After Obama, A New Birth of Freedom

President Obama famously declared that he wanted to "fundamentally transform" America.  That is, of course, the eternal revolutionary's creed.  But a famous football coach said that when you go to pass the ball, one of three things could happen, and two of them are bad.

In other words, when you go for the long ball, as when you choose a decisive battle, you are opting for a decisive win or a decisive loss.  I am starting to think that President Obama is heading for a decisive loss in November, one that will fundamentally transform US politics and complete the Reagan revolution.

For I believe that the fundamental fact of US politics since 1989 is that liberals have refused to concede the Reagan victory.  They have refused to concede its economic aspect, that low tax rates and sound money and limited regulation are the foundation of a healthy economy.  And they have refused to admit the social aspect, that the social safety net should not be an iron rice bowl of universal big government programs, but a flexible web of associations and charities anchored on the assurance of government help in an emergency.

In my view our liberal friends are about to receive a terrible blow, right in the solar plexus: a Republican president with decent majorities in both houses of Congress.  The last time this happened was in 1928, for the great Reagan era featured a Republican Senate for the first six years and a Democratic House throughout.

The challenge for the future is to establish a new national myth, a convincing "story so far" about what happened in the big-government era, why it was wrong, and what we must to do to restore America to its greatness.

The first thing to establish is what went wrong.  The answer is fairly simple.  We abandoned the idea of the strong society and replaced it with idea of the strong state.  Society is the net effect of humans cooperating as social animals in their millions of social relations and combinations.  When that is replaced by rigid, mechanical government bureaucracy, something dies.  That something is the social instinct to share and reciprocate.  Big government reduces everything to rigid rule and compulsion.

The second thing to establish is what has worked.  We have just come off two centuries in which daily income went from $1-3 per person per day to $120 per person per day.  And violent death in the West since about 1300 CE has gone from about 50 deaths per year per 100,000 population to about 5 deaths per year.  Think of that: prosperity has increased by two orders of magnitude and violence has decreased by one order of magnitude.  How great is that?

There are two great competing narratives about why this happened.  One narrative is the Invisible Hand  argument of Adam Smith, that people naturally serve others in order to serve themselves.  The more that people stop fighting for plunder and start working to serve other people, the more prosperity you will get and the less suffering.  The other is the Exploitation argument of the international Left, that social relations are blighted by exploitation and oppression unless corrected by idealistic activists.  Things get better only if good people take a committed stand against injustice and violence.

As a conservative, I'm partial to the Panglossian Invisible Hand world view.  But I also accept the need for the Exploitation world view.  We are talking about the fight against slavery, against racism, and ruthless industrial discipline.

It is important, I think, to recognize that the real and authentic experience of different people will prompt them to take different views of the two great arguments.  If you are a competent middle-class person, you will likely think that the world is a friendly place and that hard work will lead to a life of reasonable prosperity and happiness.  But if you are a recent immigrant to the city you will likely experience the world as a dangerous and oppressive place.  You will feel that you are barely hanging on against brutal economic forces and see the need to be ready to fight against the powerful at any time; you will probably find yourself a powerful patron to fight at your side.

If you believe that the Invisible Hand argument is central, then you will think that the government does not need to be very big or very powerful.  If you believe that the Exploitation argument is central, then you will think that you need a powerful government to fight on your side and end the history of exploitation and oppression.

This brings us to the need to get it right.  The astonishing increase in prosperity in the lands that have practiced the Invisible Hand doctrine is surely an argument that the Invisible Hand works.  The end of slavery, of racism, and of grueling manual labor surely means that the application of the Exploitation doctrine has worked and that the remaining oppressions--such as gay marriage--are much less urgent than the old evils of slavery and satanic mills.  Yes: for some people this is still a cruel and heartless world.  But overall, things have got remarkably better.  The takeaway?  We need much less social compulsion in our society.  Since government is the principal agent of compulsion, that means that we need much less government.

