Arnold Kling  

The Voegeli and Samples Show

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If you are in DC tomorrow morning, I recommend going to hear the authors of two new books. William Voegeli is the author of Never Enough: America's Limitless Welfare State, and John Samples is the author of The Struggle to Limit Government: A Modern Political History.

I got to attend a more private lunch at Cato today. Some points that were brought up:

1. There are no new arguments against the principle of the welfare state. However, there is increasing awareness of fiscal problems.

2. Reading either book would tell you that the history of conservative political victories since 1932 is that they have been rare, short-lived, and ineffective at slowing the long-term growth of the welfare state. On a contrarian note, Jonathan Rauch pointed out that the share of Federal spending in GDP has been quite stable at round 20 percent for a long time. However Voegeli replied that this reflects cuts in defense spending, and defense spending is now so low relative to GDP that we are near an arithmetic limit in terms of our ability to raise nondefense spending without raising total spending. Moreover, Jagadeesh Gokhale pointed out that most of our fiscal problems are unfunded liabilities for the future. I read the overall exchange as confirming that conservatives are correct to read the past several decades as expanding the welfare state.

3. Voegeli sees the fiscal strains as an opportunity for conservatives to succeed with policies that limit the welfare state to means-tested programs. Others of us question whether this would succeed politically or, if it did, whether it would be sufficient to limit the harm of Progressive ideology.

4. In addition to the fiscal unsustainability problem, the Left faces a looming threat from the unpopularity of public sector unions, particularly teachers' unions. I call entitlements and public-sector pay the two "weeds" growing in Progressive soil. As I have blogged previously, I am skeptical that dealing with these two weeds would really represent a durable triumph for conservatives.

5. What opportunities are created by the Tea Party Movement? Randy Barnett said that that the TPM might steer in the direction of Constitutional moves in favor of Federalism (in Wall Street terms, I might accuse Randy of talking his book). Participants generally were agnostic on what the TPM means for the more established conservative and libertarian movements.

6. Rauch touted a balanced budget amendment as something that would be simple and easily understood. Gokhale pointed out that it does not address the huge unfunded liabilities that we already have.

In fact, I would worry that a balanced budget amendment would lead to "binge spending," the way that a plan to go on a diet next month leads to binge eating. What I think I would prefer is a fiscal discipline pledge to be signed by politicians. As I see it, a formal constitutional amendment would be an invitation for Congressmen to play games to evade it. On the other hand, if you claim to abide by a fiscal discipline pledge in letter but violate it in spirit, then voters can call you on it.

Another advantage of a fiscal discipline pledge is that you could broaden it to plug loopholes. You could include in it a pledge to put entitlements on a sustainable path. (In fact, for me, that is the key to the pledge--more important than balancing the budget in the short run.) You could include in it a pledge not to balance the budget on the backs of the states through unfunded mandates or to balance the budget on the backs of corporations through regulatory mechanisms.

Ultimately, a fiscal discipline pledge is no stronger than the willingness of voters to enforce it. But in a democracy, we may not be able to do much better. What do you think?



COMMENTS (12 to date)
Mercer writes:

I suggest a historian's take on the TPM. A key excerpt:


"Tea Partiers need to realize that their candidates, even if elected, will be swallowed up in the great bloated system to which they so strenuously object. Any candidate who refuses, on principle, to bring home the bacon to his constituency will lose on Election Day, or, if somehow elected, will fail to be reelected"

http://www.nationalinterest.org/Article.aspx?id=23552

Until I see the TPM support limits to Medicare spending I will be skeptical about their rhetoric of a small federal government.

I think where state and local government pensions are far more generous then the private sector the GOP has a good issue they can use to trim government spending.

Teachers unions are unpopular with conservatives but where is the evidence they are unpopular with the general public? The governor of Florida vetoed a bill the teachers hated and he has not suffered in the polls.


Daniel Kuehn writes:

And the very next day Samples will be "debating" Gene Steuerle at the Urban Institute:

http://www.urban.org/events/versus/21st-Century-Government.cfm

I put "debate" in quotes because Steuerle is very sober, reasonable, and concerned about the budget - so I imagine it's going to be a deficit hawk vs. libertarian style debate (not a big government advocate vs. small government advocate debate), with perhaps more differentiation between them on philosophy and on details than on broad goals. Either way, it should be good.

Tom Grey writes:

We need automatic stabilizers -- a policy or policies that are deficit neutral over the business cycle but are active programs during "bad times". (And we need better definitions of bad times.)

My candidate is Tax Loans: companies and/or individuals get to "borrow" their previous (or current) taxes, at current Fed rates, to be repaid over time when unemployment drops below some level.
(I'd advocate below the prior 5 year's monthly avg. rate.)

This is more like tax deferral than cut, but gives taxpayers more cash now to save/ invest/ consume/ stimulate.


A budget neutral gas tax would also be good -- send out $1000 to all registered car owners now (or $100/month?), to be recouped with gas taxes starting in 6 months adding 5 cents a week until it reaches the rate to repay the $1000 checks.

JFox writes:

Well I think in the long-run, the only viable solutions are more social than legal. We need: i). a more virtuous society (i.e., less envy), and ii). much better education, especially at the 6-12 grade levels. Based on my conversations with many "liberals", a common thread is they see themselves as victims of big business and Wall Street. They see Big Government as their protector, albeit an imperfect one. For some persons, I think there is truth to this. Many people have little to no training in the areas of economics, law, accounting and finance. Our 6 - 12 education institutions are terribly lacking in these areas. A society whos members have greater self-sufficiency should reduce voter demand for the "nanny state."

