The entitlement state imbalances budgets and enervates citizens
Imagine a foreign visitor who has learned just one fact about America: For the past century our politics has been defined by a contest between two movements, one intermittently calling itself “progressive” and the other more consistently calling itself “conservative.” He would rightly conclude from those labels that partisans of the two movements agree that the arc of history bends toward progressivism and away from conservatism. Progressives, that is, believe they have history’s wind in their sails. They constitute, in that sense, the party of the future. Conservatives, on the other hand, are committed to the stewardship and transmission of a legacy that is both vulnerable, thereby requiring conservation, and valuable, thereby deserving it. Conservatives thus constitute the party of the past.
Progressives are animated, in the late Richard Rorty’s words, by “the hope that life will eventually be freer, less cruel, more leisured, richer in goods and experiences, not just for our descendants but for everyone’s descendants.” Progressives of a century ago believed that progress meant movement toward a known destination, and that the ways to effect it were demonstrable. In the 1930s, around the time they began calling themselves “liberals,” progressives abandoned the conceit that social sciences could, in Condorcet’s phrase, “foresee the progress of humankind, direct it, and accelerate it” in the way the natural sciences understand physical laws and thereby direct and accelerate material progress. But their optimism is undiminished. They continue to believe in “the evolving standards of decency that mark the progress of a maturing society,” as Chief Justice Earl Warren wrote in a 1958 Supreme Court opinion, even if they deny the possibility of formulating criteria whereby we could know that our standards are improving, not just changing.
Conservatism, by contrast, lends itself to wariness. Samuel Johnson’s rule that “men more frequently require to be reminded than informed” comports with the conservative inclination to believe that old wisdom is plentiful while new wisdom is scarce and suspect. What disheartens is the need to remind the same people of the same things, over and over, entreating them not to squander legacies hard won and repeatedly vindicated. Thomas Sowell once wrote that much of modern social history “has involved replacing what worked with what sounded good.” Or, as William F. Buckley Jr. lamented in National Review’s first issue in 1955: “Instead of covetously consolidating its premises, the United States seems tormented by its tradition of fixed postulates having to do with the meaning of existence, with the relationship of the state to the individual, of the individual to his neighbor, so clearly enunciated in the enabling documents of our Republic.”
In the same publisher’s statement, Buckley famously declared that National Review “stands athwart history, yelling Stop.” He remarked further on the challenge of living in “a world dominated by the jubilant single-mindedness of the practicing Communist, with his inside track to History.” A third of a century later that track turned out to lead to the collapse of one of the hardest despotisms human beings have ever endured. Sometimes if you yell “Stop,” history obeys.
And sometimes it doesn’t. The issue of National Review published immediately after the 2012 election declared that contest to have been a “terrible defeat,” “debacle,” and “catastrophe” for conservatism. In a world where Soviet Communism has been consigned to the dustbin of history, such judgments might sound excessive. Since the end of the Cold War, conservatives have warned against the “Swedenization” of America. These warnings are, most directly, about a policy regime wherein government spending accounts for more than half of gross domestic product and government regulation is the biggest factor affecting the generation of the rest.
Data from the Organisation for Economic Co-operation and Development show that, in 2010, all government spending in Sweden equaled 53 percent of GDP. The same figure was 55 percent in Finland, 56 percent in France, and 58 percent in Denmark. Sweden’s comparative austerity suggests that vigilance against the “Denmarkation of America” would be more apposite. Federal-, state-, and local-government expenditures in 2010 amounted to 42 percent of America’s GDP, which means that we’re behind Europe, but not that far behind. Moreover, we’re catching up: In 2000, government spending in the U.S. accounted for 34 percent of GDP.
Well, what are a few percentage points of GDP among friends? By this rudimentary measure of government outlays as a proportion of national income, America already differs from Scandinavia in degree rather than in kind. If conservatives want to avert the Swedenization of America, they need to explain, more comprehensively than they have done so far, the deplorability of that outcome, since Western European social democracy appears benign where Eastern European Communism was manifestly grotesque.
That polemical mission can be pursued by way of two arguments — one sweeping, the other restricted. Swedenization could be bad because it’s bad for human beings, or just because it’s bad for Americans. If the former, then America should reject social democracy as a regime that would debilitate any nation. If the latter, then social democracy might work well enough in some countries, but Americans should reject it as irreconcilable with their republic’s distinctive character.
Most of the conservative case to date has inclined to the larger, categorical contention that the growth of government spending, and of government generally, must anywhere lead to insolvency. “To assure every entrepreneur and every job creator that their investments in America will not vanish as have those in Greece, we will cut the deficit and put America on track to a balanced budget,” Mitt Romney said in his speech at the Republican convention. It is at least arguable, however, that the economic calamities in southern Europe tell us more about how cultures of corruption exploited a lunatic experiment in multinational currency than about the essential qualities of social democracy. In 2010, Sweden’s government revenues were 99 percent of government spending, Denmark’s equaled 95 percent, and France’s were 87 percent, meaning that those countries’ big spenders were also big taxers. Politicians win power there by persuading citizens that, while generous government benefits will indeed require high taxes, they’ll be better off with that combination than with the alternative: keeping more of their earnings in exchange for the government’s curtailing benefits.
