Kennedyland became Scott Brown Country on Tuesday, but across the border in New York, where I live, it was business as usual.
Gov. David Paterson proposed a billion dollars in new sales taxes. The state has blown through all the money it has taken out of our pockets in recent years and now needs more. Each fiscal cycle brings a raft of new taxes or tax hikes: school taxes, municipal taxes, county taxes, state taxes. Last year a “commuter” tax was promulgated in Albany. I don’t commute, but I have to pay it anyway. “It’s really not that much money,” the apparatchik on the phone told my wife.
In the midst of a slump, Governor Paterson proposes to hire hundreds of new auditors for the revenue squad. Tax collection: New York’s growth industry. It’s made the state the second-most highly taxed jurisdiction in the nation. New Jersey wins that race, but the Empire State is still proof positive that the Sozialstaat, like the Roman excise taxes Gibbon deplored, is a weed that, if unchecked, will eventually darken the world with its deadly shade.
What New York is, America will one day be. The math isn’t complicated. Overall government spending in the United States, which accounted for less than 7 percent of the gross domestic product in 1903, was estimated in 2009 to account for more than 45 percent of GDP. That’s a lot of commuter tax.
The voters who sent Scott Brown to the Senate saw the future, and they didn’t think it worked. The classic image of the campaign — the guy riding around in his pickup under silver-and-pewter Massachusetts skies, sounding the alarm “to every Middlesex village and farm” — didn’t hearken back to late-19th-century populism, with its faith in the state’s power to right social wrongs, or to antebellum nativist populism, which blamed the newcomer and the stranger.
Brown instead took us back to the Paul Revere populism of the Revolution, when patriots galloped around insisting that it wasn’t fair that one class of English subjects (those in America) should be treated differently from another (those in England).
The Massachusetts Miracle video made the connection. Brown called for a level playing field and an end to the (rigged) machine. Look at what Wall Street, that erstwhile bastion of free enterprise, has become in the last quarter century. In her important new book After the Fall, Manhattan Institute scholar Nicole Gelinas shows that Washington’s too-big-to-fail policy has in effect socialized big banks by insulating them (as social policies will) from the market.
Martha Coakley’s internal polling suggested that many in Massachusetts think that “Washington prioritizes Wall Street over Main Street.” It’s not surprising. Small businesses tank. Big ones don’t. With the emergence of the social-financial nexus, the favored few make more money than ever, and your tax dollars help them do it.
Many Massachusetts voters distrust the health-care bill for the same reason they are skeptical of Wall Street’s hyper-profits. “One key to Brown’s victory,” according to Rasmussen’s election-night poll, is that 41 percent of Massachusetts voters “‘strongly opposed’ the [health] plan while just 25 percent ‘strongly favored’ it.”
Brown voters look on health-care reform as yet another excuse for an extension of the favoritocracy. You get bumped up to business or first class if you live in Nebraska, or if you belong to the right union, or if you know Rahm Emanuel. Brown voters do not, I think, want to penalize legitimate success — their own or anyone else’s. President Obama’s calls for vengeance taxes on the well-to-do failed to stir them. Brown voters aren’t fed up with people’s making it. They’re fed up with the government’s helping a connected elite to make it.
While ordinary people struggle, Wall Street revels in subsidized profits, and public-sector mandarins have never been more prosperous. The average salary of federal workers rose in 2009 to $71,206, not counting bonuses, overtime, and benefits; the senior managers, who constitute 19 percent of the civil service, on average received salaries of more than $100,000. The average private-sector wage in 2009 was $40,331. The federal civilian workforce, the Cato Institute’s Chris Edwards observes, “has become an elite island of secure and highly paid workers, separated from the ocean of private-sector American workers who must compete in today’s dynamic economy.”
That’s why the JFK tax-cut video resonated. Jack, not Ted, is the Kennedy I’m emulating, Brown said. He portrayed himself as the candidate who wouldn’t take even more of your money away from you to fund the favoritocracy.
On election night, Andrew Sullivan caricatured the Brown vote as an expression of the “Angry White Guy Factor.” But the frustration the election revealed is more principled than that. The social state, ostensibly a neutral umpire in the regulation of capital and labor markets, has turned the big players in these markets into a pampered praetorian guard. The union centurions deliver the votes, and the Wall Street captains deliver the dough. According to the Center for Responsive Politics, of the top five contributors, between 2005 and 2009, to the campaign committee of Max Baucus, chairman of the Senate Finance Committee, two (Goldman Sachs and Kohlberg Kravis Roberts) were financial firms and one (AIG) was active in the credit-default-swap market. The top four contributors to Barney Frank’s campaign committee in 2007–2008 were financial institutions. Chris Dodd’s biggest donor in the same period was Citigroup.
It is a familiar technique of the centralizing, imperial state to buy off groups that might challenge its dominion. So Louis XIV did when he brought the great nobles of the kingdom to Versailles and made them his cup-bearers and grooms of the chamber; so the British did when they pensioned off the sovereign maharajas of India.
Scott Brown won on Tuesday because more and more Americans want their public servants to scale back America’s version of the ancien régime palace of privilege. They want to retain a larger share of the fruits of their own industry. The votes that elected Brown are not an expression of mad-white-guy sentiment, or of the sort of populist rage for a secular savior that raised up William Jennings Bryan; they are a fresh manifestation of the primal American craving for mere fairness, and for an end to the corrupt politics of favoritocracies.
– Michael Knox Beran is a contributing editor of City Journal. His most recent book is Forge of Empires 1861–1871: Three Revolutionary Statesmen and the World They Made.