Let's come right out and say it.  It's time to say: "no more victims!"  The notion of humans as social animals means that we are all social beings and we should all be active in societal interaction and cooperation--even the poor who are so often cast in the role of helpless victims in our modern political dramas.  There is a lot of modern commentary--from writers like James Tooley and Sudhir Alladi Venkatesh--that shows the urban underclass poor to be energetic and resourceful.  They scrape up the money to send their kids to private school in cities like Hyderabad and they figure out how to run off-the-books businesses.  They even figure out how to manage and save money in the chaotic world of the urban slum.  Let's stop treating them like helpless victims!

That leads us to the idea that everyone can and should contribute.  It has been well said by Mark Steyn that the problem with the welfare state is that it makes everyone into teenagers.  We get to decide what cellphone to use and what car to drive, but every other decision is made for us.  That's the difference between teenagers and adults: adults have responsibilities.  The modern welfare state attenuates the responsibilities of citizens and collapses citizen responsibilities into government programs and bureaucracies; it turns adults into teenagers.  But Arthur C. Brooks in The Road to Freedom argues that people need two things to be happy.  They need to work at something they love and achieve earned success.  And they need to give.  The more they give, the happier they will be and the less envious they will be.

You can see what this means.  It means that if individuals are to be happy they must stop being teenagers and become adults, with responsible work and active engagement in their community where they give time and money to others.

It is obvious that the only way this can happen is if big bureaucracy, corporate and governmental, takes a big dive.  It's hard to feel your work is meaningful when you work in a big bureaucracy.  And it's hard to give to the community if the government has scarfed up all the social tasks of helping others and relieving the poor.

But golly.  Lookee here.  We've just finished up two centuries in which the low-compulsion Invisible Hand society has performed wonders in lifting everyone up from poverty.  And we've already cleared away the great evils of slavery and racial discrimination.

So the stage is set for a new era of freedom and cooperation, a culture of involvement, from the foundation president to the neighborhood mama, with a lot less governmental coercion.

But there is someone standing in the courthouse door, bellowing: Progressivism today, Progressivism tomorrow, Progressivism forever! It is your neighborhood liberal. America cannot move forward until liberals step back, stop insisting that the US is an evil, oppressive nation, and relax their death-grip on the levers of political and cultural power.

That is why the election of Barack Obama in 2008 was a good thing, and the defeat of President Obama in 2012 will be just as beneficial.  The election of Obama in 2008 proved that the US had got beyond slavery and racism.  The rejection of Obama in 2012 will prove that the US utterly rejects the canard that the US remains an oppressive nation that needs gigantic government to force it into the ways of virtue.

The election and the rejection of Obama will clear the public square of all the dirt and dross of a century of big government; it will demoralize the liberal ruling class that has spent the last generation refusing to learn the lesson of Reagan.  It will create the space for a new birth of freedom and cooperation.

Is this a great country or what?

Broken Models, Bad Faith

The upshot of the Great Recession, according to Robert Samuelson, is that the economic models are broken.  In the case of the US, the broken model is "consumer-led growth."

From the early 1980s until the mid-2000s, what propelled the economy was rising wealth - stocks, bonds, real estate - that encouraged households to spend and borrow more. Feeling richer, people traded up for better cars, homes and vacations. Everyone could afford or aspire to "luxury." Businesses responded by investing in more malls, restaurants, hotels, factories and start-ups.

Hmm.  I'd say that the story of the last 30 years has been two duelling models: the supply-side model of sound money and low marginal tax rates, and the demand-side Keynesian model of cheap money and big government stimulus.



Then there's the European Euro model, writes Samuelson.  It rested on two assumptions.

First, the success of the euro - the single currency used by 17 countries - would continue. The euro had delivered low interest rates in the countries that used it, causing housing and consumption booms in Ireland, Greece, Spain and elsewhere. These in turn fed the demand for exports from Germany and other countries. Everyone benefited.



Second, slow but steady economic growth sufficed to support generous welfare states. Tax revenue kept budget deficits at manageable levels.

So much for that model.



But I think that Samuelson is missing the point.  The economic models he is talking about are not really attempts to understand the economic system.  They are attempts to game the system.