In America, by contrast, government revenues equaled 75 percent of outlays in 2010, meaning that federal, state, and local governments borrowed one dollar for every three they summoned the language and courage to raise by taxation. Northern Europe, in other words, finances big welfare states with heavy taxes and little borrowing, while the U.S. finances a smaller one with lighter taxes and extensive borrowing. That difference supports the narrower contention that Swedenization is un-American but not necessarily untenable in any polity. Our deeply rooted, don’t-tread-on-me Jeffersonianism means that we cannot be persuaded to buy even a relatively modest welfare state unless a significant portion of the purchase is financed with debt. In this we are unlike the Europeans, who want cradle-to-grave welfare states enough to pay cash for them.
There are good reasons to believe, even after November 2012, that Americans are indeed not Europeans, and will be more receptive to revising existing social-welfare programs and resisting new ones than to massive tax increases. The fact that victorious Democrats still dare not seek even one dollar in additional federal taxes from anyone below the 98th percentile of the income distribution — though everyone understands that big spending cuts will eventually be inescapable without such increases — is the strongest evidence that America remains, in this respect, exceptional.
Big differences among nations can become smaller, however, and seemingly durable ones can crumble. It is telling that Republicans have been no bolder or more successful in reducing government by leveraging Americans’ aversion to taxation than Democrats have been in raising taxes by leveraging Americans’ aversion to austerity. As Molly Michelmore, a historian at Washington and Lee University, argues in the new book Tax and Spend, the “consequences of a liberal consensus that promised the cost-free expansion of the activist state and a conservative counterrevolution that promised its cost-free contraction has been a political and ideological stalemate.”
Stalemates usually resolve in one direction or the other. The 2012 elections don’t prove, but do suggest, the resolution will be on liberal terms. On Election Day, Californians approved a ballot proposition increasing taxes, despite abundant evidence that the state’s public sector had been falling well short of getting the most bang for the mountain of bucks already at its disposal. Most of the increase was in the income taxes on affluent Californians, along the lines of what Democrats have won at the national level. The top bracket, on taxable income above $1 million, will increase from 10.3 percent to 13.3 percent. Three new brackets will also increase income-tax rates on Californians making between $250,000 and $1 million. In the wake of the fiscal-cliff resolution in Congress, this means that Californian families with taxable incomes above $450,000 (and individuals making more than $400,000) will face combined federal and state marginal income-tax rates above 50 percent. Arguments that such increases will make the state’s finances more unstable — both because rich Californians may choose to reside and do business in other states rather than be taxed at that level, and because heavy reliance on top-bracket income taxes means state revenues will soar and plummet over the course of the business cycle — were unavailing. Moreover, the tax increase, approved with more than 55 percent of the popular vote, cannot be interpreted simply as an act of redistributive zeal. The state sales tax, already the highest in the nation at 7.25 percent, will be increased to 7.5 percent as a result of the ballot proposition.
Finally, as a result of the 2012 elections, more than two-thirds of the members of each house of California’s state legislature will be Democrats. Thus, the high wall erected in 1978 by Proposition 13, which requires a supermajority to raise taxes, can now be breached without a single Republican vote. California, home to one-eighth of the U.S. population, is the birthplace of the national tax revolt, triggered by the passage of that ballot proposition almost 35 years ago. If Americans in general continue to become more like Californians, and if Californians are becoming more like Swedes in their desire for activist government and their willingness to pay for it, then 2012 will be remembered as the beginning of the national tax capitulation.
Such a development argues that we are becoming Swedenized in a deeper sense: not just adopting social-democratic policies but acquiring a sociological character that will leave us resembling present-day Europe more than the America Tocqueville discovered, in which families, communities, and churches turned individualism from a social solvent into a social adhesive. In a 2009 lecture at the American Enterprise Institute, where he is a resident scholar, Charles Murray made the connection between governance and sociology this way: “Almost anything that government does in social policy can be characterized as taking some of the trouble out of things.” The problem, according to Murray, is that “every time the government takes some of the trouble out of performing the functions of family, community, vocation, and faith, it also strips those institutions of some of their vitality — it drains some of the life from them.”
In I Am the Change, an analysis of President Obama’s political philosophy, Claremont McKenna government professor Charles Kesler says the “First Law of Big Government” is that “the more power we give government, the more rights it will give us.” The “rights” in that bargain are really wants, such as the “right” to “rest, recreation, and adventure” promised by one New Deal board, or the “right” to “enjoy the arts and to share in scientific advancement and its benefits,” one of dozens enumerated in the Universal Declaration of Human Rights. Kesler’s formulation speaks to Americans’ inner Jeffersonianism, challenging them to covetously consolidate those genuine inalienable rights with which they have been endowed by their Creator. Tell a modern European, however, that in exchange for permitting the government to superintend citizens’ lives in ever greater detail it will bestow still more social-welfare rights, and the reaction will not be “Who do you think you are?” but “Where do I sign, and how soon do I get my benefits?”
