3rd Way Economics for Republicans?

Ross Douthat and Reihan Salam have an interesting article in the Weekly Standard that addresses Republicans domestic agenda woes and gives some ideas on what to do about it. The first half of the article examines and explains the problem, and is worth reading but more interesting to me are considering their solutions. Here is the basic overview of what they propose:

The third possibility--and the best, both for the party and the country as a whole--would be to take the "big-government conservatism" vision that George W. Bush and Karl Rove have hinted at but failed to develop, and give it coherence and sustainability. This wouldn't mean an abandonment of small-government objectives, but it would mean recognizing that these objectives--individual initiative, social mobility, economic freedom--seem to be slipping away from many less-well-off Americans, and that serving the interests of these voters means talking about economic insecurity as well as about self-reliance. It would mean recognizing that you can't have an "ownership society" in a nation where too many Americans owe far more than they own. It would mean matching the culture war rhetoric of family values with an economic policy that places the two-parent family--the institution best capable of providing cultural stability and economic security--at the heart of the GOP agenda.

I am enough of a Libertarian that the phrase 'big-government conservatism' scares me. I am also enough of a Burkean conservatism to be skeptical of bright and shiny new ideas. I am also a realist though. The electoral realities that Douthat and Salam describe are very real and people do want some increased security from their government as change accelerates. That was my view of the prescription drug plan, it was a bad idea but something was going to be done fairly soon, and given that reality it was better than some plans could have been. In addition, I follow enough economic news to know that the rising tide doesn't seem to be lifting all boats and that lower to middle income workers are facing very real challenges. Health care in particular seems to be something that has some major issues. Taken together, these factors mean I am willing to listen, but also inclined to skepticism. In the posts below, I will examine each of the ideas below and give my thoughts on them. As always, comments are appreciated.