The Keynesian demand-side model originated as an attempt to cut short the process of the liquidation of the malinvestments of the 1920s boom.  A little bit of inflation and a little bit of debt from excess government spending would be enough to re-prime the economic system.  It didn't work in the 1930s, probably because in addition to the inflationism, governments were anti-business, actively wrecking the economy.



The Euro model was an attempt by the European ruling class to nudge their individual governments into one central, sensible economic policy without going through the trouble of educating each electorate and reforming each big-government patronage system.  It didn't work.



It is only the supply-side model that doesn't try to game the system.  That is why is was such a success in 1981.  It assumes that the economy is a self-regulating system that will deliver growth, employment, and wealth if it is left to itself.



But people do not go into politics to leave things alone.  So they bend economics to their political will.  They get economists to gin up complicated ways of exploiting the economic system for political ends.



So we get the subsidy for mortgage credit in the US, to which the politicians added a twist, forcing bankers to lend to people without proper credit or equity.  We get the single currency in Europe, which would work fine if nobody cheated.



Half a century ago and more, Ludwig von Mises taught that cheap money always led to the crack-up boom.  F.A. Hayek taught that the government couldn't run the economy because it couldn't have enough information.  It was a "Fatal Conceit" to think that it could.



But liberals refused to listen.  Now they have wrecked the western welfare state economic model and it serves them right.



Unfortunately it is not liberals that will suffer most.  The people that will suffer most are the people that have built their lives on welfare-state benefits.  Because those benefits are going down in the future.  In some places they will go down a little; in other places they will go down a lot.



What we need is reform.  We need reform that will change the welfare state model to a welfare society model.  Instead of being passive recipients of welfare state benefits, counting only what they receive, citizens should become active participants in the creation of social capital, counting what they give.



State welfare is not social welfare.  State welfare is the government handout taken from taxpayers.  Social welfare is the freely given and freely received action of humans acting in social cooperation and assistance.



Is America ready for a social welfare society?

Liberals and Inequality

President Obama says that the rich should pay a little more in taxes to make it fair.  But liberal pundits are more direct.  They say that "inequality" is responsible for a number of social evils, and it requires a policy response.  Writes Patrick Brennan in NRO:

Nobel laureates, from our president to Paul Krugman and Joseph Stiglitz, all agree that high levels of inequality are a serious problem, if not the problem, facing our weak economy.



According to this liberal thesis, either the 2008 financial crisis and its attendant recession, or the sluggish recovery — and maybe both — can be attributed in large part to the high level of economic inequality in the United States. Further, in this view, inequality is an economic malady on its own, even in times of prosperity.

Brennan then goes on to show how these liberals are surely wrong.  The financial crisis may just possibly have been caused by inequality, specifically middle-income Americans trying to "catch up" with the rich.  But you don't have to find a reason like that.  Just good old cheap money will do it for you.



No it's pretty obvious what is going on.  If you want to justify government intervention you have to argue injustice; otherwise you will quickly find that you don't have a justification.



Here's how I look at this.  There are two competing explanations of the modern lifeworld.  One is the 200-year-old Invisible Hand.  It argues that the economy is basically just and the way to get ahead is to find something that the consumers want and sell it to them.  The other explanation is exploitation, from Marx in The Communist Manifesto.  It argues that the basic fact of human society is exploitation.  So political activists are called upon to fight for the exploited and against the exploiters and knock down the walls of privilege and injustice.



Back in 1850 the Marxians had a point.  Plantation slavery was still churning out sugar in Brazil and cotton in the American South.  And pauperized agricultural laborers were appearing in the city and working for starvation wages in the new textile factories and mines.  Something had to be done.



It turned out that the net effect of capitalism and democracy from those times has increased the daily income of the average European and North American from about $1 to $3 per head per day to the current $120 per head per day.  So, whatever the combination of Invisible Hand and exploitation and the political response, we did something right.



So the full-on exploitation theory loses some of its bite.  And if exploitation is no longer an explanation then the argument for a strong government loses its bite as well.  Maybe we could get along with a lot less government force.



Enter the inequality theory.  It provides an all-inclusive explanation for all economic ills.  And it requires educated experts to design and implement programs to correct inequality.  Thus it provides a moral justification for the Democratic Party and its over-under coalition: a ruling over-class of educated liberals extracting taxes from the rich 1% and giving it to the under-class of victims, less an appropriate finder's fee, of course.