The case against Swedenization, then, is that it threatens a soft and insidious despotism. Unlike the totalitarianism of the USSR, where the evil flowed from the top down, engulfing every aspect of society, the danger posed by social democracy is of social, political, and economic debilitations’ compounding one another. Progressivism began as, and remains, “an alliance of experts and victims,” according to Harvey Mansfield, a professor of government at Harvard. It gains strength as the experts assert their expertise more confidently and the victims accept their helplessness more compliantly. The kind of robust mediating structures Tocqueville thought essential to the success of democracy in America will not prevail against that alliance. If the experts determine that employer-provided health insurance must include contraception, the objections of religious organizations opposed to some or all forms of contraception are immaterial. The possibility that the republic’s free citizens could initiate financial or employment arrangements to secure contraceptives, rather than relying completely on government directives to their employers, is also ruled out of order.
Swedenization might work indefinitely in Sweden, a country whose population is 8 percent smaller than Los Angeles County’s and immeasurably less heterogeneous. As New York Times columnist Ross Douthat recently explained, Sweden has “no real linguistic or religious diversity, no experience of chattel slavery or mass immigration . . . and a culture of Lutheran thrift and prudence that endures even though Lutheranism itself is on life support.” The accompanying deference to experts and tax collectors, combined with residual social norms, could, he contends, “demonstrate that it’s possible for a welfare-state society to survive the waning of religion and the decline of traditional marriage without sacrificing middle class prosperity.”
It is also possible that Swedenization won’t work indefinitely, even in Sweden. Europeans’ admirable willingness to pay for the government programs they demand will be inundated by a demographic tide that leaves fewer and fewer workers supporting more and more retirees. Leftist politicians and writers treat this shift as an exogenous variable, an unfortunate contingency that has befallen the welfare state but reveals nothing essential about it. Megan McArdle and Ramesh Ponnuru have argued persuasively, however, that both social science and common sense suggest the welfare state is complicit in its own fiscal peril. Before the welfare state, I relied on my children to take care of me in my dotage, and you relied on yours to take care of you. After it, we rely on all our children to take care of all of us. The welfare state thus creates strong incentives for individuals to have fewer children of their own and rely instead on aggregated financial support from everyone’s children, thereby putting social-security systems under intolerable strain. Ponnuru cites two recent studies showing that the generosity of Europe’s welfare systems explains about half of the difference between the continent’s fertility rates, insufficient in every country to prevent the population from shrinking, and America’s, which remains above the level needed for population growth.
There is another sense in which Swedenization undermines itself. “The Scandinavian welfare states, which express so well a sense of obligation to distant strangers, are beginning to make it more difficult to express a sense of obligation to those with whom one shares family ties,” the Boston College sociologist Alan Wolfe has written. Most consequentially, those high, widely applied taxes make raising children in single-income families financially daunting. Even deeply reluctant couples can afford no choice other than entrusting their small children to the subsidized day-care center so that both parents can set off each morning to earn heavily taxed salaries.
“The irony of this development,” Wolfe writes, “may be that as intimate ties weaken, so will distant ones, thus undermining the very moral strengths the welfare state has shown.” The consummation of the liberal project was suggested when Marian Wright Edelman, founder of the Children’s Defense Fund, lamented our regrettable inclination to “distinguish between our own children and other people’s children.” When all children and dependent seniors are “my” children and “my” parents, however, none of them are mine. The effort to socialize our affections and obligations ends up attenuating them. Social democracy thus compounds democracy’s most ominous tendency, namely that, in Tocqueville’s famous phrase, it “constantly leads [each man] back toward himself alone and threatens finally to confine him wholly in the solitude of his own heart.”
The most dismaying explanation of the 2012 election was the public-opinion survey showing that 21 percent of the voters rated “cares about people like me” as the quality they most sought in a presidential candidate, one more important to them than the proffered alternatives: “shares my values,” is “a strong leader,” and has “a vision for the future.” Romney bested Obama among voters who considered any of these other three categories most important. The 21 out of every 100 voters who cared above all that the president cared about people like them broke for Obama against Romney, however — and by the landslide ratio of 17 to 4.
This is bad news, even allowing that fatuous poll questions elicit fatuous poll results. To the extent the survey is believable, a fifth of our fellow citizens now stand ready to reprise Barbara Walters’s entreaty to Jimmy Carter after his election as president: “Be wise with us, governor. Be good to us.” This supplicatory attitude is not the way a people capable and worthy of sustaining its republic regards elected public servants. The point is not that we should desire a president who is indifferent to us. It is, rather, that our republic’s health will be marked not by how much our politicians care for us, but by our ability and resolve to care for ourselves, and for our families and communities. Presidents, and governments, can do some things to invigorate those social ties, but can do many more to weaken them. Limiting government is necessary, but not sufficient, for strengthening civil society. Doing both is necessary for preventing American self-government from succumbing to a social-democratic experiment that may not work anywhere, and cannot work here.
– Mr. Voegeli is a senior editor of the Claremont Review of Books, a visiting scholar at Claremont McKenna College’s Henry Salvatori Center, and the author of Never Enough: America’s Limitless Welfare State.