Republicans may call themselves conservatives but the core economic philosophy of the Republican Party is Neoliberalism. Each and every serious candidate in the Iowa primary subscribes to Neoliberalism, and this is one thing that makes it hard to choose between them. But each candidate has a characteristic relationship to Neoliberalism. I will propose that there are three basic relationships; the Jester, the Preacher, and the Tool. As examples I will be looking at Ron Paul, Rick Santorum, and Mitt Romney respectively.A good definition of Neoliberalism can be found in David Harvey's A Brief History of Neoliberalism
Neoliberalism is in the first instance a theory of political economic practices that proposed that human well being can best be advanced by liberating individual entrepreneurial freedoms and skill within an institutional framework characterized by strong private property rights, free markets, and free trade. The role of the state is to create and preserve an institutional framework appropriate for such practices. The state has to guarantee, for example, the quality and integrity of money. It must also set up those military, defense, police, and legal structures and functions required to secure private property rights and to guarantee, by force if need be, the proper functioning of markets. Furthermore, if markets do not exist (in areas such as land, water, education, health care, social security, or environmental pollution) then they must be created, by state action if necessary. But beyond these tasks the state should not venture. State interventions in markets (once created) must be kept to a bare minimum because, according to the theory, the state cannot possibly possess enough information to second-guess market signals (prices) and because powerful interest groups will inevitably distort and bias state interventions (particularly in democracies) for their own benefit.
I think that this is a fair statement that none of the three (nor any of the Iowa also-rans) would disagree with. But I think that each of the three candidates has a certain relationship to these ideals that constitute the main differences between them; differences that can be characterized by the terms I have used above.
In European tradition, the Jester is a fool, but a certain kind of fool. Tradition has it that the Jester is able to say the harsh truths to the ruler that others cannot. His power isn't vested in some arbitrary ability to insult people. Rather, the Jester is a wise fool who is able to criticize people or a system in terms of their own stated ideals. He is allowed to call people hypocrites. Ron Paul is a wise fool in this sense. What makes his so aggravating to the Republican establishment and so attractive to people who really believe in Neoliberalism is that he demands that they be consistent with the libertarian underpinnings of that philosophy. The Republican Party as a whole has no intention of allowing themselves to be hamstrung by something like consistency, but it is really hard to argue with someone who says If you are really serious about playing by your own rules, this is what you would have to do and is right. Neoliberalism as a philosophy of liberty, while not against large government as such, is for narrow government, something that the Republicans have certainly not embraced since the Reagan years. Ron Paul would take the Party at its own narrow government word and leave the bankers and Afghans to their own devices. His wisdom is the wisdom of consistency; and there is where his foolishness is too, because a Party that supports the rich is not going to dismantle all of that wide and expensive support just to be consistent to some principles.
Rick Santorum, on the other hand, plays the foolish fool; the Preacher. He completely accepts Neoliberalism as the moral basis of the economic order, but this only forms the background of his Preacher act. For Santorum, the world consists of individuals and families. There really is no society, although there is a civilization based on aggregations of individuals and their values. The good society for Santorum is the Neoliberal free market, but filled with decent people. Since Neoliberalism in fact doesn't really care if people are decent or not (as we can certainly see from many things that Ron Paul has said), Santorum has to put the State in the role of coercing morality; a role that contradicts what the Neoliberal state is supposed to be. A manifestation of Santorum's incoherency is that he is both a Neoliberal and a Neoconservative at the same time. He doesn't just want to spread free markets like a good Neoliberal; he wants to spread American civilization like a good Neocon. What really makes him a Preacher is that he talks about liberty and then keeps pulling pet moral issues out of his hat for the entertainment of the crowd. He is the most successful of the morality Preachers on the circuit, having smoked Perry and Bachmann (in part by keeping his mouth shut about the economy). As a Catholic, he has embraced a sort of economic Calvinism married to Catholic personal morality, which is why as a Catholic I refer to him as a Roman Calvinist. He pays lip service to the plight of the poor (like everyone else does), but in fact he believes in the Gospel of Every Man For Himself.
And what about Romney the Tool? The gearing of the economy to meet the needs of the rich requires true flexibility, and no one is more flexible than Romney, which makes him the perfect Tool. Being a Mormon, his appeal to people who like a good Santorum Preacher act is limited. It's not that Romney doesn't belong to a strong and, in fact, perfectly conventional moral tradition. Pound for pound most Mormons probably put most Catholics to shame in regards to fidelity to their gospel. But since Romney is not a mainstream Christian, there are some things he cannot easily fake, like say, a Bush could. Still, in the world of high finance, Romney's tendency to flip flop is a plus. We are in unpredictable economic times and the last thing the Republican Establishment wants is someone that would be bound by principles (like the Jester) or by extraneous moral issues (like the Preacher). Calling the Republican nominee is going to be difficult. Ron Paul is attractive to some so-called independents; more so than either Santorum or Romney. But the Old Money is not going to trust him to do the right thing if some major government intervention is necessary on their behalf. Romney is not going to be strong with the people who want a Preacher; even Paul has been picking up evangelical support. Santorum could be strong among the Preacher vote and he is plain vanilla in his Neoliberalism to probably go along with what the rich want. But his moral positions are far too extreme for average America (he has a bit of the Jester in him too).In any case, I predict that the Republican side of the race will be around Jesters, Preachers, and Tools (Oh My!).