Mister, that sure is one big baby...
June 12, 2003 10:59 AM   Subscribe

Drowning the government in a bathtub - "My goal is to cut government in half in twenty-five years, to get it down to the size where we can drown it in the bathtub." Thus spoke Grover Norquist, of Americans for Tax Reform. "The lunatics are now in charge of the asylum", quipped the conservative UK Financial Times. Hardly, says Paul Krugman. The strategy?: "Instead of challenging popular liberal programs directly, the Republicans are creating fiscal conditions that make those programs unsustainable." [lead post, Am. Prospect]. In other words, the 400 billion dollar deficit, coupled with the Bush tax cuts, is designed to shift the obligations of the Fed onto the States and, later, to cause a fiscal train wreck after Bush is out of office.
posted by troutfishing (58 comments total)
They way they avoid metnioning cutting teh military looks to me like they're trying to hide a dinosaur behind a lamppost and hope you don't mention it.
posted by Space Coyote at 11:04 AM on June 12, 2003

Friedman: Tax cuts = Service cuts.
posted by goethean at 11:10 AM on June 12, 2003

Where is the non-christian, fiscally conservative, small government political party in this country? I voted for Perot when he was running - despite his other baggage I though his frank discussions of the nations balance sheet was important. I find it very frustrating that nobody cares about this stuff - at least cares enough to learn about seriously precarios situation our govt. balance sheets are in.

There was a report done by O'Neill while he was Secretary of Treasury (curiously, just before he was fired, and his report removed from the budget) which found that the true national debt, measured in the same way that we force companies to prepare their balance sheets, was approximately $44 trillion, much higher than "official" numbers of $6.4trillion. (The major difference is in reference to the woefully underfunded national "pension plans, ie social security and medicare").

something has to give; my best guess would be the dollar. scary stuff.
posted by H. Roark at 11:21 AM on June 12, 2003

Salon has a headlining article on this as well today. Their focus is train wreck the budget to privatize Social Security.
posted by dirtylittlemonkey at 11:21 AM on June 12, 2003

Space Coyote, the military is considered an essential part of the Federal Government's duties while social programs are considered out of the scope of the Federal Government for conservatives and libertarians. So the big dinosaur hiding behind the lamp post is okie-dokie as long as it's brandishing military hardware and not asking for an education.
posted by substrate at 11:23 AM on June 12, 2003

They're not necessarily hiding it, Space Coyote, but they're far from publicizing the information. If you do a little digging around on the White House Budget Office's website, you can find this page full of information in downloadable Excel Files.

Some brief numbers that I calculated yesterday for a discussion....

A full 16% of the Federal Gov'ts money is expended on the military (and this does not include the DOJ or Office of Homeland Security). Additionally, the DOD budget is expected to increase by 33% between this year and 2008. All this while the Federal Budget is only expected to increase 8.8%, so in the next five years, that 16% will increase to nearly 19% or roughly one-fifth of our tax dollars.

Compare that to the EPA who receive a whopping .36% of the federal budget. Their budget is expected to increase by only 3% over the next five years (after decreasing next year actually) knocking their allocation down to .34%.

I haven't got time to go through every department, but I'd be interested to see the projections for allocations in the various departments through 2008.
posted by Ufez Jones at 11:24 AM on June 12, 2003

Not to be snide, but wasn't this painfully self evident over a year ago?
posted by rhizome23 at 11:24 AM on June 12, 2003

Friedman's advice should be heeded by all of the Democratic candidates:

I would suggest that henceforth Democrats simply ask voters to substitute the word "services" for the word "taxes" every time they hear President Bush speak. That is, when the president says he wants yet another round of reckless "tax cuts," which will shift huge burdens to our children, Democrats should simply refer to them as "service cuts," because that is the only way these tax cuts will be paid for — by cuts in services. Indeed, the Democrats' bumper sticker in 2004 should be: "Read my lips, no new services. Thank you, President Bush."
posted by homunculus at 11:29 AM on June 12, 2003

rhizome23 - To you, at least (and that's a compliment). But the associated figures - the current deficit, the projected long term budget shortfall, the National debt, and so on - have all gotten much, much worse.

