Saturday, April 28, 2012

The Small Government Fallacy


© Charles D. Hayes

Politically, today’s cry for small government has more to do with reducing government power than its size. Granted, without accountability, any agency, public or private, can balloon beyond its reason for existence. But try to imagine this: big oil, big banks, big cyber companies, big finance, big pharmaceutical, big retail, big transportation, big aviation, big utilities, big insurance, big lobbyists, big tobacco, big prison industry, big media and a big military industrial complex overseen by a little government.

To the ideological right, this is heaven on Earth. To the working men and women in America, this is a quicker road to serfdom than anything that economist F. A. Hayek could have conjured up — a land of Goliaths and a population of Davids, where wages, pressured by global corporations, experience free-fall.

Put another way, this kind of dream portends a 21st century with corporate fiefdoms and an ever-growing number of consumer-serfs. It frees up the power of the already powerful. Worse still, government collusion with big business that transfers public wealth to private executives, in what Naomi Klein calls corporatism, erases all hope for a better future for average Americans. The feudalism of the Middle Ages can’t really be that much different from what could become of America if the growth of income inequality continues to escalate.

To her credit, novelist Ayn Rand warned against government complicity with big business. Too bad she didn’t know enough about human nature to realize that her virtuous fictional character John Galt is a creature that does not exist in the real world of business.

All John Galt pretenders are causalities to vice or corruption of one kind or another. That’s why we need a government that’s accountable to the people and has enough muscle to deal with giants without being intimidated or stomped into submission.

It is a well-accepted premise that pure communism and pure socialism are unworkable ideologies. But so is pure capitalism. The wants, needs, temperaments, talents, beliefs and traditions of human beings with diverse backgrounds require an economic system calibrated to sustain a high quality of life for all citizens, not just a few super-needy individuals following a myopic ideology.

Hayek maintained that government involvement in the economy would lead to serfdom. Indeed, corporatism does the trick. But so will capitalists accountable only to markets that they create and control. There are many roads to serfdom but none quicker than the thoroughfares run by international corporations shadowed by small, ineffectual governments.

A few years ago, Dutch economist Jan Pen asked us to imagine people’s height as being proportional to their income, making average income equal to average height. He asked us to picture everyone in America walking by us in one hour’s time in ascending order of their income.

In the first several minutes of the procession, the passersby would be invisible. It would take 45 minutes before people of today’s normal height would appear. Then, with six minutes to go, giants would begin to pass by. And near the end, these individuals would be more than two miles tall. Of course, that was some time ago. Today the last few would likely be much taller.

A close reading of American history shows beyond a doubt that our health as a nation is dependent in large part on a vibrant middle class. Extreme inequality severely weakens our economic foundation.

The incessant roar to reduce the size of government has so oversimplified the politics of the matter that few people even give the issue much thought. It’s simply accepted as fact by a growing number of people that all of the world’s ills are due to big government, end of story.

Thomas Jefferson, Thomas Paine and Henry David Thoreau are often mentioned in connection with the assertion that “the government that governs best is the government that governs least.” This declaration is no doubt true. But it also has less to do with the size of government than with efficiency and effectiveness.

All three of these men were strong advocates for effective government, and after making the statement above, Thoreau clarified that his aspirations were not necessarily for making government small but rather for bringing about better government. We would be well advised to heed his wisdom. Instead of continuously ranting about the need for small government, we must decide, once and for all, what we expect from government and then make sure we get it.

Capitalism is an extremely powerful system, so much so that it cannot be sustained without safeguards. To make America safe for “creative destruction” requires responsible citizens and the collective authority to see that we are not overrun by giants accountable to no one but themselves. Our anthem is “We the people,” not we the serfs.

