A Moderate Republican Approach That Actually Delivers Results

I write a lot about the future of various flavors of conservatism. Today is a look at fixing the failures of political conservatism and Republican governance at the state and local level.

I’m a lifelong Republican who spent five years working at a conservative think tank. But I’ll bet you won’t be surprised to hear I have a lot of complaints about the failures of the Republican party in recent years.

I can actually name a lot of accomplished Republican leaders who did amazing things. I’m from Indiana. Right here in our state, Republican industrialist J. Irwin Miller’s civic leadership made his home town of Columbus the only Rust Belt city that never rusted. In 1967, Esquire magazine put him on its cover and wanted to draft him to run for President. A mayor of Indianapolis, Republican Richard Luger pushed through a far sighted city-county merger. Later, as a US Senator, he was a highly respected foreign policy voice that played a key role in securing post-Soviet nuclear weapons and materials. Republican mayor Steve Goldsmith was a nationally renowned innovator in government privatization, and went on to a variety of roles including deputy mayor of New York City and professor at the Harvard Kennedy School. Mitch Daniels drew national kudos for reinventing state government as governor and then freezing tuition as president of Purdue University.

There’s just one problem: most positive examples of Republican accomplishment here I can cite are from a long time ago. Virtually all of them happened over two decades ago back in the 20th century.

In the 21st century, in today’s world, Republicans have largely been a failure at governing.

At the federal level, Congressional Republicans can’t do much besides pass tax cuts for the rich and appoint Federalist Society judges. The George W. Bush administration was a debacle. Trump actually had more accomplishments than people give him credit for, but by and large he was unable to govern. Undoubtedly the election of Trump itself revealed a lot of rot in the American body politic generally, and that’s especially true of the Republican party.

Republicans haven’t exactly set the world on fire at the state level either. I wrote a 7,000 word article for American Affairs detailing Republican failure in Indiana. Republicans have controlled the governorship since 2005 and the entire state government for over a decade. The results were declining incomes, anemic growth, a low wage economy, very poor educational attainment, a decline in the number of people attending college, and other indicators of stagnation. I actually don’t blame the state’s GOP for creating these problems, but they certainly haven’t been able to fix them. Similar stories could be told in many other red states.

Most examples of successful Republican state level governance are in Sunbelt places that were probably going to boom anyway. In fact, the growth wave in some of these places started when they were still part of the Democratic “Solid South.”

But there actually are some examples of successful Republican governance in America. This even includes people governing as the dreaded “moderate Republican.” If “respectable” Republicans want to win the favor of their own voters, they need to figure out how to channel these examples and start delivering real results.

I will share one contemporary case study whose general contours, if not the specifics, are applicable to a wide range of state and local governments. That is the story of Carmel, Indiana and its retiring seven term Republican mayor Jim Brainard. Brainard has simply been the most successful, consequential, and influential elected official in the state of Indiana in the last 25 years.

The Brainard strategy at its core is about a laser-like focus on improving community quality in the areas within city government’s span of control. This included: major infrastructure investments and improvements, improving the quality and attractiveness of the public realm, creating community amenities, and delivering high quality public services. Unlike most Republicans, he was willing to borrow and invest large sums of money to make it happen. And unlike most other politicians, he didn’t let other matters or endless conversation distract him from building and accomplishing things in the areas where he wanted to focus.

I will give a number of examples of what was accomplished, and compare this strategy to both the governance strategy the Republican party at the state level in Indiana has pursued and the principles I have previously suggested for red state governance.

Jim Brainard was elected mayor of Carmel, an upscale business suburb of Indianapolis, in 1995. He immediately set out charting a more ambitious path for his city, which over his seven terms has resulted in a profound transformation of Carmel.

Infrastructure

Among his biggest accomplishments is investing hundreds of millions of local dollars into infrastructure such as streets. We have a lot of debates in America about investing in infrastructure, but Carmel actually did it.

Carmel is most famous for its modern roundabouts. While these have become a national trend, Carmel played a key role in popularizing them and has far more of them than any other city in the country - over 140 of them.

This has produced an astonishing result: stoplights have been all but eliminated in this city of 100,000 people, and there are very few four way stops as well outside of purely residential streets. Apart from a handful of times and places, such as pickup and drop off times near the high school, there’s almost no traffic in the city. You can often zip to where you want to go without ever stopping.

Roundabout designs were even used to build interchanges on current and former state highways in the city, which are now very nice parkway type roads. Here’s an example:

Many miles of streets were also converted from rural type county roads to boulevards with very nice landscaping and extra-wide 8’ paths on both sides of the street. You can essentially bike anywhere in the city on this very nice path network.