And as Krugman notes, it's only very recently that the media mainstream has acknowledged the "drown the gov. in the bathtub" strategy. The strategy was employed as far back as the Reagan administration, but it was considered fringe, conspiratorial stuff to talk about it then.
posted by troutfishing at 11:31 AM on June 12, 2003

I just hope all this fiscal smoke and mirrors doesn't land us in the bog Japan's been sinking in for a decade.
posted by rhizome23 at 11:37 AM on June 12, 2003

Compassionate conservatism at work. They got theirs, we can go fuck ourselves.
posted by Cerebus at 11:40 AM on June 12, 2003

Maybe this is a derail, but I've never liked that lunatics-running-the-asylum metaphor -- I've been acquainted with a situation where patients were encouraged to take part in running their instititution, and it actually helped them focus on reality and stop being passive recipients of their therapy.
posted by alumshubby at 11:48 AM on June 12, 2003

An economist once told me that the most efficient of government programs spends only 25 cents of every tax dollar it receives on the actual program, depleting the other 75 cents on "administration". Intense pressure from the executive cannot make this more efficient, but *can* make it less efficient, wasting more of the assets of the programs which he does not approve.
Do not interpret this as anti-government, however, he said, for private enterprise is even *less* efficient with allocated funds.
He then pointed out that "administrative" costs are mostly "personnel" costs, the #1 expense in almost all large endeavors. "Cost cutters" therefore always assume that there are redundant workers, or that they can force existing workers to endlessly increase their "productivity" to accomplish what more workers did before.
Bureaucrats automatically respond to "cost cutters" with a "cut the meat, leave the fat" approach, which usually forces the "cost cutters" to look elsewhere.
Ironically, the US government is perhaps the most "efficient" in history, defining "efficient" as a ratio of what a government promises vs. what it delivers. So this means that for there to be *any* cutback, the government will have to reduce what it has promised.
posted by kablam at 11:54 AM on June 12, 2003

No no, Cerebus -- compassionate conservatism is "they got theirs, we can go make love to ourselves.
See the difference?
posted by uosuaq at 12:42 PM on June 12, 2003

Bateman cartoon that summed it up for me. "Evil, but brilliant." Also, tax cuts every year?
posted by azimuth at 1:04 PM on June 12, 2003

alumshubby - I'd be the last one to compare the Bush Adm. people to lunatics, though I do think they're subtly deranged (drunk on power, that is). But the Brits love to poke fun at those "wacky Americans". And we are wacky.

Have you ever seen "The King of Hearts", by the way? In this classic tragicomedic antiwar film, the lunatics do wind up running the asylum, as well as inhabiting the entire town.

Kablam - I think that was old school thinking about the possible efficiency levels of Gov. programs. Computers and the internet, for example, can boost efficiency quite a bit. Still, I'd certainly believe you that there are efficiency limits.
posted by troutfishing at 1:13 PM on June 12, 2003

I wouldn't mind spending money on the military so much if it was defending our borders and not beating up small countries with little chance of truly damaging America's military might. It also doesn't make me feel good to know missle defense gets more money while veteran's health benefits are cut. Not to mention the huge amount of waste and inefficiency in funding projects via the military when direct R&D is more efficient.

Oh, and when will we get rid of unfunded Federal mandates?
posted by infowar at 1:25 PM on June 12, 2003

infowar - about the time, I'd say, when you look out your window and notice that all your neighbors are walking their Giant Gambian Pouched Rats on leashes, like dogs.
posted by troutfishing at 1:31 PM on June 12, 2003

kablam: That economist you talked to is an idiot. Medicare runs its program at about 3% administrative costs. HMOs run anywhere between 15%-30%.

trout: You missed the better Norquist quote: "We are trying to change the tones in the state capitals -- and turn them toward bitter nastiness and partisanship. Bipartisanship is another name for date rape."
posted by gramcracker at 1:41 PM on June 12, 2003

Can't find it online, but Harpers is running the best article yet about these heart-breaking cockamammie Republican schemes. Excerpts from "Get Rich or Get Out" by Thomas Frank are about halfway down the page.
posted by DenOfSizer at 2:08 PM on June 12, 2003