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Tuesday, April 3, 2012

Duped By the Freedom Ploy

© Charles D. Hayes

For decades millions of people from all over the world have been leaving the land and moving to cities to find work. In China they flock to manufacturing jobs that produce products for Apple and for retail stores like Wal-Mart and Target, among many others. Most of these people work incredibly long hours for exceptionally low wages, while living in squalid conditions. After a few short years, the knowledge they had once applied to barely scraping out a living off the land is lost, and so is their access to land. Now, when people in this situation number in the tens of millions, what do you think happens during a deep recession, when people stop buying the products they make? The word destitute is grossly inadequate to describe their circumstances. The notion of freedom without real opportunities for gainful employment is a facade.
A similar situation applies to people out of work in America who wind up living on the street, and it applies to people who are seriously ill but without health insurance. Of course, they are free to purchase their own health insurance, but in many cases, not only can they not afford it, what they are offered, if left up to the "free market," has so many escape clauses that a serious illness will still mean bankruptcy. And yet, time after time, year after year, commercial after commercial, the argument against a single-payer healthcare system (which I am personally for) is said to be an argument about freedom. Stopping Obamacare is said to be about freedom. Getting rid of the mandate is all about freedom. Indeed, it is— it's freedom for profits at the expense of individual healthcare. The existence of freedom in a system rigged by the insurance industry is an illusion. Without an overt and ongoing concern to adjudicate a system that promotes fairness with insurance industry accountability, the existence of freedom is more apparent than real. 
We still champion rugged individualism in America, born of a time when most people lived on small farms. It was a time when it was still possible to avoid starvation by scratching something out of the dirt. But, like the Chinese workers making products that are not selling in Wal-Mart, Americans who live and work in the city in times of economic downturn and high unemployment can easily, through no fault of their own, become penniless.
So why, one wonders, is the loudest cry coming from politicians who want to reduce the size of government to a level where it will be unable to help people who are destitute? Why is small government their number one goal? What, pray tell, does this have to do with freedom, when economic circumstances render absurd the very idea of freedom in a workplace that's dependent on market whims, unless real options for earning a living are readily available?
Essayist Isaiah Berlin wrote about two fundamental types of liberty: negative and positive. He said the meaning of the word freedom is "so porous that there is little interpretation that it seems able to resist." Negative freedom he characterized as a power to choose between options though, in some cases, they may represent undesirable choices. Positive freedom, on the other hand, he said derives "from the wish on the part of the individual to be his own master."
Arguing about positive and negative liberty in a technical sense can get philosophically complicated. But here is a simple way to approach the issue of freedom. Think, for example, of freedom in an extrinsic versus intrinsic sense: choosing the least negative option among many bad or not so good choices, or having the power to do something for no other reason that you really want to and can afford to do so. Compare having to accept a bad job because you can't find a good one against having the wherewithal to do something inspiring. This is the dilemma most of us face as we seek employment from the beginning to the end of our working lives.
So here is some historical reality to help us cut through much of the hype about freedom. Simply put, it takes a great societal investment like post–World War II America to create the kind of economic conditions that make intrinsic choices possible for average Americans. Apply the Horatio Alger notion of pulling yourself up by your own bootstraps to the Chinese workers in the scenario above. Ask yourself how much opportunity those individuals have to make intrinsic choices or even viable extrinsic choices.
There are recent news reports of Chinese workers in factories who are so desperate to change their deplorable working conditions that some have threatened mass suicide. Indeed, Apple is requiring workers in China to sign a pact not to commit suicide, while putting nets around their tall building for those who become so distraught that they can't uphold their agreement. You think these people couldn't tell us a thing or two about the definition of freedom?     
Now in contrast, consider the period I grew up in during the 1940s and 1950s, a time when taxes in the upper brackets were very high and the government investment in infrastructure and education was enormous. It was a time when the GI Bill enabled millions of service men and women to go to college without incurring a mountain of debt. A time when construction of the interstate highway system and rural electrification put millions of people to work and enabled them to purchase homes and automobiles with the promise of sending their own children to college.
This was inarguably a time when millions of Americans experienced intrinsic and extrinsic freedom. They were able to choose from a myriad of extrinsic options and, in many cases, turn them into an intrinsic experience. Remember Abraham Maslow's theory of self-actualization? The theory depended in large part on a person's ability to act intrinsically. Once again, contrast this with the opportunity of the Chinese workers above, and then compare it to America today and the incessant cry for lower and lower taxes and smaller and smaller government. The high tax rate during the 1950s incentivized reinvestment in business to avoid taxes, and the positive effect it had on the economy allowed the choices possible to skyrocket for anyone with the gumption to make something of themselves.
Newt Gingrich advocates a metaphoric trampoline to replace our government's safety net for the unemployed. It's a great metaphor, but a bounce off the trampoline is meaningless without somewhere to land better than China's example of actual nets around their manufacturing facilities. Real freedom is possible only when failure is not catastrophic. Work that pays barely enough to scrape by is antithetical to democracy because democracy requires citizen involvement, and that requires a surplus of leisure time for people to devote to the process.              
Freedom without an ongoing investment in both hard and soft infrastructure is an illusion. Chinese workers who have to spend every waking hour working at slave wages just to get from one day to the next have something insightful to teach us about the existential nature of freedom. The significance of freedom is bound to resources and opportunity, and in every developed nation in the world where a high quality of life exists, this kind of investment is substantial and ongoing. In the majority of developed nations in the world, an enviable quality life is demonstrably attributable to an overt government effort to establish a baseline of opportunity above and beyond individual ownership and private enterprise, complete with the authority to meet the power of private enterprise with the power to regulate.
Vehicles don't run on fumes, and great societies don't exist without great investments in their infrastructures, from highways and bridges to institutions of higher learning able to offer tuition arrangements that don't make college students indentured servants to financial organizations. Rich and free societies are analogous to healthy gardens: When the soil is rich with nutrients, plants thrive, and adding fertilizer does not occur by happenstance—it is a purposeful effort.   
Now consider the resource-rich country of Qatar, located between Saudi Arabia and Iran. Qatar is not a democracy; it is a government administered by an emir, something we would equate with a dictatorship. But citizens of Qatar are free to pretty much do as they please. They have free medical care in state-of-the-art hospital facilities, free education, including college, and even free water and electricity. Moreover, whatever occupation they choose, they can be confident that they will be well paid. Now would these people be justified in referring to Qatar as the greatest country in the world? Are they really free? Are we? What's the difference that makes us freer in absolute terms?
