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Sunday
Nov292009

Why All The Class Envy? Richard Weaver Explains

"The tendency to look with suspicion upon excellence, both intellectual and moral, as "undemocratic" shows no sign of diminishing."--Richard Weaver, Ideas Have Consequences

During the CNN sponsored debate of the 2008 presidential campaign, then candidate Obama assured lower and middle class Americans that his taxing plans had nothing to do with them:

"...if you make less than a quarter million dollars a year, then you will not see your income tax go up, your capital gains tax go up, your payroll tax. Not one dime."

Obama made this promise several times on the trail, acknowledging that while 95 percent of Americans would not see a tax increase, the minority five percent would. After all, rich people could afford a "modest" tax increase, Obama assured Americans, especially if the money went to worthy social services.

Throughout the campaign Senator McCain never effectively challenged Obama's anti-rich worldview. As a disciple of Teddy Roosevelt, McCain was in no position to argue against a more progressive tax on capital.

Given that Obama's assumptions were never really disputed, it's reasonable now to at least ask a couple of questions: How did we come to believe the rich are responsible for our personal welfare? And how did we get to the point where we are so dominated by class envy?

To answer these questions, we look to the late Richard Weaver, University of Chicago English professor and author of the controversial Ideas Have Consequences, published in 1948. In Ideas Weaver condemned the replacement of transcendental values that led to "the loss of those things which are essential to the life of civility and culture."(1) Weaver believed the worship of speed and mass cultivated a modern man who, having descended into the comforts of urban life, found himself believing he no longer must toil for prosperity because "the world owes him a living." (2)

As real life sets in, according to Weaver, the modern man is shocked to learn that "science has not exempted (him) from struggle in life."(3) Instead of turning to hard work and discipline to improve his lot, the modern man looks to the politician:

"Demagogic leaders have told the common man that he is entitled to much more than he is getting: they have not told him the less pleasant truth that, unless there is to be expropriation--which in any case is only a temporary resource--the increase must come out of greater productivity. Now all productivity requires discipline and subordination; the simple endurance of toil requires control of passing desire."(4)

Instead of increasing productivity to address growing consumptive needs, the masses turn against the capital-rich boogeyman and force him--through the coercive powers of government--to fund their pleasures.

"What happens finally is that socialism, whose goal is materialism, meets the condition by turning authoritarian; that is to say, it is willing to institute control by dictation in order to raise living standards and not disappoint the consumptive soul."(5)

The wealthy then become a source of funding as well as a scapegoat:

Regularly in the day of social disintegration there occur systematic attacks upon capital. Though capital may, on the one hand, be the result of unproductive activity--or of "theft," as left-wingers might declare--on the other hand, it may be the fruit of industry and foresight, of self-denial, or of some superiority of gifts. The attack upon capital is not necessarily an attack upon inequity. In the times which we describe it is likely to be born of love of ease, detestation of discipline, contempt for the past; for, after all, an accumulation of capital represents an extension of past effort into the present. But self-pampering, present-minded modern man looks neither before nor after; he marks inequalities of condition and, forbidden by his dogmas to admit inequalities of merit, moves to obliterate them. The outcry comes masked as an assertion that property rights should not be allowed to stand in the way of human rights, which would be well enough if human rights had not been divorced from duties. But as it is, the mass simply decides that it can get something without submitting to the discipline of work and proceeds to dispossess. Sir Flanders Petrie has written: 'When democracy has attained full power, the majority without capital necessarily eat up the capital of the minority, and the civilization steadily decays.' "(6)

This may sound apocalyptic, but in the end Weaver fought strongly against the idea that "we can't turn back the clock." His book while a treatise against a declining culture, was simultaneously a call for revival. Weaver believed that Americans can return to the idea of objective and transcendental truth, and he left no doubt as to the importance of this outcome:

"The issue ultimately is whether there is a source of truth higher than, and independent of, man; and the answer to the question is decisive for one's view of the nature and destiny of humankind."(7)

(1) Richard Weaver, Ideas Have Consequences (Chicago: University of Chicago Press, 1984), vi.(2) Weaver, 116.(3) Weaver, 124.(4) Weaver, 125.(5) Weaver, 125.(6) Weaver, 126-127.(7) Weaver, 3.

Sunday
Nov222009

Behold, Inflation Cometh

Over at the The New York Times the editors are running a series of articles called “The Debt Bomb”.  According to the Times the series examines “the consequences of, and attempts to deal with, growing public and private debts.”  With the national debt at over $12 trillion, interest set to equal $500 billion a year, and 1.6 trillion in short term loans due by 31 March, the Times notes “there is little doubt that the United States’ long-term budget crisis is becoming too big to postpone.”

To address the crisis, the latest article raises four possible solutions.