Whine whine whine. I'll believe anyone cares when a leftie shows up at a GOP meeting with a gun and blows away a few reps. Until then it's all sound and fury signifying nothing.
posted by aramaic at 2:21 PM on June 12, 2003

Sounds like a great plan to me.
posted by oissubke at 4:27 PM on June 12, 2003

I'm still waiting for at least one of the democratic presidential candidates to start running with this stuff. Has anyone yet?
posted by MetalDog at 5:14 PM on June 12, 2003

Speaking of dinosaurs behind the lamppost: let's assume for a minute that Bush wants the American economy to crash, so that social programs become unsustainable, the American poor will adapt or die and (either way) cease to be a burden.

If one of the side effects of this is that, relative to other currencies, the US$ drops in value (probably by a lot: let's pull a figure out of the air and say it goes down to US$1 = 0.1 euros), this means that rich Americans aren't rich any more.

So, if this theory is correct, Bush is busily engaged in pulling the rug out from under not only those parasitic lazy poor folks, but every single American. Way to go, dude.

However, this won't occur in a vacuum; foreign investors will show up at America's yard sale with chequebooks in hand. American real estate and industry will suddenly become one hell of a bargain.

Anyway, I find it a bit hard to be disturbed by this prospect, as I am an Australian who frankly considers the world would be better off under the leadership of the EEC rather than the USA, but I also find it a bit hard to believe.
posted by aeschenkarnos at 6:47 PM on June 12, 2003

I would suggest that henceforth Democrats simply ask voters to substitute the word "services" for the word "taxes" every time they hear President Bush speak.

I would suggest that henceforth all freedom-loving people simply ask voters to substitute the words "confiscated wealth" for the words "government funding" every time they hear a statist from the Left or the Right speak.
posted by ZenMasterThis at 6:53 PM on June 12, 2003

MetalDog: Does Dean count? (I, myself, am not sure.)
posted by kevspace at 6:57 PM on June 12, 2003

...when a leftie shows up at a GOP meeting with a gun and blows away a few reps.

I thought it was the lefties who supported government confiscation of guns? After all, the right to keep and bear arms is a colective, not an individual right. Right? It must be true or the Ninth Circuit wouldn't have said it...
posted by ZenMasterThis at 6:57 PM on June 12, 2003

no, actually it's a wide stretch of the populace, both sides of the aisle, who support greater restrictions on firearms, especially in the cities.

And I'm still laughing that all the blustering "We gotta have dem guns to protect us from Tyranny" gun lovers out there are the ones CHEERING for Bush & Co. instead of taking to the streets and putting their money where their mouth is.

I can't help thinking that all these guys babbling about "the Right to Bear Arms being the ultimate source of our freedom" will one day wake up with it being the ONLY right left, having done nothing when all the rest were stripped away. What good is it then? Oh yeah, that's right, makes ya feel like a man to heft that there carbine, eh?

back to the thread though --

I don't think that Bush is after having the economy crash, just simply the government. Yeah, the government going down will play havoc with the T-Bill market (as well as all the rest). The key is not to have the government default on the debt, just to have it completely prostrate and emasculated by the service on it.

I think it's a case of the theorists behind the tactic being willing to accept that eventuality in order to reap the benefits -- selling off all the federal land holdings, privatizing vast stretches of the economy, and generally returning to an economic state resembling the turn of the century, with all that entails -- company stores, child labor, slave wages. Think of the money the corps would save without things like unemployment insurance, social security, malpractice suits, environmental strictures...

It would be an unfettered race to the bottom; a libertarian paradise... imagine the freedom of paying subscription fees to the fire and police departments.

run by Bechtel and Pinkerton, of course.
posted by badzen at 7:37 PM on June 12, 2003

When Ronald Reagan came into office, he cut taxes, we had big deficits, and we lost 2 million jobs. When Bill Clinton came into office, he raised taxes without a single Republican vote; we balanced the budget; we gained 6 and a half million jobs. George Bush has already lost 2 and a half million. I want a balanced budget because that's how you get jobs in this country is to balance the books. No Republican president has balanced the budget in 34 years . . . You had better elect a Democrat, because the Republicans cannot handle money . . . We're the party of responsibility, and they're not.

