Americans and slows economic growth.
- Eliminate deficit spending and balance the books as would be expected of any American business.
- Eliminate excessive taxes, which prevent families and small businesses from pursuing wealth.
- Protect free markets by deregulating business.
Eliminate Deficit Spending and the National Debt.The Tea Party is serious about reducing government spending. Their point is that out of control government spending infiltrates the government into Americans' lives, devalues the dollar, and invites inflation. Tea Party members quote Alexander Hamilton , who said, “As on the one hand, the necessity for borrowing in particular emergencies cannot be doubted, so on the other, it is equally evident that to be able to borrow upon good terms, it is essential that the credit of a nation should be well established.”
In 2013, the Party shut down the government and nearly refused to raise the debt ceiling. Why? It wanted to defund Obamacare. It included cuts to Medicare, Social Security, and Medicaid as part of the conversation.
The Party risked government shut-downs in 2011. In April, it refused to approve the FY 2011 Budget until $80 billion was cut. But a CBO report said that spending would only decline $38 billion. As a result, rating agency Standard & Poor's lowered the outlook on whether the United States could repay its debt.
In August 2011, the Tea Party delayed voting to raise the debt ceiling until $2.2 trillion was cut from spending over the next ten years in the Budget Control Act of 2011. As a result of a near default on the debt, the S&P lowered the U.S. debt rating from AAA to AA+.
Eliminate Excessive Taxation. In 2011 the Party opposed Obama's American Jobs Act. He planned to fund it through tax increases to those making more than $200,000. He wanted to close tax loopholes for oil companies. Tea Party members argued that the top 10% of earners pay 70% of taxes, while the bottom 46% pay nothing. (Source: Fox News)
Protect Free Markets. There is some dissension on what this means to various Tea Party members. Some, such as Americans for Prosperity, are for free trade agreements. Others believe these agreements send jobs overseas.
The Theory Behind Tea Party Policies
The Tea Party reflects the values of Andrew Jackson -- self-reliance, individualism, loyalty, and courage. Followers are suspicious of federal power. That's why they are such avid supporters of the Second Amendment. Therefore, they also oppose federal taxes and regulations that hurt small businesses and the entrepreneurial spirit that built America. That makes them anti-elitist. They believe ordinary people are wiser than the experts. They think seemingly complicated problems have simple solutions.
Most Tea Party members emulate the accomplishments of Ronald Reagan's Presidency and Reaganomics. Both are based on supply-side economics. It states that lower taxes will stimulate enough demand to replace any lost tax revenues. The Laffer Curve demonstrates precisely at which point lower taxes will result in higher tax revenues. But Laffer warned that it all depends on how high taxes are. Laffer's "Prohibitive Zone" starts when the tax rate is at 50%. If the rate is lower, then cutting taxes could slow economic growth by increasing the debt.
Tea Party History
The Tea Party took its name from the 1773 protests in Boston, where colonists dumped tea into the harbor. They protested "taxation without representation," which the British government imposed on the colonies.
The modern-day Tea Party movement started in 2009. It opposed Obama's economic stimulus package, which passed largely without Republican support. On April 15, 2009, many groups throughout the country held protests against Democrats' planned tax increases. The "Tea Party Express" commemorated the 9/11 attacks with protest tours August 28-September 12, 2009, and then again from October 28-November 12, 2009.
The party further solidified around opposition to the Affordable Care Act. It passed in March 2010, again without Republican support.
How the Party Came to Power
The Tea Party swept into power during the mid-term elections in 2010. Tea Party support gained 60 seats in the House of Representatives. That created a Republican majority and a Republican Speaker of the House, John Boehner. Although Republicans won an additional six seats in the Senate, they didn't capture the majority.
This election increased the Republican party's power enough to negotiate the extension of the Bush tax cuts for two more years. Despite President Obama's objections, they included cuts to those earning $200,000 or more. Tea Party members say these are primarily small business owners.
Who's Involved in the Tea Party
Some say the Tea Party was started by David H. Koch, head of the conservative "Americans for Prosperity," in coordination with another conservative group, FreedomWorks. Fox TV commentator and author Glenn Beck contributed the "9 principles and 12 values" of the Tea Party in his "9/12 Project." Fox News is also a supporter of Tea Party coverage. The Nationwide Tea Party Coalition, co-founded by former White House speechwriter and Heritage Foundation policy analyst Michael Johns, is another important proponent.