'George W. Hoover?'

Neoconservative William Kristol (the one who brought us Sarah Palin) writes this in his New York Times column today.

Last week, assembled at Miami’s InterContinental Hotel for a meeting of the Republican Governors Association, the governors seemed cheerful. . . .

But there was an almost-never-mentioned elephant in the Versailles Ballroom (yes, that’s its name) full of Republicans: George W. Bush. For the hard fact is this: The worst financial crisis in almost 80 years has happened on his watch. The Bush administration will leave behind probably the most severe recession in at least a quarter-century. Fairly or unfairly, this will be viewed as George Bush’s economic meltdown.

If Republicans and conservatives don’t come to grips with what’s happened — and can’t develop an economic agenda moving forward that seems to incorporate lessons learned from what’s happened — then they could be back, politically, in 1933.

From 1933 to 1980, Republicans repeatedly failed to convince the country they were no longer the party of Herbert Hoover — the party, as it was perceived, of economic incompetence, austerity and recession (if not depression). . . .

I don’t pretend to know just what has to be done. But I suspect that free-marketers need to be less doctrinaire and less simple-mindedly utility-maximizing, and that they should depend less on abstract econometric models. I think they’ll have to take much more seriously the task of thinking through what are the right rules of the road for both the private and public sectors. They’ll have to figure out what institutional barriers and what monetary, fiscal and legal guardrails are needed for the accountability, transparency and responsibility that allow free markets to work.

And I don’t see why conservatives ought to defend a system that permits securitizing mortgages (or car loans) in a way that seems to make the lenders almost unaccountable for the risk while spreading it, toxically, everywhere else. I don’t see why a commitment to free markets requires permitting banks or bank-like institutions to leverage their assets at 30 to 1. There’s nothing conservative about letting free markets degenerate into something close to Karl Marx’s vision of an atomizing, irresponsible and self-devouring capitalism.

If conservatives do some difficult re-thinking in the field of political economy, they can come back. If they don’t — well, there were a lot of admirable conservative thinkers and writers, professors and novelists, from 1933 to 1980. But conservatives didn’t govern.