That is a little bit of what Dean thinks.

Dean has a history of balancing budgets and being fiscally smart in Vermont and this will play well with the Perot types who are looking for a no nonsense type of guy.
posted by jbou at 9:00 PM on June 12, 2003

I'm making my cardboard sign right now: Dystopia or bust!
posted by moonbiter at 10:04 PM on June 12, 2003

The right to bear arms, sounds somewhat noble, ironic.
posted by johnnyboy at 5:14 AM on June 13, 2003

badzen: I used to be a Libertarian, then I got better.

I know, I'm all snarky lately. Attribute it to unbridled cynicism unleashed by rampant corruption in our public sphere.

On a less snarky note, I used to feel closer to Libertarians than anywhere else. The Republican-Conservative-Right pissed me off by their insistence in religious morality backed by government fiat, and the Democratic-Liberal-Left I used to see as rights-encroaching socialists.

Then I was poor for a while. And then I married someone who'd been really poor a lot longer. It changes your outlook when you realize that you don't get paid for 2 weeks and there's only $30 in the bank. Or when the decision is choose one: pay the rent, pay the electric, eat.

These days I'm better classed as a fundamental rights progressive. I'm still not perfectly happy with the Democrat-Liberal-Left, but better the devil I can work with who's willing to see my side than the Republican-Conservative-Right-wing hell-spawned ideologue who can't see the other side of the table much less an opposing viewpoint.

As for the Libertarians-- well, it sounds good in theory but I don't think I want to live in that world any more. They bring some good points to the discussion, but they're so worried about the encroachment of civil rights by the government that they're turning a complete blind eye to the encroachment of civil rights by corporations. Don't try talking about that with a True Believer, though.

Now back to your regularly scheduled snark.
posted by Cerebus at 5:35 AM on June 13, 2003

they're turning a complete blind eye to the encroachment of civil rights by corporations.

How can a corporation encroach on your civil rights without government as enabler?
posted by ZenMasterThis at 5:42 AM on June 13, 2003

How can a corporation encroach on your civil rights without government as enabler?

The only way government can protect my rights against encroachment by businesses is through regulation. There's no other way out of that conundrum. This was for me an unpleasant realization, as when I had that particular epiphany I had deeply bought into the Libertarian world-view.

Believe me, I spent years looking for a way to preserve the fundamentals of libertarian philosophy while trying to deal with the fact that corporate abuse of rights is as big a threat in today's world as governmental abuse of rights.

A big-L Libertarian government would be the ultimate enabler by this measure. Big-L Libertarians believe that regulation is evil, and can be replaced by liability law. Unfortunately, these self-same Libertarians also believe in tort reform, making it harder to use that liability law to redress grievances.

The small-L libertarian government promoted by the conservative wing of American politics would be an enabler as well, for similar reasons-- they believe in scaling back business regulation, just not as far. They also tend to promote tort reform, with the same result.

So yes, government must act as an enabler. That was my point.
posted by Cerebus at 6:08 AM on June 13, 2003

We could just scrap the limited liability corporation (or at a minimum, reform the decision that made them count as "persons" unto themselves). I say that as a libertarian type - anti-state.com bangs the drum about doing so from a "market anarchist" perspective of the corporation-as-government-creation.

On a more general note, the financial crisis of most states has been going on for years now, and isn't really Bush's fault (nor is it Clinton's, in case you were about to get your hackles up over that). Most states just forgot the story of the ant and the grasshopper. During the good times of the late 90's, they made ridiculous projections about their future tax earnings, and spent based on those. When the inevitable business cycle rolled on into recession (more properly, slower-than-expected growth), they were caught with their pants down. Which president in charge is trivial, albeit Bush hasn't exactly done much in the way of Neo-Keynesian mojo to kickstart things.
posted by Pseudoephedrine at 7:13 AM on June 13, 2003

Pseudo: I would wholeheartedly agree that both corporate limited liability and legal personhood need to be revoked. But this would only make it easier to redress grievences; they do nothing to prevent such behavior in the first place. Regulation is the only way to accomplish that.

