Beck, the Tea Party's chief theologian, at his August rally on the National Mall Kristoffer Tripplaar/Sipa

 

 

Why Business Doesn't Trust the Tea Party

The Tea Party's small-government slogans may be appealing, but its policies could throw the U.S. economy into chaos 

By Lisa Lerer and John McCormick

Nikki Haley is almost everything the South Carolina Chamber of Commerce could want in a candidate for governor: A former small business owner (she helped run her family's luxury-clothing company in Lexington, S.C.), Haley has served on the boards of two local chambers and campaigns on the traditional business gospel of lower taxes and smaller government.
As Haley was steaming toward an easy win in the Republican primary runoff last June, the South Carolina Chamber's board—56 business leaders representing sectors ranging from banking to health care to construction—met at Clemson University to decide whether to endorse her or her general election opponent, Vincent Sheheen, a Democratic state senator. It took only 20 minutes around a U-shaped conference table for the board to make its decision: Almost 80 percent of members voted for the Democrat—even though they knew Haley was a virtual lock to become the next governor of their heavily Republican state.
The issue, as the board saw it, was Haley's extreme and inflexible approach, an ideology of confrontation that can be summed up in two words: Tea Party. Haley had allied herself with this grassroots network of self-described mad-as-hell revolutionaries, which has overrun the GOP—sending at least 14 Senate candidates, including challengers and incumbents allied with the movement, into the Nov. 2 elections—while accusing other Republicans of abandoning conservative tenets. Haley became one of Sarah Palin's "Mama Grizzlies"; the former Alaska governor and Tea Party celebrity endorsed her in May.
For business leaders who prize pragmatism and stability, it was all too much. "We worried about her ability to get along with the legislature," says Otis Rawl, chief executive officer of the South Carolina Chamber of Commerce. "We wanted to bring the debate away from the Tea Party and back to the middle." Chamber members, he says, tend to be "more realistic and moderate in their thought processes. We prefer candidates who are not extreme. If you look at the Tea Party, I think most of them would say they hate Big Business."

Austerity Appeal

To businesspeople concerned about the 9 percent increase in federal spending under President Barack Obama and the Democratic-controlled House and Senate, a Tea Party-led return to fiscal austerity has undeniable appeal. That's certainly what the leaders of this anarchic, decentralized movement are selling. Tea Party principles, Palin told Bloomberg Businessweek in a brief interview on Sept. 11 in Wasilla, Alaska, are "exactly what we need for free enterprise and business in America because these are commonsense solutions. It's just getting back to the basics, realizing that growing government—and reaching into our private sector by government—is not the solution. That has been proven throughout eternity."
There's no such thing as the Tea Party platform; in the absence of centralized leadership, Tea Party-backed candidates have come up with an array of positions based on the doctrine of less intrusive government. Most say they would preserve the Bush tax cuts, end the estate tax, and lower taxes on savings and dividends. They'd repeal the federal health-care reform law, abolish the Federal Reserve, and shrink or shutter a range of other federal agencies. They are not numerous or popular enough to enact all of these positions; less than three weeks before the midterm elections, the Cook Political Report rates Tea Party candidates in three Senate races—Nevada, Colorado, and Kentucky—as "toss-ups."
To measure the Tea Party's success by who wins on Nov. 2, however, is to miss the movement's full impact. Through a combination of brilliant politics, genuine discontent, and intense emotional appeals, the Tea Party has helped pull national Republican leaders such as John McCain to the right, and has defeated those—such as Lisa Murkowski in Alaska and Bob Bennett in Utah—who didn't move quickly enough. Its impact on the local level has been similarly dramatic. In May the historically moderate Maine Republican Party adopted a platform that included such Tea Party planks as eliminating the Federal Reserve, sealing the borders, and prohibiting stimulus funding.



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