The whole thrust of modern politics in the US--the red-state blue-state battle, the culture war, private vs. public sector--is an argument between faith in an Invisible Hand lifeworld and faith in an exploitation lifeworld.



In the Invisible Hand lifeworld if you study hard and work hard to get ahead you will achieve your goals and live a successful life.  In the exploitation lifeworld you need a community organizer to fight for your rights.



Everything else is noise.

Persuading the People: Patronage or Profits

How do you grow the economy?  That's the one-and-only question before the voters this November.  President Obama says that the private sector is "doing fine" and the solution is in government investment.



According to the president in his Ohio speech, reports to Daniel Henninger, the difference is between the Romney plan that wants to grow the economy "from the top down" and the president's plan, "an economy that's built not from the top down, but from a growing middle class."  Oh really, writes Henninger:

There is no theory anywhere in non-Marxist economics that says growth's primary engine is a social class. A middle class is the result of growth, not its cause. Barack Obama not only believes in class-based growth but has built his whole growth strategy around it.

Mitt Romney is running around talking about the "liberating power of the free enterprise economy" but who knows what that means, worries Henninger.  It still provides President Obama with a chance to confuse. "Team Romney should not underestimate the appeal of Mr. Obama's confused economic ideas if drilled daily into the electorate's soft clay."



But it is not the job of a politician to persuade the voters that profit or the free enterprise economy is good.  People have been trying to do that for decades with indifferent results.  Here is Robert Tracinski with a good college try:

A profit is simply the net creation of wealth. It means that the economic value you created from a business—the goods and services you were able to sell—have greater economic value than the resources you put into running the business and paying its workers. It is your profit, the extra money left over after you pay your expenses, that allows you to expand your business, prosper and yes, hire more people.

Seems pretty straightforward.  But it relies on a world-view that believes in Adam Smith's Invisible Hand.  There is another world-view, and it says that profit comes from exploitation, that this is a dog-eat-dog world and the only way to scratch a living is to attach yourself to a powerful patron and gather up the scraps from his table.



Mitt Romney is selling the Invisible Hand world-view and President Obama is selling the patronage world-view.



You may say that the science is in on this.  Profits create prosperity wherever they are allowed, and patronage creates poverty wherever it is tried, just like it did for the 50,000 years of the agricultural age.  But the fact is that lots of people believe the patronage line.  When people migrate from the country to the city they usually believe in the patronage world-view because that the the way the world works in the countryside.



People that believe in exploitation and patronage join unions and vote for politicians that promise to extract something from the greedy rich.  People that believe in the Invisible Hand vote for politicians that promise to lower taxes and government spending.



This is no time to persuade people that believe in the patronage world-view; it is a time to rally the people that believe in the Invisible Hand.



But what do you do about the folks like my single-mom hairdresser who is mostly worried about high gas prices?  She's never heard of "fracking," so she knows nothing about the revolution in oil/gas exploration that will bring gas prices down if only the Obami regulators would get out of the way.



For those confused folks in the middle, you just say that "Obama Isn't Working."  What a surprise; that is just what the Romney campaign is doing.

America Grows Apart

Liberals have been selling the notion, recently, that the Republican Party is growing more and more extreme.  E.J. Dionne, Jr. has argued that Republicans have been moving out to the individualist extreme, leaving community behind.



Now the Pew Research Center for the People and the Press has come out with its Trends in American Values: 1987-2012, and reports that the gulf between the parties is increasing.  Probably the biggest change is on Environment.  Back in 1987 there was a 5 point difference between Democrats and Republicans on the environment.  Today it is 33  points.  On Governmnent Scope and Performance the gap used to be 6 points; now it is 33 points.  On Social Safety Net it used to be 23  points; now it is 41 points.