In response our argument could be, "But of course the people in Qatar are not really free, because they can't vote and they are ruled by the rich," to which their citizens would likely say, "So, your point is?" We would say, "If the emir deemed you an enemy of the state, you could be thrown in prison without due process of law." Again they would likely say, "And your point is?"
George W. Bush has often been described as someone born on third base, who thought he'd hit a triple. You see, people who are able to act intrinsically, whether it is because of natural talent or because of their privileged family connections, have a strong tendency to believe themselves to be especially deserving individuals while the less privileged masses of people simply don't measure up. If you don't believe it, ask them. People who have easy access to the kind of resources that enable them to make intrinsic choices in life readily accept the notion that their access is due to the virtue that they are naturally possessed of and that escapes so many others. As humans, it is simply part of our nature to assume a stance of virtuous superiority, unless we understand human psychology well enough to know how our Stone Age minds default to our own benefit and sort the circumstances in our favor, regardless of factual reality.  
The underlying belief that freedom is something that exists only in the absence of collective effort is absolute nonsense. Like a bountiful garden, civilization requires a resolute investment in the kind of things that give rise to a middle and an upper class. Happenstance doesn't cut it. To stand before an audience of working people who can't afford the rising costs of health insurance and to speak wistfully about freedom as an argument against universal coverage in favor of the freedom to look out for yourself, as so many politicians do, is as despicable, as it is ridiculous. That so many people fall for the argument is deeply disappointing.
          Here are four examples for comparison:
·        The plight of Chinese factory workers 
·        The creation of America's middle class after World War II
·        The country of Qatar
·        America as it is today
The America of today has a crushing debt with a crumbling infrastructure and millions of poor people duped into clamoring about a lack of freedom because they may soon be required to purchase health insurance. The argument that Obamacare is an act of oppression is a cultural hallucination with tragic consequences for millions of Americans. Obamacare is a noble attempt to do what existentially insecure individuals seem to fear most: universal coverage.   
Of course, the citizens of Qatar would likely view the whole prospect of for-profit health insurance as a scam because they know, as any thinking person should, that profit will be a greater priority than medical treatment. And in the case of Americans who are supposed to purchase insurance under Obamacare but don't, what will happen? The Chinese would likely assume imprisonment, but, no, that's not true. What will happen is that their taxes will go up a little.
The irony in this bogus argument about freedom is that the co-pay in most private, for-profit health insurance policies will still ultimately break most people who become seriously ill, if they are not already rich. That the insurance companies and the bought-and-paid-for politicians who do their bidding have succeeded in making resistance to universal care a notion about freedom is sheer lunacy on one hand and political genius on the other. The notion of freedom as a choice to purchase that which is unaffordable and defective, is a Ponzi scheme of the imagination.
The bottom line is that any country that cannot generate enough goodwill to see that everyone has access to adequate medical care should be embarrassed to refer to itself as the greatest country on earth. We must get beyond the concept of freedom as a hot-button distraction before we can figure out what it really means to be free. Having a chance to buy something you can't afford, or having health insurance that still won't keep you from going broke even if you could afford it, is not an intrinsic expression of freedom. No, it's a horribly bad joke made possible by those who know how to use fear effectively for political purposes.
This is not rocket science. If not for our Stone Age minds, it would be considered common sense. Freedom existed in hunter- gather societies because choices were still possible, even when resources were scarce. In societies dependent upon commercial goods and services, freedom requires an enormous investment in the kinds of things that make extrinsic and intrinsic choices possible. Such conditions require much higher taxes that we are currently paying across the board.
Is there waste in government spending? You bet. But, even if most of it were dealt with, higher taxes are still needed to pay the debt for what we have already consumed and for the maintenance of our infrastructure that has to be constantly and consistently maintained. Over a thirty-plus year period, America has been looted from the top down, and the public still bites at wherever the stick points instead of at the hand that holds it. Do we need to guard against free riders and people who expect something for nothing? You bet, but it makes no sense that we excuse this kind of behavior in the rich and yet condemn the poor for doing the same thing.
Entire workforces that depend on the whims of markets turn on its head the old-fashioned notion of freedom that prevailed when most people lived off the land. A market based on goods and services is not as rich in resources as a farm or a piece of land. A farm can fall on hard times, but there is still the possibility of putting food on the table. A market can close on a dime. A garden without a rich investment of nutrients and a concentrated effort to sustain it becomes a bed of weeds while a country without resources becomes a slum.
To have a great country with a small government, where taxes are always low, where people thrive off each other's efforts without an aggressive investment in infrastructure is a utopian fantasy. Such a nation has never existed, except in the imaginations of ideologues who mistake their wants for reality despite a mountain of evidence to the contrary. Depending entirely on trickle down is a sleight-of-hand psychological trick that always promises but never pays off. At the same time, it constantly refuels itself with high-octane contempt because it evokes a fear ensconced in identity and one that results in a natural fear of the other. 
 Those who shout the loudest about freedom seem to know the least about what it really and truly means to be free. Franklin D. Roosevelt captured the essence of real liberty when he named the Four Freedoms: Freedom of Speech, Freedom of Worship, Freedom from Want, and Freedom from Fear. Educationally people have to understand the human condition well enough that ideologues can't use the fourth freedom as a substitute in bait- and-switch fashion to keep people so anxious that they don't realize that the third freedom applies only to those who are rich enough to rig the system.
Without a substantial investment in hard and soft infrastructure, Ronald Reagan's shining city on a hill is a mirage. Reagan suggested the nine words we should fear most are "I'm from the government and I'm here to help." Now, I don't doubt for a moment that Reagan believed those words, but judging from a practical standpoint how the reality of his contempt for government has played out, the words to fear most should have been "I'm an ideologue and I'm here to deceive you," because that is precisely what he did. He deceived himself. The utopian dream of an America without a substantial government investment in the creation and maintenance of a middle class is why our current politics are dominated by imbecilic notions of drowning the government in the bathtub.
We can dramatically reduce the size and power of government. We can get government down to the dimension that it can be metaphorically drowned in the bathtub, as Grover Norquist advocates, but one thing is certain: during wild market swings, American workers will have a lot more in common with their counterparts in China than with those in Qatar. The great tragedy of our time is that a few well-placed symbols, slogans, or thirty-second commercials can so thoroughly enrage people that they are unable to distinguish actual freedom from propaganda. Even in the twenty-first century, us versus them is still a magic potion for confusion, delusion, and if all else fails, hatred.
America is the tribe that isn't. Adolescent vitriol fostered by ideologues keeps us from generating enough good will to see that every American deserves a fair shot at a good life and medical treatment without winding up on the street or in one of China's safety nets.       