MernaMoose writes:

As I see it, a formal constitutional amendment would be an invitation for Congressmen to play games to evade it. On the other hand, if you claim to abide by a fiscal discipline pledge in letter but violate it in spirit, then voters can call you on it.

I don't see that this is going to do any good. The majority didn't want ObamaCare, but we got it. There aren't enough of us to kill it, so we're stuck with it.

The "progressives" are intent on killing free markets, asap. There are just enough of them to get away with it under current democratic processes. I don't see anything we're going to do with fiscal amendments or "pledges" to stop the trend.


The only solution I see working, is where we a) re-stack the electoral deck so votes are weighted (more heavily) in favor of those who pay the bills, or b) get rid of elected politicians and appoint congress according to something like a lottery system, or c) some of both a) and b).

As long as politicians are elected by "popular vote", where everybody gets an equal vote regardless of what they contribute, then "progressives" and their ilk will always win in the long run. Because, there are always more poorer people than richer. If politicians promise something for nothing to the poorer segments, to be taken from the richer segments, the poorer segments will ultimately vote for it.

eccdogg writes:

Merna Moose, I like your lottery concept. That is what the Greeks did right?

You could base the probability in the lottery on the average of taxes paid over the last 5 years to incorporate the idea that those that pay should decide.

Probably would need an opt out clause to not force people to serve, maybe you could just choose not to register for the lottery. Also would probably then need a nice incentive to get people to participate. Something like 200k per year while serving plus lifetime pension of something like 25k.

System might be vulnerable to insiders that would facilitate the system.

MMJ writes:

How about a voucher system for education? Even Sweden has one:
http://news.bbc.co.uk/2/hi/uk_news/education/3717744.stm

We can spend less and get better results. Is that really a difficult sell?

Ryan Gleason writes:

Wasn't the "Contract with America" a similar pledge as the hypothetical one you describe? If so, then the history of such signed pledges by politicians doesn't bode well.

-Ryan

Brian writes:

Either their is a major change of heart in the main stream culture of the voting population (highly unlikely because it is counter to typical human behaviour) or we have some kind of civil war . Thoughs are about the only paths I see that could have a lasting impact on the welfare state before we declare bankruptcy. If that happens we most likely would have a civil war anyways. I really hope I am wrong though and there is a more likely less costly path.

@Mercer
Actually the bill vetoed by Crist in Florida was supported by a decent majority of Floridians per polls. I just wish the legislator would not of combined removing tenure with a teacher bonuses based on test scores. Christ was able claim he vetod it based on the performance sections. It would have been almost impossible to claim vetoing a bill which only removed tenure was "for the Children".


@MMJ - School Vouchers would only help State and Local spending. It would do almost nothing about the federal debt and future liability. Don't get me wrong I like the idea and it would save a lot of money.

@JFox- I find the idea of educational enlightenment by the state ridiculous. That is not the answer to fiscal issues. True, Education could play a small role but one cannot counter act a materialistic culture which does not care about future generations thru a state funded education system.

“If only people where better educated they would believe as I due, therefore we need to have better education.” Unless the education is teaching your exact belief system there is absolutely no historical evidence that the above idea has ever been true when organized by the state. The "education" is more akin or is outright propaganda then real education in these cases.

Exactly what evidence has ever been shown that state funded education led to its population making better long term decisions than the state not funding education?

The idea the state can do a better job at educating than parents is absurd. What I find fascinating is a large section of people who are strong believers in behavioral genetics seem to believe educational enlightenment will somehow change behavior. I don’t claim to understand genetic behavior arguments in detail but this is about as contradictory as one can get.

Komori writes:

@MMJ

Unfortunately, yes, it is a really hard sell. Every time something like that gets proposed the teachers unions go crazy and pull out all the stops against it.

Public workers unions of various stripes have huge war chests and no hesitation in playing dirty. You should see some of the "Your child's safety is at risk!" posters in California.

JFox writes:

Brian,

I didn't say the "state" would voluntarily improve education. I doubt that outcome. I just said that an improvement in our education system would pay dividends in the form of a less ignorant society. There are numerous ways that our education system would be significantly improved, despite "state" opposition. Different forms of school choice are the most likely.

Brian writes:

@JFox,

In regards to economic/finance education, I do find it sadly lacking. However, I really do not know how much removing ignorance would help. There would be some impact but I do not think to the extent you are implying. For example why is socialism still preached and supported by so many people despite having a strong economic training. I do not know how much better evidence one can get in economics.

The ability of human beings to rationalize a belief system despite overwhelming evidence is incredible. The temptation to vote yourself a pay raise and benefits even if you know in the long run it is a bad idea for the nation is incredible even for knowledge people. Look at the number of who have what I would consider decent finance understanding. How many are over their head in debt despite having decent jobs. When the cost of government spending are much less tangible and long term these people typically do not vote in a more intelligent manner. Knowledge does not equal wisdom let alone wise behavior.

I would settle for the general population realizing the government does not control the economy especially with the demi-God like power they give presidents. If education would get that through peoples skulls, at lest people would at some time before they reached the point of self deception be conscience that their voting behavior is bad behavior on some level.


The only way is to replace the religion of unlimited government with religions whose ideologies has limited government as part of its core thinking. This is at the core of the two paths I previously stated. I think that is where education can play a important role, to help bring about religious conversions. So I guess what I am saying is its not about knowledge alone but living a religious life style that is against unlimited government.

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