I won’t go into details on this one, but Carmel also fought a big battle with the Indianapolis water utility to take over water lines in the city. It then invested in capacity such that during periods without much rain, Carmel is basically the only city in the region that doesn’t have to impose water use restrictions. It is also the only city in the area that pre-softens the region’s very hard water so that homeowners don’t need to buy a water softener. And its rates are lower than the city’s

Parks and Playgrounds

During Brainard’s tenure, Carmel went from fewer than 100 acres of parks to over 1000, and continues to add more. They’ve invested to make them very nice, including some of the best playgrounds in the country. This one in Carmel’s Central Park is my son’s favorite and is better than any playgrounds we visited in New York City. It includes a number of handicapped accessibility features, as we as special features for autistic children.

Photo Credit: Landscape Structures (the equipment vendor)

Here’s a plaza, Midtown Plaza, the city built along the Monon Trail, the city’s main biking trail.

The Monon Trail itself is very well-patronized.

From a Carmel Monthly retrospective on the Monon Trail

New Urbanism

Carmel was historically a purely sprawling suburb, with only a postage stamp sized historic area dating to the 19th century, and some office buildings lining US 31 through the city. There was not even much of downtown to speak of.

While retaining the city’s fundamental single family home character, the city undertook major redevelopment of its central area into higher density, mixed use, urban style development. This included turning the old town area into a real Main St. type district called the Arts and Design District.

Midtown and City Center are two other such new urbanist districts. There are also zoning overlays on some corridors to require multistory mixed use buildings fronting the street. The city often operates as a quasi-master developer, acquiring land and paying for infrastructure such as parking garages as an incentives for a commercial developer to create a project in line with their vision. It’s been effective, though my critique would be that it can come across as inorganic. Some of these are clearly developments, not genuine urban districts.

Arts and Culture

Brainard’s vision is for Carmel to be a complete city in its own right, a node within the Indianapolis region but one that is not dependent on the city of Indianapolis for critical amenities. He doesn’t really think of Carmel as a suburb. So he has focused on building up the arts. The centerpiece of this is a $175 million acoustically perfect concert hall called the Palladium at City Center.

There are also multiple other theater buildings, including the home of the Booth Tarkington Civic Theater, the oldest continuously operating community theater in the country, which they were able to attract after the Indianapolis Museum of Art evicted the company. The city has also installed a large quantity of public art.

This has only been variable successful for them. At the end of the day, Carmel is still suburbia, with a suburban artistic sensibility, and the art reflects that. Few performances at the Palladium merit a hall of that quality, and it is likely to be a financial challenge to renovate when that bill comes due. But undoubtedly Carmel has created real culture, and done some interesting things such as its partnership with Michael Feinstein’s Great American Songbook foundation.

Other Public Services and Amenities

The other public amenity of note is public restrooms, which are all too rare in America. There are public restrooms in several locations in the city, as well as in many of the parks. They are very nice ones too.

Since it’s the Christmas season, I’ll also mention their German-style Christmas Market and ice rink, which has been rated as the best in the country. It’s smaller but nicer than even Bryant Park’s in New York City.

Public service delivery is likewise good. The school district is separate from the city. It’s highly regarded regionally and well-resourced, but not nationally elite. They made a decision long ago to stay with only one high school, with the result that Carmel High School is the largest in the state. This means lots of sports championships and programs, but a very competitive environment to access them. The library is also a separate governmental entity that just finished a fantastic renovation and expansion of their first rate building.

It’s hard to know if Carmel’s police are any good, since crime is so low generally in the Indy suburbs. Similar, the number of structure fires in America is way down. I can’t evaluate those services. I do know that they maintain their parks well. I was up there a few weeks ago and saw a parks crew doing some maintenance and setup at Midtown Plaza. I asked them how often they were there. They said they service the plaza daily, sometimes multiple times per day. The city also does a good job at snowplowing, which all too many Indiana towns don’t.

Add it all together, and, while some of the arts and real estate plays are arguably beyond the traditional scope of local government, most of what he did was just focusing on doing the basics very well: streets, water and sewer, parks and playgrounds and quality public service delivery.

Brainard took over what was basically a generic sprawlburg with a decaying central area that was, candidly, a dump, and turned into a truly first class city.