            1.  Raise taxes/cut services

            2.  Default

            3.  Growth

            4.  Inflation

If these are in fact the only ways to prevent the debt bomb from exploding, then count on inflation to win the day.  Here’s why:

The first option, raising taxes/cutting services carries with it many political difficulties.  First, President Obama repeatedly promised not to raise taxes on individuals with income less than $200 thousand and households with income less than $250 thousand.  To reverse that promise would be political seppuku.  Second, as David Wessel at the Wall Street Journal has noted, even using White House estimates, the next ten years will see a $9 trillion deficit.  For “the rich” to cover that amount, the government would have to tax “the rich” at nearly 70% of income.

To cut spending would be likewise difficult.  Americans have grown used to government largesse, and the bulk of government spending is tied up in mandated social programs—such as Medicare and Social Security.  Reforming these programs would require political capital President Obama does not appear to possess

The second option, defaulting on our loans, is not really an option at all.  If the United States decided to forgive its own debt, the harm that decision would do to the nations holding our debt, as the Times notes, would cause a worldwide economic panic.

The third option is to hope the economy turns around and tax revenues increase.  The economy may very well come back to life, but even the economists who predict a rebound believe a recovery will be slow to materialize.

Which brings us to the final option, inflation. Looking at the four options objectively, it seems rational to expect our government will eventually resort to inflation.  Inflation has the ability to surreptitiously lower the national debt while avoiding the political damage of raising taxes and cutting spending.  “Inflation,” according to Thomas Sowell, “is in effect a hidden tax.  The money that people have saved is robbed of part of its purchasing power, which is quietly transferred to the government that issues new money.”[i]

The fear of inflation, according to Sowell, is not irrational:  "...governments of all types—from monarchies to democracies to dictatorships—have resorted to inflation, as a means of getting more wealth without having to directly confront the public with higher taxes.”[ii]

As we watch the government attempt to tackle the debt, don’t expect to see the Administration making tough decisions and advocating bold, budget-tightening reforms.  Don’t expect to see your taxes rise either (unless you are unfortunate enough to be “rich”). Instead, expect to be paying the debt yourself with the falling value of your money—the money you earned through hard work, investment, and making prudent decisions.  Too bad the government didn't follow your lead.

 


[i] Thomas Sowell, Basic Economics, (New York:  Basic Books, 2004) 262.

[ii] Sowell, 261

Friday
Nov132009

Thomas Jefferson on Congressional Overreaching

Of course Thomas Jefferson needs no introduction—our third president, author of the Declaration of Independence, and leading founding father. In the following passage are Jefferson’s thoughts on the creation of a national bank. I think his thoughts are particularly instructive as we think today about the impending healthcare legislation in Congress with its public option, its new taxes, and the threat of jail or fines for people who do not purchase insurance. Because as is clear, Jefferson is writing more about the proper role of Congress than he is any particular policy.

“I consider the foundation of the Constitution as laid on this ground: That " all powers not delegated to the United States, by the Constitution, nor prohibited by it to the States, are reserved to the States or to the people." [10th amendment.] To take a single step beyond the boundaries thus specially drawn around the powers of Congress, is to take possession of a boundless field of power, no longer susceptible of any definition.

The incorporation of a bank, and the powers assumed by this bill, have not, in my opinion, been delegated to the United States, by the Constitution…

… To lay taxes to provide for the general welfare of the United States, that is to say, "to lay taxes for the purpose of providing for the general welfare." For the laying of taxes is the power, and the general welfare the purpose for which the power is to be exercised. They are not to lay taxes ad libitum for any purpose they please; but only to pay the debts or provide for the welfare of the Union. In like manner, they are not to do anything they please to provide for the general welfare, but only to lay taxes for that purpose. To consider the latter phrase, not as describing the purpose of the first, but as giving a distinct and independent power to do any act they please, which might be for the good of the Union, would render all the preceding and subsequent enumerations of power completely useless.

It would reduce the whole instrument to a single phrase, that of instituting a Congress with power to do whatever would be for the good of the United States; and, as they would be the sole judges of the good or evil, it would be also a power to do whatever evil they please.”[i]

Substitute “current healthcare legislation” for “national bank” and Jefferson would today be the leading voice against the current healthcare bill.


[i] The Writings of Thomas Jefferson "Memorial Edition." Vol. 3 p. 146.

Sunday
Nov082009

Bigger Than Healthcare

Despite President Obama’s early popularity and his wide margin of victory, he has had much difficulty enacting the agenda on which he campaigned.  The late economist Joseph Schumpeter may have an explanation.

In Schumpeter’s Capitalism Socialism and Democracy (1), Schumpeter predicts capitalism will fall victim to its success and slowly be replaced by socialism.  A smooth transition to socialism, however, according to Schumpeter, is contingent upon timing.  Should extraordinary circumstances propel socialists into power before people and industry are ready, the transition may be hampered by the temptation to prematurely adopt socialist policy:

“(The premature adoption of the principle of socialism) may be defined as transition from the capitalist to the socialist order occurring at a time when it has become possible for socialists to gain control of the central organs of the capitalist state while nevertheless both things and souls are as yet unprepared . . .”