Propping up E.J.'s argument, the gap has increased mainly because fewer Republicans (and to a lesser extent, Independents) believe that the "government should take care of people who can't take care of themselves" and that "there needs to be stricter laws and regulations to protect the environment."  In other words, Republicans have moved away from the New Deal and Sixties consensus.  Why?  Well, I expect that if you asked a Republican she'd say that the government can help take care of people who can't take care of themselves.  But after a point the government makes things worse rather than better.  Oh and by the way, the global warming movement is a scam.



But wait, you say. What about that female Republican?  Isn't the Republican Party the party of dead white males?  Er, no.  Here's an interesting take from the Pew poll.  In 2012 Republicans are 50% male and 50% female.  Almost perfectly representative of Americans as a whole.  It is the Independents and the Democrats that are unbalanced on gender.  Democrats are 41% male and 59% female, about the same as currently graduating college students.  But Independents are 55% male and 45% female.  Who would have thought it?



Overall, Independents tend to be economically conservative and socially liberal.  So that might explain why President Obama is in such a pickle this year.  Independents this year are not too exercised about social issues, but they are certainly interested in economic issues.



Pew compares "swing" voters ("either undecided, only lean toward a candidate, or favor a candidate but say there is still a chance they will change their minds") with Obama and Romney voters.  Their attitudes tend to be right in the middle between the partisan voters, but tend a little more towards Obama voters than Romney voters--except on the Social Safety Net, Immigration, and Government Responsiveness.



It is interesting that the Pew survey does not really ask questions about middle-class entitlements.  If they did, I wonder what they would find?  Pew asks questions about health care and finds that people are more concerned in 2012 about too much government in health care than in 2009 (with Democrats not concerned).  And of course everyone agrees with the motherhood-and-apple-pie notion that "the government needs to do more to make health care affordable and accessible."



But remember the big takeaway.  It's about Republicans.  Yes, they are certainly as white as a picket fence, but they are not male.  It's a 50-50 splitsville between male and female in RepublicanLand.  And don't you forget it.

Ann Romney's MS Story

I first became aware of Ann Romney's battle with multiple sclerosis when the left raised the issue of her expensive horses.  It turned out that she had started riding horses as a therapy for MS.  Imagine what would have happened to any conservative sneering at a Democratic wife's debilitating disease.



Today there's a long article by Katrina Trinko in NRO about Ann Romney and her MS story.  It's the usual "heart-warming" story that you expect to see all over the checkout stands at the supermarket.  Only you don't.



Is that because the women's magazines won't turn to presidential politics until after the conventions?  Or because the heart-warming story is about a Republican?  Or because the liberal women that run the women's magazines in Manhattan haven't heard of Ann Romney?



Who knows?  But I predict that when the women of America get to know about Ann Romney they will warm to her.  Because the story of Ann Romney's MS is the sort of story that women love.  It starts when her youngest son is in high school.  It involves Mitt Romney pitching in.  It involves Ann Romney moving to Utah, and various actions by her sons to provide support for her.  And then there is the horse story: how Ann Romney started riding in a desperate attempt  to have something to focus on.



And then there is the story of Ann Romney running a relay with the Olympic torch.

And then Mitt Romney nominated his wife — without telling her — to carry the Olympic torch, citing her as his personal hero. It would be an arduous task for her: Those who carry the Olympic torch run for a quarter-mile before relaying the torch to the next person. For weeks beforehand, Romney practiced, building up her strength.



“She was able to jog the whole thing,” remembers Josh Romney, who was there with her, running alongside his mom.



“I literally ran,” Romney says, describing how she carried the torch, with friends and some of her sons present. “My kids were all surrounding me,” she says. “And they were all crying because they knew what a miracle it was that I came [to Utah] barely able to walk and now [here] I was, three years later, torch in hand, the Olympics were a success, I was back on track, I was regaining my strength, and off I ran with this torch into the city.”

I know what you are thinking.  Doesn't the First Amendment forbid the publication of this sort of story that suggests, ever so sweetly, that evil Republicans are human too?



To which I answer: who knows?  If the Supreme Court can fling a decision like Citizens United into the faces of the progressive blogosphere, who knows what is allowed in America any more?

Conservatism Using 20th Century Ideas

For years I've been wondering how we get past the banalities of the liberal welfare state and develop a new basis for a free society.