A lot of what Carmel did under Brainard has been broadly done in other similar upscale business suburbs. But he did it to a much greater extent and sometimes at a higher quality level than elsewhere. Nobody else all but eliminated stoplights with roundabouts, for example. Not many suburbs have built $175 million concert halls. He built the best Christmas market I’ve ever been to. He also started with less (virtually no historic town center, for example), and in a state that is typically allergic to nice stuff.

Carmel has also piled up awards and press. It has been rated the best city in the country by surveys like CNN Money. USA Today said it has the best Christmas market in the country. The Economist just cited Carmel as a place that can teach America about urbanism. The New York Times wrote about its roundabouts (and has featured the city multiple times).

The Carmel GOP model of governance is to focus on relentlessly improving community quality across a range of dimensions from infrastructure to the arts. And they have actually delivered on it.

Willingness to Invest Big

One key difference distinguishing Carmel from the average Republican controlled government is a willingness to spend big. The city’s spending, much of it financed with debt, has been the greatest source of criticism and controversy during Brainard’s tenure.

Carmel has racked up about $1.4 billion in debt, which is considerable. That’s around $14,000 per capita. That’s not nothing. But to put it in perspective, the city of Chicago has per capita debt of $43,000. What’s more, both Cook County, Illinois and the state of Illinois also have huge liabilities, whereas Carmel residents are on the hook for very little county or state debt. Across all levels of government, Chicago’s per capita debt and unfunded liabilities are over $135,000.

Given Carmel’s high income residents and large business base, these debt levels are very affordable. Property taxes in Indiana are also constitutionally capped at 1% of the value for owner occupied homes, so the exposure of the taxpayer is limited, although a recession or higher interest rates could potentially create fiscal challenges for city government. Also, Carmel’s debt is includes utility debt, which is financed with revenue bonds. And it includes developer subsides that city taxpayers are not on the hook for, and other bonds backed by Tax Increment Financing districts that are repaid through commercial taxes only. Their use of debt also has a seldom-discussed benefit. Because the debt service payments are built into the city’s budget, as general obligation debt is paid off, it can be re-borrowed without raising taxes, creating a perpetual source of future capital funding. They are already taking advantage of this.

Nevertheless, they have chosen to spend a lot of money to build things like high quality streets, roundabouts, and excellent parks. There’s no two ways about that. They didn’t have to do it. It was a choice. They could have been content with average, done the minimum, or adopted a policy of fiscal austerity. Lots of other Republican run places did. But Carmel didn’t. They chose to build a high quality community instead.

The typical approach of state and local Republicans has been: don’t spend anything, don’t do anything. Brainard and Carmel’s approach is: let’s invest in making our community the kind of place we want it to be, and make sure that we are actually getting tangible results for the money spent.

Focused on Building

In 2020, venture capitalist Marc Andreesen attracted a lot of attention by saying, “It’s Time to Build.” Jim Brainard has lived that motto for over 25 years. He’s focused on building and accomplishing things. One way he did that was by focusing on things cities can actually control: streets, parks, and the like. He did not try to solve for world peace or other such problems.

This is where I think the traditional Indiana political analysis of Brainard is wrong. Many view him as a liberal Republican or RINO - a “Republican In Name Only.” In my view, Brainard is actually a “RINO in name only.” That is, he’s the very rare Republican who talks more liberal than he governs.

One example is climate change. Brainard directly states that it is occurring, and that we need to do something about it. In fact, he was a member of a federal climate task force created by President Obama. And yet, most of what he’s done related to climate change has been things he would have pushed for anyway if there were no climate crisis because they are good for quality of life. Bicycling, roundabouts, mixed-used walkable districts - all of these are touted as part of Carmel’s climate plan, but are really much more about his community quality agenda. Notably, he has not done things like try to eliminate cars in certain areas of the city, or impose significant green design and energy mandates on buildings. Or to eliminate single family only zoning in the city.

It’s similar for diversity type issues. Brainard makes a point of welcoming everybody to the city. He celebrates that the city is becoming more diverse. Its black population has more than tripled since 2000. Last I checked, around 14% of households there spoke a language other than English at home. The Indianapolis Chinese Community Center is based in Carmel. The Mormon Temple is in Carmel. There’s a significant gay population in Carmel. But Brainard does not shun conservatives or try to wade intro controversies around social issues unless he has to.

In particular, Brainard is clearly not woke. When he tries to wade into those waters, it comes across very awkwardly. For example, he briefly threatened to sue the city of Minneapolis for his police overtime costs after the George Floyd Killing. Woke type complaints about structural racism have been on the rise in Carmel. Brainard has basically held them at bay in a manner similar to his approach with climate change. Basically, Brainard is a moderate, one who adheres to traditional liberal values of pluralism and everybody welcome, but without the intersectionality matrix that’s been imposed in most urban centers.

