Admirers and detractors of the United States agree on one point: This country is unusually resistant to the social consensus and set of structures broadly known as “social democracy” or “progressivism.” (Social democracy leans more toward state ownership, progressivism toward state regulation.) Various versions of such schemes have prevailed in Western Europe and Japan, and to a lesser degree in Britain, Canada, and Australia. The characteristics include a wider scope and role for the state, centralization of decision-making in a national bureaucracy, monopolization of power by a set of large institutions, including state-champion corporations and labor unions, and a wide variety of social entitlements for all citizens. This was the classic progressive economic program; since the 1960s, it has also included certain social characteristics, such as official multiculturalism.
Most of these measures were characteristic of some parts of Continental Western Europe from the late 19th century onward, and became generally prevalent there after the Second World War. The English-speaking countries lagged well behind; Britain began to adopt welfarist policies and admit labor unions to the domestic power system before the First World War, but moved to full entitlement systems and substantial state control of the economy only after 1945. Australia and New Zealand adopted entitlement systems early, using their agricultural and mineral export earnings as petro-states now use oil wealth, but remained socially conservative in many other ways. Canada was essentially similar to the U.S. in its domestic systems (despite some greater public ownership, mostly in transportation) until the 1960s. But by the end of the 1970s, America stood virtually alone in a world of seemingly universal consensus for a strong managerial state.
Optimistic progressives pointed to the accomplishments of the New Deal and the Great Society as evidence that the U.S. could and eventually would achieve their full agenda. Social Security was, after all, a universal welfare entitlement, even if it had to be disguised as insurance; Medicare was the seed of a socialized medical system. Many of the eastern and West Coast states had gone farther with the progressive agenda than the country at large. They were the richer and better-educated parts of the country, and were therefore beacons of the future.
Such a picture was credible through the end of the Great Society, and even through the Nixon administration. In fact, it was possible to see Nixon as the conservative rationalizer of the welfare state, the man who said, “We are all Keynesians now,” who imposed wage and price controls, and who created the regulation-extending Environmental Protection Agency. Any non-progressive features of his administration could be dismissed as electoral pandering to the rednecks, to be undone when genuine progressives returned to power.
And in 1976 it did appear that such an administration was at hand, with the election of James Earl Carter. When Carter gained the presidency over a wounded Republican party, he mistook his narrow victory for a mandate to continue moving along the track toward a European-style social democracy, building on Johnson’s and Nixon’s enhancements of centralized power. In this he was basically following the trajectory of Britain and Canada. Carter envisioned moving toward fully government-controlled medicine, a government-dominated energy sector enforcing strict rationing, and a federally dominated school system promoting governing-class values. In order to carry out his agenda, he created and entrenched two new cabinet bureaucracies, the Departments of Energy and of Education, and a wide variety of new pork and entitlement programs, such as the Comprehensive Education and Training Act and an expansion of the scandal-plagued Community Development Corporations.
Yet by the (unexpectedly hastened) end of his administration, these plans were in ruins. Most of the expansions of power he had envisioned had been forestalled or greatly circumscribed; the nation was engaging in widespread civil disobedience against measures such as the 55-mph national speed limit; and, to the surprise and horror of those who followed the prevailing intellectual consensus, Ronald Reagan had been chosen to take Carter’s place. Although it wasn’t fully appreciated at the time, Reagan’s replacement of Carter marked a critical point (not the first, in fact, but the first generally noticed) of a great U-turn in American politics and society.
For decades — at a minimum, since the beginning of the Progressive Era, and arguably earlier — America had been on a course toward a more centralized society, one in which individualism as it had been understood since before the Founding — a society built on independent families living on their own properties, most of them farms — was being replaced by a different vision. The progressive vision was one of citizens as employees whose existence was mediated by negotiations among large corporations, unions, and government agencies. For such subjects, “rights” were to be a designated set of entitlements granted by those organizations.
America had gone some distance down this road by 1980, although not as far as Canada or Britain, and nowhere near as far as Germany or France, which had never been all that laissez-faire in the first place. But 1980 marked the point at which the nation reversed course. Thenceforth it would be headed in the opposite direction, toward a new vision of individualism and decentralism, driven by the computer rather than the plow.
It was the defeat and frustration of the Carter administration’s plans that made the U-turn, which would be long in unfolding, visible to perceptive observers. By objective standards, Reagan’s domestic program was quite moderate and constrained, not really dismantling any major parts of the federal machine but merely slowing the rate of increase of federal non-defense spending. Reagan devoted the bulk of his attention to foreign affairs and to implementing his principal insight: He understood that one period of sustained pressure would be sufficient to cause the Soviet empire to collapse without a shot being fired, and he applied that pressure with the intended result.