In June of 2009, The Rational Middle premiered on the national stage. Of course, by national stage, I mean 12 readers per day…well, maybe 12 readers per week. Right at the outset, the notion of government both big and small, interested me. The role of perception in how big government is defined was the subject of an early post, Other People’s Big Government. Human nature being what it is, our own plans are usually superior to those of our fellow citizens, and their plans are typified by the reckless endangerment of our liberties and way of life. I have written the idea often, but the point remains; in a nation of 300 million, everybody’s absolute liberty is impossible to maintain. The Stones had it right; you can’t always get what you want.
But if you try really hard, you really can get what you need. And that idea friends, is what our arguments should revolve around. The major problem now, is that our problems, dreams, ambitions, and issues have been marginalized in favor of ad-friendly soundbites. Our democracy is being talking-pointed to death. The phenomenon of the day is an outgrowth of how detached we the people are from our own ability, our own right, to chart the course of the nation. It may make perfect sense to establish policy that rewards personal responsibility and ambition within the working class, it makes none to structure an economy that favors only the most wealth-defined successful within the construct. This is precisely the path we have taken over the last three decades, and the results of the journey ought to be self-explanatory.
We the people start fighting for our liberties at an early age in these United States. We battle curfews, bans on loud music, mandatory education, and jack-booted thugs who demand we not travel beyond the speed of sound in a school district. As parents, we put the shoe on the other foot, and explain to our kids that laws are in place for a reason.
“Of course I know you know how to drive son, and of course I trust you. It’s just the other people that I am worried about.”
Sure. Just as there are local laws that make little sense, there are regulations poorly written and sloppily enforced at every level of government. Local governments in particular are bastions for restrictive business requirements and out of scale taxation. A great portion of our tax and regulatory structure is imposed at the local level, in fact, and the national push to lower federal taxes has forced more costs and higher taxes onto local governments. And before you ask, yes; conservative states and counties fall into that category. Those orderly, safe, and moral communities that lack the billboard clutter, neon displays, and tawdry businesses of the nations “other” communities represent the most anti-business environments (by conservative/libertarian definition) in the nation; I will bet that in your neighborhood those communities are conservative.
Because it is other people’s big government that we despise, and our perspective on economic liberty is influenced by the concept. Our parents, who had little in the way of material wealth, sent us to public school. There, we worked hard to improve ourselves; we pulled ourselves up by the bootstraps. Therefore, we hate the idea of socialism and/or the welfare state (concepts we have a poor, media-informed notion of); we refuse to happily accept a nation where our efforts go to support the lazy and unambitious.
That we received our education in a socialist program doesn’t matter. That we and our business continue to be protected by a socialist police and fire department matters not. That we didn’t have to compete for jobs with the 20 million or more senior citizens who would be in the work force without the socialist social security program doesn’t matter. That we would have to, were the socialist social security program not around, spend a sizable portion of our income caring for our parents, financially limited as they were, in their golden years, doesn’t matter. The economic effects of the social welfare state are not a net negative, if for no other reason than government checks in the hands of a consumer spend better than no checks.
Much of the tax programs of the last thirty years were sold politically as boons to small business. The U.S. Chamber of Commerce, to this day,still presents itself as a warrior for small business. Yet definitions most folks have for what a small business is are far from the concept the tax plans are designed to assist. Some months ago, as an example, Mike Huckabee clarified his notion that small businesses are those with less than $1 million per year in taxable revenue. Friends, Joe the Plumber wouldn’t fall into that definition unless he employed 100 journeyman in his firm. The local florist, mini-mart operator, pizza parlor owner, and general contractor are working hard for $50,00-$100,000 per year, and have seen precious little of the tax benefits of the last three decades.
We have worked hard to “improve” the business climate in America since 1980; how is that working out in your community? We have worked hard to “improve” the incentives to become rich since 1980; has that created more opportunity for you and your family? When intellectual grave-robbers like Art Laffer and Alan Greenspan sold Ronald Reagan (and 55% of the rest of us) supply-side economics, the pitch was simple; the rewards earned due to lower taxes on the wealthy and large corporations would “trickle-down” into the economy at large.
Thirty years later, it is evident (forget evident, it is beyond dispute) that supply-side economics has been invalidated as a theory. Every time America’s economy takes a shot to its mouth, it is the time-honored and repeatedly proved Keynesian economics that comes to the rescue. Saint Ronnie the Gipper himself used the notion in the 1980’s, when massive deficit spending in stateside military projects jump-started the stag-flated U.S. economy. It hasn’t trickled down, it isn’t trickling down, and it won’t be trickling down anytime soon. A new story, therefore, must be sold to the masses for why we need to make taxes zero on the wealthy and pay for it by squeezing the working class.
Now we are told that demanding an end to supply-side economics; that simply rolling back tax rates to the 1990’s, is the equivalent of launching class warfare against the rich. We are told to ignore the economic success of the late 1980’s, when tax rates were considerably higher than they are now. We are told to ignore the economic success of the 1990’s, when tax rates were considerably higher than they are now. When the Occupy protests started to gain popular polling support, we began hearing that the class warfare wasn’t being waged against the rich, it was being waged against working taxpayers. When the story keeps changing, the underlying concept is bullshit. If business was good when taxes were higher, and higher taxes mean the end of deficits and harmful program cuts, then why the hell aren’t we raising them?
To the best of my recollection, America was the undisputed economic superpower on the day Ronald Reagan took office in 1981. To the best of my knowledge, America had lots of millionaires and small business owners in 1980, and even more of both in the 1990’s. Reagan’s election, and the election of thousands of others who literally worship the man to this day, paved the way for supply-side economics to get its full and fair hearing. More than thirty years hence, and America is no longer the undisputed economic superpower in the world; in fact, we are having a hard time feeding and caring for our own people. We pay a flat tax to pay for our nation’s economically free and medically-cared for retirement. A small adjustment to that tax would close potential shortfalls for the rest of the century. Why should we go in the other direction? The Laffer Curve and the rest of that garbage has had its full and fair hearing.
Supply-side economics has failed.
If you want a good look at libertarian policies, take a business trip to Mexico or Somalia; in those nations, the taxes are low, the regulations lax. When you are done fighting off the stomach cramps, come back home and be thankful. Is it really the goal of a Marxist revolution to recreate the federal tax rates of either the 1990’s or the Reagan years? Marxism is just another ad-friendly soundbite, and a modest measure of socialism mixed into a capitalist economy is a good thing. In any case, “dirty” words aren’t what your choices as citizens are really about. In one year, we will have the choice to vote in the interest of us and our working neighbors, or the interests of the very rich and a fantasy that we might join them. Think carefully about that choice.
The Rational Middle is listening…