Monday, April 11, 2016

The Problem is not "A Drought of Ideas"

Over at the American Interest Walter Russell Mead looks at a failing black college in South Chicago. He blames Democrats for presiding over a corrupt and dysfunctional system, and Republicans for not coming up with alternatives. And then he blames the cognitive elite for "A Drought of Ideas."
Vain and self-aggrandizing politicians deserve a lot of the blame for not trying to tackle the problems sooner, but they are far from being the sole guilty parties. After all, politicians can’t fight for solutions that don’t yet exist. And that there is so little creative thinking about these issues is the fault of think tanks, public intellectuals and academics. It is the cognitive elite that has let the country down.
Well, yes, I suppose. But that ignores the fundamental error of our times that "think tanks, public intellectuals and academics" should be in pole position on the NASCAR Politics 500.

Would we ever worry about the cognitive elite and food, and say that the cognitive elite has let us down on food? Fortunately, think tanks, public intellectuals and academics don't have a lot to say about food production, distribution, and retailing. Otherwise I am sure it would be just as screwed up as health care.

I'd say that the fundamental problem of our times is not the failure of the cognitive elite. The fundamental problem is that something like 35-50 percent of our GDP (used here as a stand-in for the day-to-day activities of Americans) is controlled by government. And government is force. And government cannot learn. And anyone that is getting a government check, from grandma to crony capitalist, will kill rather than give it up.

OK, suppose we throw away all the government programs because government cannot learn, i.e., learn from its mistakes. What then? I think there is still a problem, as was identified by Milton Friedman. He argued that governments always tax up to the limit and spend up to the limit that the society of the time allows. Our 21st century governments have spent the last century and more ramping up spending, on the idea that government can help people. And it has steadily ramped up taxes, on the idea that the rich should pay their fair share.

Now here we are, a century later, and the programs don't really help people. Social Security discourages people from saving; Medicare encourages grandma to make an avocation out of going to the doctor; welfare encourages people to molder away in useless lives instead of getting a job; education is just a jobs program for teachers and administrators that does an OK job educating middle-class students and a dreadful job of educating lower-class students. And as for taxes! Taxeas are a monstrous tangle of subsidies, credits, set-asides and pay-offs. And the taxes on labor make the simple notion of getting a job and getting paid a nightmare for employer and employee.

So I don't think that we can say that the problem is just a drought of ideas. The problem is that the game of taxing and spending has reached its limit. There is no longer any real slack that politicians can use to say: hey kids, how about this free stuff. And the same thing applies to taxes. The obvious new source of taxes is a VAT, but that would go hardest on the middle class and we can't have that.

So nothing will change until things get so bad that people no longer think that they can hold on to their particular government check, and no longer think they can get what they want from government.

It is pretty obvious that things would have to get really bad, as in riots in the streets, before people would agree to giving up their entitlements. The Charlton Heston rule applies. I'll give you my government check when you take it from my cold, dead hands.

But I am still thinking about the bigger question. Is it possible that there could ever be a government that deliberately did not spend everything it could and taxed everything it could? And that means: could there ever be a people that said, I don't want your stinkin' entitlements and I don't want you taxing the stinkin' rich?

Sadly, I don't think that humans are capable of that.

Nevertheless, I do have an idea. My idea is this. Instead of getting entitlements from the government, people would sign up with entitlement patrons. They would pledge themselves to that patron, and the patron would promise to take care of them. But the patron would not have any coercive powers obtained from the government to force the rest of the nation to contribute to the patron and his clients. In other words, people that want it could live under a kind of neo-feudalism, where they shelter under a powerful lord and get his protection. But nobody outside the powerful lord and his patronage network would owe him and his clients a thing.

We already have this, in the the form of big corporations that offer pretty good feudal benefits and protection, and big unions that offer the same. I just want to make sure that these patronage networks cannot plunder the rest of the nation to feed their clients, and right now crony capitalism and labor law allows corporations and unions to plunder the rest of society. But not as much as government.

Obviously, employees of big government could not have any such client rights, because their rights would be supported by state coercion, government force, and that would be wrong.

Could it work? We'll see. All it would take is for government to start failing at delivering its much-loved checks. Then people would have to start finding a new way to shelter under a powerful patron.

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