As for your second point, Bush is the grasshopper's grasshopper. He frittered away a multi-trillion-dollar surplus that should have been used to service debt on dubious and ultimately ineffectual schemes. No saving for the future there, neh?
posted by Cerebus at 8:26 AM on June 13, 2003

Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend Cut and spend

Have I made myself clear?
posted by troutfishing at 9:41 AM on June 13, 2003

Cerebus - So you're saying the poor aren't undeserving and inferior?

Hmmm. I think I'm going to have to ask you to turn in your International "Saved and Rich Too!" Calvinist Association membership. You're kicked out of the Social-Darwinism Club too, and the American Nazi Party is putting you on their blacklist. George W himself doesn't think you're so hot, either.
posted by troutfishing at 9:46 AM on June 13, 2003

gramcracker: No, my economist friend wasn't an idiot. Medicare and Social Security are based on imaginary budget parameters. Unlike other programs, both are set up with "trust funds", a magnificent boondoggle.
A typical program would be to use 'x' amount of money less "administration" to produce a desired outcome. It would be limited to the original budget allocation, unless it ran short and congress appropriated more money for extra fiscal year funding.
Medicare and SS, however, *initially* receive a budget that will theoretically "pay for" their expenses. This budget is then looted to pay for non-Medicare and SS items, and the actual program receives only what it currently needs to operate. Which means that the vast amount of their "debt" is passed on to the national debt.

In other words, they appear *very* efficient because their budget says that have vast amounts of money that they don't really have. If, however, you just look at the money they *spend* each year, instead of the money they are "given", (*less* the money they never get their hands on, as it consists of direct payments to non-department employee individuals from the Treasury), you will find that "administration" eats up far more than the 3% you quoted.
posted by kablam at 2:21 PM on June 13, 2003

Kablam - thanks for the rundown (I knew the general picture) but then your economist friend's "efficiency law" is particular to Medicare and Social Security alone.

I don't expect to draw on Medicare or on SSI when I'm 80.

Thanks, GW Bush.........fer nothin'
posted by troutfishing at 3:01 PM on June 13, 2003

It's hard to make the case that government is in any way efficient. As soon as a program gets created, they recieve funding, and no politician would cut funding for a program without a big fuss. So at the very least, funding increases.

And government employees know you can't fire them, a) because they can claim it was for political reasons and b) they have extremely powerful unions. The Number 1 and Number 2 all-time top donors to political campaigns are Unions representing public employees. Walk around the hallway of a government building and count the number of people you see sleeping. (And what a racket those unions have going on, taxes --> pay raises --> more union dues --> more campaigning --> more taxes to pay for pay raises).

So tax cuts are the only thing that puts pressure on the government to get smaller instead of always getting a little... bit... bigger. I'm all for them.
posted by MarkO at 3:58 PM on June 13, 2003

MarkO - First of all, your assertion that "no politician would cut funding for a program without a big fuss" is a bit shaky, I would hazard to say.

Further, are you really asserting that cutting taxes - and locking in far larger tax cuts in the future - while at the same time running historic deficits is a wise course of action?

If you do think so, I'd be scared to know the state of your personal finances.

As Paul Krugman detailed, the net effect of these tax cuts will be to reduce federal tax revenue, as a percentage of GNP, to levels below those which held when Medicare and SSI were started as programs.

So: Kiss your Medicare and SSI goodbye. They won't be there. No money to pay for them.

Then add in the cumulative impact of absurdly large yearly federal deficits.

Would you call yourself a "Cut and Spend" Republican?
posted by troutfishing at 4:08 PM on June 13, 2003

Would you call yourself a "Cut and Spend" Republican?

God no. Spending = Stealing. The governmnet's not your father. And so on.
posted by MarkO at 4:26 PM on June 13, 2003

MarkO - So you would cut taxes and cut the deficit too?
posted by troutfishing at 8:40 PM on June 13, 2003

Definitely, trout. Cut taxes, cut spending by even more. Among my list of cuts:

- $87 billion/year in corporate welfare
- That recent $170 billion farm bill (Average farm household net worth: $564,000)
- $20 billion/year in pork barrel spending
- $33 billion/year in payments to deceased or imprisoned persons
- $3 billion/year to Israel (and $2 billion/year to Egypt too)

These guys reccomend cuts totaling $1.27 trillion in 5 years.