Brainard has thus found a way to stay compliant with left oriented, upper middle class, elite consensus social values, while not getting distracted or consumed by them like most central cities has. That’s not to say his moderation is fake. I think he’s a genuine moderate Republican type. It’s just that he’s putting most of his effort into areas where he can actually move the needle, namely delivering public goods and services in his city. That’s something we can learn from.

The Carmel GOP vs. the Indiana GOP Model

It’s worth comparing the Carmel model and results versus those of the state. Indiana’s state GOP has taken a traditional “good business climate” approach to governing. They’ve focused on fiscal austerity, tax cuts, regulation parebacks, aggressive subsidization of business, school choice, and building roads (with a focus on quantity over quality). The results have been largely poor, as I noted. The state has become a destination for low wage employers, and developed a poorly education, low skilled workforce. Many of the state’s communities are literally falling apart, and social and health problems abound.

The Carmel model is also built on basic business friendliness and low taxes - despite the spending, it’s taxes remain very low - but with a much greater emphasis on community quality, public education, other public services, and amenities. Its results? Carmel has been growing. It’s a highly educated city. I need to update my database with the latest data releases, but as of 2019, 75% of Carmel adults had a college degree. It had the 46th highest median household income of any municipality in the country with over 65,000 people, at $113,700 (a bit higher than similar Irvine, California). It has millions of square feet of office space and lots of high paying employment. It typically doesn’t have to give out a lot of subsidies to get businesses to move there.

However, this isn’t really a fair comparison. Taking what is arguably the state’s nicest and most upscale community and comparing it to the state as a whole isn’t fair. A better comparison is versus peers.

In my American Affairs article, I note that while Indiana has mostly failed to turn around decline, the rest of the 23 state region I call the “Old North” hasn’t figured it out either. Red or blue, urban or rural they are all basically stagnant, except North Dakota with its oil boom. Indiana is more or less average vs. peers. Indiana’s GOP hasn’t done unusually poorly.

I would argue that Carmel is also more or less average vs. peers. There are areas where it’s ahead, but also areas where it has underperformed. Carmel has 6.8 million square feet of office space. But that’s actually less office space than a number of peer cities, and there are no Fortune 500 HQs. Dublin, Ohio near Columbus is smaller than Carmel but has 8.1 million square feet, for example. Peer cities to Carmel in bigger metros typically have much larger office and corporate bases. In the Detroit area, Southfield has 16.9 million square feet of office space and Troy 13 million. Both are smaller in population than Carmel and about equal in geographic size. Carmel also hasn’t been especially successful in attracting high end retail relative to its income levels. The bulk of the region’s high end retail remains firmly planted in it historic north side Indianapolis location.

Carmel GOP vs. My Red State Principles

Which brings me to the comparison between Brainard’s Carmel strategy and my principles for red state governance. In my American Affairs article, I argue that, especially in the Old North, the ability of governments to materially alter the trend line of their economy is very limited. For example, Illinois pressed the blue pedal as hard as Indiana pressed the red one, but it has had a similar underperformance. For good or ill, the market is the overwhelming driver of economic success. The truth is, whether or not companies locate in your community is something you largely can’t control in most cases.

So in light of that, how should states and localities govern?

I argue for a citizen-centric approach, focused on serving the needs of a city or state’s existing population base. This should be done in three ways: citizen well-being, quality of place, and advancing the cultural agenda of the majority. In this approach, whether or not a policy generates economic prosperity - and history suggests that’s speculative - it still makes life better for the people who live there.

This is exactly what Brainard has done. He’s built a first class city. He’s invested in the services he controls that advance citizen well-being. Other government entities there like the schools and library district have done the same. While my article was written predicated on the cultural conservatism of the average Hoosier voter, Brainard’s basically moderate social outlook and general approach are very aligned with the resident based of his city, which is heavily “chamber of commerce” or “country club” types. So his agenda is authentic to his community. He successfully made Carmel a great city for its people.

If the state of Indiana and the rest of its communities had adopted a Carmel like strategy, who knows if it would have worked to bring high wage jobs to the state. But it would have made the state an amazing place to live. And probably addressed at least some chronic problems, too.

Carmel is the road not taken for the Indiana GOP.

There’s a question of whether the state and other communities could have adopted this approach. After all, another way to describe the Brainard approach is: the nicest stuff for the people with the most money.

