Illustration by Matthew Hollister

Tea Partiers, China and Democracy’s Genius, Part 2: Noah Feldman

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Aug. 15 (Bloomberg) -- Is the Communist Party of China behind the Tea Party? Via the Xinhua news agency, the Chinese government told Americans that their days of borrowing their way out of economic troubles were over. Instead, the U.S. must cut spending on social programs and defense. There was no mention of raising taxes.

The confluence between the two perspectives, quasi-communist and quasi-libertarian, is more apparent than real. The Chinese leadership doesn’t actually want the U.S. to stop borrowing. Its holdings of U.S. treasuries are the best leverage a rising power has ever had over the world-leading hegemon it plans eventually to challenge.

The public scolding from Beijing was, more than anything, a symbolic response to Chinese microbloggers who have been criticizing their own government for over-investing in U.S. debt -- a way for the party to get ahead of Chinese public opinion without changing its strategy.

Yet it does raise a more serious question about the Tea Party: Who really is behind it?

For the last several years, liberals have charged that what appears to be a populist movement was actually generated and paid for by big business. Now, however, the Tea Party doesn’t seem to be acting in accordance with what the business community wants -- at least as reflected in the markets. After all, it was the Tea Party’s intransigence that generated the near-breakdown in bipartisanship that Standard & Poor’s cited in its decision to downgrade U.S. debt.

More broadly, in pushing the government to the brink of default, the Tea Party came close to disproving the conventional wisdom that the two-party system in the United States is entirely captive to corporate interests. If those interests are so powerful, why couldn’t they make their political arm -- the U.S. Congress - act quickly and in concert to raise the debt ceiling? If cuts are needed -- or taxes must be raised -- to reduce the deficit and improve the nation’s credit, why couldn’t corporate America push Congress to reach consensus sooner, or at all?

One possibility is that corporate interests do greatly shape U.S. politics, but that the tool they mostly use -- influencing electoral democracy through campaign contributions - - is a blunt instrument rather than a scalpel.

According to this view, many in the business community were actually very worried about the nearly uncontrollable growth of the deficit during the George W. Bush presidency. Even with Republican control over the veto pen (and, for some time, Congress as well), discretionary spending rose to unprecedented levels.

This fact of Republican perfidy to the cause of the balanced budget was so striking that it led traditional libertarians such as David Stockman to the apostasy of supporting tax hikes.

Responding to this situation in which even Republicans would neither cut spending nor raise taxes, these business interests helped finance the Tea Party. They hoped, according to this theory, that a radical movement demanding cuts would put pressure on mainstream Republican and Democratic politicians to rein in spending.

Once the Tea Party tasted success, however, the members of Congress associated with it could not be controlled as precisely as its initial corporate donors would have liked. These representatives pushed too hard, endangering the very sense of bipartisan stability on which corporate America generally relies. Of course, in the end, they did act reasonably (if not responsibly) in providing enough Republican votes to raise the debt ceiling.

Another theory is based on the fact that genuine populism does recur in American life. This makes the structure of bipartisan consensus in hock to corporate interests far less stable than its critics believe. And when a movement does catch political fire, it isn’t responsible in any direct way to a particular corporate or even class interest.

Many observers point out that the Tea Party movement has trouble converging on any set of ideas except for reducing deficits without raising taxes. Yet polls suggest that many Tea Party affiliates also balk at the idea of major cuts to Social Security and Medicare -- not to mention deep reductions in the defense budget. This isn’t a policy prescription, but an impulse wrapped in a package of denial.

Because it comes from below and not from professional politicians, populism is simply not responsible to all the demands of institutional rationality. It expresses strong public feelings of dismay and frustration. (Just ask the Chinese microbloggers who are angry that their economy is growing faster than the standard of living is rising.)

Politicians in a democracy are entrepreneurs who cater to trends in public opinion so long as those trends can bring in votes. The Tea Party congress members therefore didn’t initially feel the need to act according to a coherent policy plan. As I argued in my previous column, however, they did eventually come around -- because their interests began to match those of other congressional stakeholders.

There is an important lesson here about how popular movements can or cannot break the stranglehold of the two-party system. In the U.S., a genuinely popular movement can move one of the major parties -- and even the system as a whole -- to an appreciable degree. It is, however, limited by the tendency of such movements to become part of the bipartisan system rather than challenging it from outside.

Just a year ago, some imagined that the Tea Party could become an independent, third-party style movement. Instead it became a faction of the Republican Party. This was both a wise move -- third parties have never really succeeded in the U.S. -- and also the first step in the undoing of the Tea Party’s radicalism.

Critics of the two-party system take note: You can have an impact. Corporate interests don’t always prevail. But the results won’t always be the ones you like. Sometimes, they can be downright scary.

(Noah Feldman, a law professor at Harvard University, is a Bloomberg View columnist. The opinions expressed are his own.)

To contact the writer of this column: Noah Feldman in Cambridge, Massachusetts, at

To contact the editor responsible for this column: Tobin Harshaw at