But I've felt for years that the solution is not just imposing a conservative ideology, especially an ideology based on the pre-Kantians like Locke and Hume.  No, we must justify a new birth of freedom on the philosophizing and the thinking of the last century, not the 17th century.

That's a problem for a conservative because almost all the advanced thinking of the last century has been lefty thinking.  Yet, I felt, the only way to persuade our liberal friends that their unjust welfare state was an abomination would be to show how their own thinkers point to a world beyond the top-down bureaucratic state run by and for the educated elite.

It wouldn't hurt if it were German thinkers that would get us out of the mess. After all, it was they--Kant, Fichte, Hegel, Marx--that got us into it.

Central to the whole problem, for me, was the problem of understanding what on earth philosophy in the 20th century was all about.  Fortunately for my sanity, in the last year I have finally realized what was going on.  It was Jürgen Habermas that gave me the clue.  Here he is at the beginning of Volume Two of The Theory of Communicative Action.

Early in the twentieth century, the subject-object model of the philosophy of consciousness was attacked on two fronts--by the analytic philosophy of language and by the psychological theory of behavior.[my emphasis]

Instead of "self-knowledge, reflection, or instrospection" thinkers worked from "linguistic expressions or observed behavior" and did not appeal to intuition.

OK?  So what does all that Teutonic mush add up to?  Just to this.  When Descartes wrote "I Think therefore I am" and invented the modern idea of the "ego," he was talking baloney, because to articulate the ideas "I think" and "I am" you must first have language.  In other words, we develop our self-consciousness from the language in which we communicate to other people.  There is no "I" without a "You".  There is no "ego" without an "alter".  That is what Wittgenstein meant when he wrote that there is no "private language."  Language is something you do with someone else.

This is a momentous discovery, because it demolishes, e.g., the opposition between individualism and community.  Why?  Well, on the philosophy of language, the idea of the individual, me, is impossible without another individual, you.  Therefore I and You form a community.  There is no such thing as a mountain man utterly separate from human community.  The proof is Ted Kaczynski, the Unabomber.  He might have hid himself away in a hut, but he longed to communicate with the world, and he did, with his manifesto.  His thinking would have been a lot better if he had communicated with the outside world and aligned his fantastic world with the real, social world.

The word that Habermas uses for the shared world of I and You is "lifeworld."  He means the shared assumptions about the "always already" stock of shared knowledge and assumptions between any two  people or any group of people in the world.  He got to that idea from the problem raised by Horkheimer and Adorno in Dialectic of Enlightenment.  These Jewish refugees from Nazi Germany came to the view that reason is about domination.  We use reason to dominate nature and other humans. "What men want to learn from nature is how to dominate it and other men." This applies to capitalism, they reasoned, and also government.

So how do we get away from pure domination and into a less exploitative relation with our fellow humans?  We get away from the philosophy of consciousness and its focus on I, I, I, and start thinking in terms of a philosophy of language, of we, we, we.

To do this, Habermas differentiates the experience of the world into three: the objective world, the social world, and the subjective world.  His idea of communicative action "relies upon a cooperative process of interpretation in which participants relate simultaneously to something in the objective, the social and the subjective worlds".   Reality is not just me and my thoughts, as rectified by experience and experiment.  Reality is mediated also by social interaction--conversation with other humans.

There is nothing in conservatism that does not align with this idea of reality.  Our whole world view is founded upon the ideas of Edmund Burke and the "little platoon," the person to person negotiation of the lifeworld.  Capitalism too is understood by this view, for it is the moment to moment negotiation of making and serving and selling and buying from person to person, using the objective world, relying on subjective ideas, and testing them in the social world of the market.

But the liberal welfare state and its bureaucracies are built upon the restriction and the marginalization of the social world.  The liberal welfare state is 2,000 page bills setting forth the inflexible objective rules for behavior and interaction.  There is no room for a "cooperative process," no room for "we," nothing left of humans as social animals.

I ask you: What will our liberal friends do when we come at them with a conservatism built upon the latest ideas from the 20th century and the philosophy of language?

The answer is: They will not know what to do, because their whole world will seem to be collapsing around them in ruins.