And besides all that, you could eliminate the Departments of Agriculture, Commerce, Education, Energy, Housing, and Transportation. That would be a good start.

So cut taxes, cut "services", limit government. Many conservatives share the same view; just not most conservative politicians, who are somehow able to convince the public that you can cut taxes and keep all the programs. After all, if you can't promise more and more money, how are you going to get special interests to contribute to your campaign?
posted by MarkO at 11:10 AM on June 14, 2003

Classic. "Cut everything except defense; fuck the people, I got enough if poor people can't get theirs then they're a waste of oxygen and should die and rot in the street because I won't pay for their pauper's funeral."

You're a laugh riot, MarkO. Why don't you and your ilk go hijack some other country so you can wallow in your own waste without dragging me along with you?

There's enough slop in the defense budget ($380 billion in 2004) to more than pay for all the services you want to cut.

What a way to promote the general welfare, hmmm?
posted by Cerebus at 12:32 PM on June 14, 2003

Classic. "Don't fuck the people, I'm everyone's personal best friend. If I were in power I would be able to use my infinite wisdom to tell everyone how to live, act, and think. Forget the poor people, I'm too busy eating the rich!"

You're a laugh riot, Cerebus. Why don't you and your ilk stop dragging me through your failures in paternalism in THIS country?

"I am for doing good to the poor, but I differ in opinion of the means. I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it. In my youth I travelled much, and I observed in different countries, that the more public provisions were made for the poor the less they provided for themselves, and of course became poorer."
- Benjamin Franklin
posted by MarkO at 7:30 PM on June 14, 2003

Spoken like someone who's never been there, MarkO.

Oh, and by the way-- the whole "take my opponent's words and make a few replacements" isn't a debating technique; but thankfully most people grow out of that stage. Let me know when you do.
posted by Cerebus at 10:25 PM on June 14, 2003

"...is not making them easy in poverty, but leading or driving them out of it."

For example, tax-funded public education, up to and including college. Whoops, MarkO wants that cut. So sorry; you'll be poor and ignorant in MarkO's world, just like those damn poor people deserve. After all, if they were worth anything God would have made the rich like MarkO.

For example, job training, retraining, and financial support while training. Whoops, cut too. Better get used to that minimum wage job, you're going to be there forever. Whoops, I forgot, the minimum wage went with it-- I hope the slave wages are enough to eat with, bucko.

For example, a basic safety net-- not to make it 'easy' to be poor, that's impossible-- but to provide for an actual retirement that employers refuse to provide to their low-wage employees. Whoops, I hope Grandpa likes that slave-wage job at WalMart; he'll be working at it until he dies.

Like affordable universal health care, so that poor people can stay healthy enough to work, so they can get out of the hole (grave) MarkO wants to dig for them. I hope Grandpa doesn't mind dying of a treatable heart condition in the WalMart entrance. Too bad he wasn't working hard enough to be rich so he could afford a doctor.

Without these things how do you lead someone out of poverty? Tax cuts? Pixie dust?

I suppose they could all enlist in the Army and be grist for the perpetual war against Eastasia. Or was it Oceania? Then they can enjoy our society's grateful thanks for their sacrifice in the form of veteran's benefits. Whoops, so sorry, they cut that too.

Civilization is what happens when we stop pretending we're locked in some Darwinian struggle for survival and start thinking in terms of communities and shared futures, to paraphrase Brian Eno. You and your kind, Mr. MarkO, are not civilized. You are barbarians wearing the loot of a civilized society, tearing at the gates of yet another great city; and I for one will do my utmost to drive you away.