In my view, replicating the basic model, stripped of some of its luxury flourishes, is very possible in a wide range of communities. Eliminate the Palladium and projects of the nature. Just look at basic public goods and services like streets, parks, libraries, etc., I believe pretty much every suburb in metro Indianapolis could afford to build the same as what Carmel has built. They might not choose to do it (more on that later) and might have external constraints due to state tax caps and such, but the people who lived there could afford to live just as nicely without being overly tax burdened.

I will do a quick back of the envelope calculation. Eliminate utility debt, debt for arts amenities like the Palladium and TIF debt (which in Indiana is paid for by commercial property taxes, not residents). Let’s eyeball that at about half of debt, leaving $7,000 per capita. At 5% (higher than current rates) on 20 year municipal bonds, that’s a payment of less than $50/month per person (obviously more per household). But keep in mind, commercial taxes would cover a good chunk of that too.

While some communities would certainly struggle to carry that type of debt load, it’s well within reach for any middle class community. Every Indianapolis suburb has the financial capacity, if not the legal capacity or political will, to turn themselves into a slightly more basic version of Carmel. As do many other communities throughout the state.

The state has even more fiscal capacity. While he was governor, Mike Pence pushed through a very minor tax cut that saved $500/million per year. In the first decade after that took effect, this cut represents $5 billion - in cash, not debt - that could have been used to, for example, repair large swaths of the state’s crumbling local streets. Just this summer, the state refunded $1 billion to taxpayers. In a state replete with communities that are falling apart, a crisis in special education, huge drug problems, etc., the state decided to send out $250 checks instead of doing anything about it.

Indiana’s GOP has made conscious choices for austerity. Rather than making the state great, they decided to make it cheap. They didn’t have to. They wanted to.

By the way, where did Mike Pence choose to live when he moved back to Indiana after leaving the vice presidency? Carmel! He doesn’t even want his own product.

Giving People What They Want

The same basic Carmel formula, tailored to local income levels and conditions, is a pretty good one for states and local governments. Focus on your current citizens through creating better and nicer places, elevating the well-being of your people, and being responsive to their cultural aspirations (which in most red state communities will be much more conservative than Carmel).

States obviously have different areas of responsibility than cities, and some of them are more nebulous and harder to improve on. It’s easy to build nice playgrounds. It’s hard to reduce ex-offender recidivism. But this focus on relentlessly improving community quality and the quality of public services with the tools that are within your control is still applicable.

Republicans could do this if they wanted. In some ways they are better positioned to do so than Democrats because red states usually aren’t controlled by public sector unions that cripple the ability of government to do things in a cost effective manner. They just aren’t doing it.

It’s easy to blame Republican leaders, but the citizens of these states have to take some responsibility too. The average person in Indiana subscribes to a sort of Tea Party style folk libertarianism. They are deeply hostile to government spending and taxes. Given a choice between a nicer community and a very slightly lower tax bill, they’ll choose the low taxes almost every time. Given them a choice between great parks and playgrounds, and getting a $250 check from the state, most of them will take the check.

Every single leader in Indiana who has tried to actually improve his community has received immense and intense pushback. Sometimes this is from a minority, but not infrequently Tea Party type politicians win elections on the backs of this kind of criticism. This is hardly limited to Indiana.

I said politicians need to advance the cultural priorities of their voters. Unfortunately, austerity happens to be one of the cultural priorities of the GOP voter, in Indiana and elsewhere. That’s fine, but they need to accept that they are going to live in a run down, low end community with lousy services. Of course, they don’t accept that, which is why they then glom on to the next populist grifter who’ll pander to their resentments and promise to restore prosperity (on somebody else’s nickel).

The people of these places have legitimate complaints. But they also have to accept their fair share of the responsible for the condition they and their community are in.

Yet, it’s the job of leaders to lead. Carmel’s Brainard faced enormous opposition, especially early on. At times he faced a hostile city council that could stymie his moves. There were huge fractures and disputes in the community. But he was relentless - and managed to keep winning elections too. It took 15-20 years before he finally built overwhelming community buy-in to his vision. Now, nobody can imaging going back to the old way of doing business.

Believe it or not, we can actually live in high quality places with well-functioning governments again. With blue states and cities unable to govern, there’s all the opportunity in the world for Republicans to step up and prove that they can do it. They need to find the models that are working - Carmel’s isn’t the only one - and start replicating them courageously. That will require new leadership, and a willingness on the part of the people to follow along. Getting this is a long shot, frankly. But Jim Brainard and Carmel show that there are people willing to take it on and places where it is possible.