Wednesday, November 5, 2014

Voters to Dems: You Suck!

Every society is ruled by a ruling class. That includes democratic societies. That means that, as Joseph Schumpeter wrote in Capitalism, Socialism and Democracy, democracy is not the rule of the people; democracy is the rule of the politicians.

In a democracy, all the people get to do is decide which people shall rule over them. In the US, the people get to decide whether Democrats or Republicans shall rule over them, or some combination of the two.

If we reduce this concept to the modern vernacular, the voters have a choice. They can say: "You Rock!" as they did to President Obama and the Democrats in 2008. Or they can say: "You Suck!" as they did to President Obama and the Democrats on November 4, 2014.

That is all.

This means that the people do not get to decide whether we shall have a welfare state or whether we shall recognize the Islamic State. The ruling class gets to do that.

The people had no notion, in the 19th century, of wanting free education and social insurance. They paid for education for their children, when they could, so that they wouldn't have to go down the mines. They joined labor unions and fraternal associations to share the risks of life with their brothers and sisters. It was the ruling class that came up with the idea of free education, and the ruling class that came up with the idea of government social insurance.

The ruling class said to the people: how would you like free education and free social insurance, paid for by the bosses that exploit you? The people said: Yay!

This was at least plausible in the middle-to-late 19th century, as advertised by Marx and by the Fabians. But then the science started to undermine their narrative.

In 1870, the marginal revolution invalidated the Marxian theory of surplus labor value by resolving dichotomy between "use value" and "exchange value." There was, it seemed, only "marginal value." But the Marxists went on as though nothing had happened.

In 1920, Ludwig von Mises showed that socialism could not work because the socialist planners could not compute prices. They would never know the real cost of things. Socialists argued the toss for a while and then just continued building socialism.

In 1944, Friedrich Hayek showed that the "man in Whitehall" could never approach the knowledge of the millions of consumers and producers in the market, so they could never deliver the goods as well as producers linked to consumers via the price system. Labourites in Britain and liberals in the US ignored this finding and continued building big government and big bureaucracies.

In 1944, Horkheimer and Adorno admitted that the enlightenment project had a problem. It was a project of domination over nature and other men. But liberals just ignored them and offered the people more free stuff administered by dominatory government bureaucracies.

Later, in the late 1970s, what with inflation and recession at the same time, liberals decided that the modern state was so complicated that nobody could effectively govern it. Then came Ronald Reagan, using the science listed above, and set the economy back on track. Liberals said it was all smoke and mirrors.

So here we come to 2008 and a young president who had never ventured out of the liberal ideological bubble. He and his associates in Congress pushed the pedal to the metal on big government health care, big government stimulus, and big government green energy. As though they had never heard of the science of big government.

So here we are. The big government stimulus was a failure. The big government Obamacare program has been a disaster of epic proportions. The big government green energy program has been a disaster of crony capitalism. Who could have seen it coming? Only someone who had read up on the science of big government.

And the people have said to the Democrats: "You suck!"

So what happens next?

The answer is: Nothing. Nothing can happen until the ruling class, the gentry liberals, wake up and say to themselves: "We Suck!"

And what chance is there of that? Liberals have convinced themselves that their big-government governance is the most just, evolved society that humans have ever conceived. The only thing in the way of the millennium is the bigoted racists, sexists, and homophobes that oppose them.

What about the conservatives? Why can't they offer a new way to the people?

We all like to rag on our Republican politicians, but they have a problem. If they were to propose a voyage to start slimming down big government and the welfare state that would mean reducing the amount of free stuff. You will note that whenever Republicans suggest such a thing the Democrats accuse them of pushing granny over a cliff.

So, really, nothing can be done until the gentry liberals change their minds about big government, until liberals cry "Uncle" and tell their Republican counterparts in back rooms that we need to do something about the cruel and unjust welfare state.

Most likely, nothing will happen until the government runs out of money. And maybe not even then, as Greece and Argentina seem to show.

But eventually, every ruling class that covers its eyes and refuses to see reality gets replaced. The problem is that when the ruling class gets replaced the people get wiped out by famine, war, and disease, or maybe a Dark Age. Because nothing is so blind as a ruling class that will not see.

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