Whether you like it or not, you are the beneficiary of this 'paternal' society you denigrate and want to dismantle. You owe this society something back, sir, and you are failing in your obligation.
posted by Cerebus at 10:55 PM on June 14, 2003

Cerberus, I'll let you have the last work here. You're obviously feeling very bitter and think I'm the source of your problems. I must admit that your writing is very eloquent, i just wish you would use it to promote a sensible point of view instead of discredited Marxist dogma.
posted by MarkO at 12:11 AM on June 15, 2003

I was wondering how long it would take for the specter of Marx to come out of your mouth. I may be bitter, but you're so brainwashed by the common agenda of each of the plethora of right-wing 'think-tanks' that you frequent (in each of your links) that you can't even see that Marx has absolutely nothing to do with what I'm on about.

I've read Marx & Engles. And I've read Smith and Locke. How about you?
posted by Cerebus at 6:34 AM on June 15, 2003

MarkO - Well then, you're consistent. You're of the "Norquist School".

But, Marxist Dogma? I see none of that on this thread.

Here's one observation: Adam Smith, a noted social reformer in his time, explicitly noted that the Free Market, of which he wrote in "The Wealth of Nations", could not function fairly (or even optimally) if labour were not granted the same mobility as was afforded capital.

At the time Smith was writing, Britain's poor were largely prevented from moving freely around within that country. Smith (no hypocrite, it seems) fought for freedom of movement.

But Globalization has exaccerbated this basic problem, which has never been addressed at the international level: the world economic system is not, in the view of Adam Smith, either just, equitable or even maximally efficient because workers cannot move about as freely as can investment capital.

So, then, we are really living in "quasi-capitalism" or "capitalism lite", and not the real capitalism of Smith's vision which, for obvious reasons, was an utopian vision -- as, indeed, was Marx's vision.

Das Kapital was more of a critique than program, and did not really spell out how socialism was actually to be implemented, while Adam Smith's full vision could not be implemented because of the social chaos which would erupt were great masses of humanity free to move about around the globe in search of the highest wages.

Both visions then, Smith's and Marx's, were utopian, impossible to really implement, and horrendously distorted to suit various ideological and propaganda purposes.

And so they are to this day.
posted by troutfishing at 8:53 AM on June 15, 2003

trout - Forgive me, but I don't know what the "Norquist School" is. But now I understand why being consistent is so unpopular among Republicans; people like Cerebus attack you and claim that you loathe the poor.

And I'll have to learn more about movement of labor as a necessary component of free markets. I'm all for more open borders, but I don't see that redeeming Smith's utopian vision as you explain it.

Oh and my reference to Marx came in as soon as Cerebus played the "slave wages" card.
posted by MarkO at 9:45 AM on June 15, 2003

OK my mistake. Norquist was the guy from the article. Sorry about the confusion.

While I'm at it, I had a thought--don't wages reflect the amount of capital invested per person, or in other words the productivity of labor? Because if that's the case I would expect capital to go where wages are lowest and bring them up, as it is doing in East Asia.
posted by MarkO at 10:17 AM on June 15, 2003

MarkO - Sure, that does happen to some extent.....it's just a question of the degree. But as that happens, the same process can depress wages if we're talking about, say, moving a factory from one country to another where labour is cheaper.

I think there's a lot of disagreement about the overall effect of Globalization, with some arguing that it amounts to a "race to the bottom", and others insisting that it makes everyone wealthier overall. Personally, I think the jury is still out. I do recall (I hope correctly) that the worldwide trend is towards greater income inequality.

Speaking of which, Barbara Ehrenreich has a great book, "Nickle and dimed" in which she does the "Black like me" bit and tries out the life of a cleaning lady earning close to minimum wage. It's a sobering account - other than the obvious lack of overseers, leg irons, "masters", and so on - the picture is very close to actual slavery. It's pretty grim.

My overall argument for social services is that the playing field is not at all level, and that the wealthy leverage their wealth (sometimes fairly, sometimes not) to achieve competitive advantage (and more wealth).

If everyone entered into life with the same set of circumstances ( nutrition, parental care, education, and so on - excepting DNA), I might be in favour of abolishing the functions of government which you dislike - but I think the current situation is quite the opposite.