If socialism is prematurely adopted, citizens “as yet unprepared” who still believe in individualism will be capable of resisting the socialist ideal and refusing cooperation.  This resistance may inhibit the rapid creation of the socialist order.  The socialist in the meantime can look for short-term situations to help advance his agenda.

“The long-run situation becomes more and more favorable to socialist ambitions.  It is still more important that short-run situations may occur . . . in which temporary paralysis of the capitalist strata and their organs offers tempting opportunities.”

Or, in other words, as the President’s Chief of Staff Rahm Emmanuel likes to say:  “You never want a serious crisis to go to waste.”

Emmanuel and President Obama have seized upon the economic downturn to advance the socialist agenda, but the American people are not yet ready to blame the bourgeoisie for their ills. The anti-capitalist logic of the Obama Administration has not been enough to convince the American people to entrust their liberties to the state.

Much like during the Great Depression when:

“Souls were still more unprepared than things…; for (Americans) the conception of socialization and even of much less than this was still “un-American”…  (Americans) honestly felt that what they were doing nobody, least of all the state, could do as well and that in resisting they were fighting not for their interest only but also for the common good—for the absolute light against absolute darkness.”

A woman at a September rally in New York holding the sign:  “The State does not own my body” is likely thinking in similar terms.

There is some good news for the socialist who finds his agenda waning, however. To ensure the progression of the socialist ideal, the socialist can enact a handful of measures without difficulty.  Two of them—given the first year of Democratic control of government—are worth noting here:

“The first thing which must be done is to bring about inflation.  The banks must be seized and combined or coordinated with the treasury, and the board or ministry must create deposits and banknotes using traditional methods as much as possible… For, as Lenin has pointed out, nothing disorganizes like inflation:   ‘in order to destroy bourgeois society you must debauch its money.’ ” 226

“Second, the insurance business is an old candidate for nationalization and has to a large extent become mechanized by now.  Integration with at least some of the branches of social insurance may prove feasible:  selling costs of policies could be considerably reduced and socialists might again rejoice in the access of power that control over the funds of insurance companies would give to the state.”

All this is to say that recent actions by the federal government are bigger than straightforward policy votes.  Excessive borrowing and inflationary spending are not simply about stimulating our economy.  Health care “reform” is not simply about expanding access.  Both are government power grabs that represent further socialization of our country. 

We must resist these efforts, not only because we dislike particular policies, but because we recognize the creeping nature of the socialist agenda.  We must resist any efforts that undermine the first principles of our founding fathers--principles that made our country strong, our industry prosperous, and our people free.  Otherwise, we will find ourselves overcome by the socialist agenda and maneuvered into a system that will weaken and damage our national existence.

(1) See Joseph A. Schumpeter, Capitalism, Socialism and Democracy, (New York:  Harper Perennial, 1976), 223-230.

Wednesday
Oct282009

Obama, Caesar, and Politician Authors

Here are two quotes—their relation will be obvious. The first is from NEA Chairman Rocco Landesman from a speech he gave last week. The second is from Russell Kirk in The Conservative Mind. Kirk (1918-1994) was a political theorist and preeminent American conservative.

"This is the first president that actually writes his own books since Teddy Roosevelt and arguably the first to write them really well since Lincoln. If you accept the premise, and I do, that the United States is the most powerful country in the world, then Barack Obama is the most powerful writer since Julius Caesar."

- Rocco Landesman, “We Know Art Works.” National Endowment for the Arts. Oct 21, 2009. http://www.arts.gov/artworks/?p=13.

"As the power of centralized government increases, political leaders—immersed in administrative duties of increasing complexity and bound to ceremonial duties—have less time for reflection. The last American president to do his own thinking was Herbert Hoover; the last British prime minister of intellectual distinction was Arthur Balfour. So it is that when one discusses social thought in recent decades one rarely turns to those who occupy high political office: the ideas expressed by those men are put into their heads by others, and their very words ordinarily come from the typewriters of anonymous or quasi-anonymous members of their staffs—who, in turn, often echo the phrases of influential publicists or scholars."

- Russell Kirk, The Conservative Mind, Seventh Revised Edition, (Washington, DC: Regnery, 2001) 475.  

The enormous reach by Landesman has been well ridiculed, as have the inaccuracies in his statement (Lincoln wrote brilliantly, but never published a book). The statement is hyperbolic and partisan. But there is a larger point here that is important.

Books published by prominent politicians are usually ghost-written, vain, and often terrible. To his credit, Obama is a talented writer and his two memoirs are much better products than are usually put out by politicians. For Kirk, though, modern politicians have a low ceiling as writers because they are simply too occupied in the administrative duties of big government to have time to reflect and write an excellent product. As such, they rely on superficial, self-serving content and let others to do the actual writing.

Obama is likely the best writer to occupy the White House in several terms. But that does not warrant catapulting him to the top of two thousand years of literature.