Charles D. Hayes KINDLE Books and EBooks on Amazon:

September University: Summoning Passion for an Unfinished Life
Existential Aspirations: Reflections of a Self-Taught Philosopher
The Rapture of Maturity: A Legacy of Lifelong Learning
Beyond the American Dream: Lifelong Learning and the Search for Meaning in
Proving You're Qualified: Strategies for Competent People Without College Degrees
Training Yourself: The 21st Century Credential
Self-University: The Price of Tuition is the Desire to Learn. Your Degree is a Better Life
Portals in a Northern Sky: A Novel
A Novella
Pansy: Bovine Genius in Wild Alaska
Alaska Short Fiction Series for Kindle
Moose Hunter Homicide
KINDLE Essays on Amazon:
Aging Existentially: Getting the Most Out of the Fall and Winter of Life
America’s Greatest Enemy: Ignorance
Atlas Begs To Differ: Why It’s a Mistake to Believe in Ayn Rand
Class Warfare: Is It Real? Is It Over? Or Has It Just Begun?
Heroism, Cowardice, and the National Tragedy of Hidden Guilt
Learning A Living: Career Success Without Formal Credentials
Nostalgia: Why the Past Matters
Pursuing Justice: Foxes, Hedgehogs, and the Baby-Boom Legacy
Why Political Dialog Is Disingenuous
NOOK Books and Essays on Barnes & Noble
Portals in a Northern Sky: A Novel
Aging Existentially: Getting the Most Out of the Fall and Winter of Life
America’s Greatest Enemy: Ignorance
Atlas Begs To Differ: Why It’s a Mistake to Believe in Ayn Rand
Class Warfare: Is It Real? Is It Over? Or Has It Just Begun?
Heroism, Cowardice, and the National Tragedy of Hidden Guilt
Learning A Living: Career Success Without Formal Credentials
Nostalgia: Why the Past Matters
Pursuing Justice: Foxes, Hedgehogs, and the Baby-Boom Legacy
Why Political Dialog Is Disingenuous
Websites
Autodidactic Press Website
September University.org Website

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Self-University Blog
September University Blog