Some economists hold this view too - that the structural nature of capitalism is such that inequalities build up over time and that it is the job of government to mitigate this.
posted by troutfishing at 12:39 PM on June 15, 2003

I have tried to answer this quesiton myself, since it's painfully obvious that many people don't get by in this country.

I think one of the more untold benefits of capitalism is the fact that business serves the mass market--that is, productivity increases and the price of goods decrease, making everyone wealthier when wages are held constant. While rich people can buy a Lexus, everyone can buy a working car.

The point is that countless goods and services have been made cheaper and cheaper for the benefit of the poor. But the government meddles in the markets for the essentials. There are tarrifs and subsidies propping up food prices, for the benefit of wealthy farmer, but to the detriment of poor consumers. Education is a government monopoly and has a track record of delivering poor quality. Perhaps competition for education would bring prices down. I'm trying to get the figures together, but health care costs used to be quite low until Medicaire and other government plans got into the game (not to mention greedy malpractice lawyers). And housing is constantly interfered with, whether it's rent control, public housing, or measures to prevent "urban sprawl".

So of course there will always be inequalities, but that doesn't mean people at the bottom necessarily have to face such dire conditions. You could argue that a"social safety net" helps mitigate destabilizing changes for the poor, and I'd agree to an extent.

But if history has shown that interventionism doesn't work, how about trying to limit government's role and see what happens?
posted by MarkO at 2:03 PM on June 15, 2003

... productivity increases and the price of goods decrease, making everyone wealthier when wages are held constant.

But wages aren't held constant in a free market; as productivity increases, employers can reduce headcount without penalizing output. This results in a downward pressure on wages. You can see this now in the white collar world, where the unemployment rate-- while still half the national overage-- has doubled in the last three years. The same thing happened to blue collar jobs in the 80's. Coincidence?

Remember, capitalism is just a pricing scheme; when productivity goes up, the employer can choose to reduce prices, or retain the price and keep more profit.

I, personally, know plenty of people who can't afford a working car.

The point is that countless goods and services have been made cheaper and cheaper for the benefit of the poor.

Have they really? 40 years ago, a family of two parents and children had a single wage earner. Today, that same family needs two wage earners to keep the same standard of living-- and even that is slipping.

Education is a government monopoly and has a track record of delivering poor quality.

This is a myth. Prove your assertion.

[...] health care costs used to be quite low until medicare and other government plans got into the game [...]

And access to that care was far, far more restricted than today. When you got sick, you didn't go to the doctor, you just coped. Costs today have more to do with the explosion in biotech-- new drugs, new treatments, new technology that weren't available in 1960, and more people desiring these services-- than they do with Medicare/Medicaid.

[...] (not to mention greedy malpractice lawyers).

Myth. While insurance costs have increased I'll warrant this has more to do with insurance companies holding doctors hostage (since you can't practice without insurance) than actual lawsuit costs.

So of course there will always be inequalities, but that doesn't mean people at the bottom necessarily have to face such dire conditions. You could argue that a"social safety net" helps mitigate destabilizing changes for the poor,

I'm glad you agree with me.

But if history has shown that interventionism doesn't work, how about trying to limit government's role and see what happens?


1) History has shown that interventionism does work, mostly. The middle class has grown by leaps and bounds since the 1930s; everyone actually did grow richer overall; and there was a marked closing of the gap between the rich and the poor. It's not a perfect record, and I wouldn't expect it to be; these are complex and difficult to understand issues. But it makes more sense to fix the shortcomings than dump it and start over.


2) History has shown that non-interventionism doesn't work, and you would do well to read it. I would point specifically to the period from 1850 to 1930 or thereabouts. The abuses of the 'Gilded Age' would chill your heart; as bad as it is today, we aren't having labor riots and popular armed rebellion, or veterans marching on Washington, or factory owners hiring thugs to kill organizers. But we could be, very very quickly. All we need is more of what you're offering.
posted by Cerebus at 4:53 PM on June 15, 2003

MarkO - Cerebus said pretty much all that I would have ( with different words, with a different tone ) except for Fordism, which I feel might be a key term missing here.

But thanks for sticking with the discussion.
posted by troutfishing at 10:10 PM on June 16, 2003

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