The Conscience of a Liberal

Despite modern liberalism’s sweeping scope, no one seems to know quite what it is. Liberalism appeared somewhere in the sixteenth century—“St. George, in the guise of Rationality,” as Kenneth Minogue puts it—to slay the dragons of despotic kingship and religious intolerance. Centuries later, liberalism slew the dragons of slavery, poverty, and later “the inert scaliness of privilege, vested interest, or patrician insolence.” When an ideology is defined by fighting for causes, however, its success is followed necessarily by its own extinction. With exceedingly few dragons remaining, then, intellectual liberalism faces some level of discomfort.

In response, liberal columnist and economist Paul Krugman proposes in his book, The Conscience of a Liberal, that liberalism be defined by a commitment to preserving and extending the objectives of the New Deal. Specifically, Krugman’s liberalism is principally concerned with the task of reducing wealth inequality. Krugman, Paul (2009). The Conscience of a Liberal (p. 267). W. W. Norton & Company. Kindle Edition. More important than liberalism’s ends, however, are the means Krugman proposes to achieve them. Neither society nor economics fit the bill, according to Krugman.  No choice is left, then, but to employ coercive government action: “Middle-class societies don’t emerge automatically as an economy matures, they have to be created through political action. . . . It took FDR and the New Deal to bring [a relatively equal] society into being.” Id. at 18.

However, Krugman fails to establish that the substantial federal government intervention of the New Deal and its legacy was or is necessary to bring about a healthy and diverse middle class. At most, he argues the New Deal accelerated those changes—not that they were otherwise impossible. In fact, although Krugman acknowledges that the New Deal could not have been successful without World War II, he fails to discuss whether World War II’s profound stimulative effect on the economy could not have been successful without the New Deal.

More importantly, Krugman also fails to establish that the animal he proposes to slay is even a dragon at all. Despite Krugman’s emphatic denunciation of the top one percent of this country’s earners, he offers no analysis of the increase in wealth and improvement in living standards in absolute terms for the rest of Americans. Krugman thus fails to establish that current wealth distribution is either procedurally unfair or substantively problematic.

Krugman’s narrative begins with what he refers to as the “Long Gilded Age” from the 1870s to the 1930s. Sorely missing from Krugman’s historical account, however, is a treatment of the Progressive era from the 1890s to 1920. The omission is conspicuous given the popular association between Progressivism and modern liberalism. To be fair, liberalism is more closely associated with the New Deal legacy than the Progressive legacy. The Progressives’ campaign against individual rights—advocating forced sterilization and eugenics, among other things—ultimately led even FDR to distance himself from the movement.  In its early stages, Progressivism was a reaction to the decline of Victorian values, sagging under the weight of an increasingly industrialized and fractured American society.  Campaigns to stem the uptick of divorce, prostitution, and drink resulted in our nation’s first flopped constitutional amendment.  Progressives also were content to use the power of their new labor unions to exclude blacks and immigrants from entire industries.

However, Progressivism and liberalism do share at least two important traits. First, Progressivism was, like liberalism, a moral movement that sought to engineer a more perfect community of man. The Progressive moral project, although conservative in its early years, became notorious for its secular objectives. Second and more importantly, Progressivism was not content to influence society at merely the state and local levels—it promoted its agenda on a national scale. In these two qualities, liberalism resumed the Progressive project: it advanced a secular agenda in conjunction with social science theory and experimentation, and made the national proliferation of these policies the bedrock of its platform.

In A Fierce Discontent: The Rise and Fall of the Progressive Movement in America, 1870-1920, Michael McGerr outlines the social, political, and economic forces giving rise to the Progressive movement.  By the late 19th century, American individualism, loosed across a vast continent connected by an unprecedented network of rail and telegraph wire, was putting unbearable strain on America’s underlying social fabric.  Divorce rates following the Civil War inclined steeply as high society became obsessed with the pursuit of wealth and self-aggrandizement.  While the Victorians had balanced individual freedom with self-control, hard work, and domesticity, the wealthy’s indulgent secular streak redefined individualism to legitimize inequality. From their perspective, their parties “helped the economy because ‘many New York shops sold out brocades and silks which had been lying in their stock-rooms for years.’”  The wealthy, however, did not seem to acknowledge the growing resentment their social inferiors felt toward them. Teddy Roosevelt tried to stave off the coming revolt, noting that social and political stability impel the wealthy to observe certain “duties toward the public.”  “Do they not realize that they are putting a very heavy burden on us who stand against socialism; against anarchic disorder?”  “I wish that capitalists would see that what I am advocating is really in the interest of property, for it will save it from the danger of revolution.”

The extravagance of the upper 10 percent during the depression years of the 1890s galvanized populist resentment. Industrial work was distantly attenuated from its product, and thus the traditional agrarian work ethic, like the traditional agrarians themselves, began to wane. Victorian individualism became impossible for the lower classes as many workers could not make enough money to support themselves or their families.

Despite all this, the spirit of equality prevailed. Those workers who could afford to save declined to do so and instead indulged in the finer things just as the wealthy did. “If my lady wears a velvet gown, put together for her in an East Side sweatshop,” a reporter in New York observed in 1898, “may not the girl whose fingers fashioned it rejoice her soul by astonishing Grand Street with a copy of it next Sunday? My lady’s in velvet, and the East Side girl’s is the cheapest, but it’s the style that counts. In this land of equality, shall not one wear what the other wears?” Booker T. Washington also documented this burgeoning sense of entitlement to material wealth, irrespective of the means to acquire it. He expressed concern that humble families who shared a single fork among four people nonetheless boasted organs and sewing machines and fine clocks purchased on installments. Shopping also became a leisure activity.

This rise of hedonistic individualism hastened the decline of Victorian values as well as marriages, as spouses began judging their mates in terms of material pleasures and the happiness of the marriage. McGerr states that “The failure to meet those increased expectations was a principal reason for the increasing breakup of Victorian marriages.”

This new form of individualism came as a result of a growingly diffuse economy in which labor and consumption had become only distantly and obliquely related.  Industrial work was attenuated from its product, and thus the traditional agrarian work ethic, like the traditional agrarians themselves, began to wane.  The American laborer no longer provided his own essentials of survival, but instead deposited his effort into a vast and complex economic machine.  His yield, his “wage,” served as the only symbol of his output, a rebuttable presumption of the value of his labor.  And, as his commercial appetites continued to increase, American workers started to rebut the presumption.  The wage system was being thrown into upheaval:  if the market would not set a wage sufficient to meet the American worker’s standard of living, he would set it himself.  “It seems to me that when a man, my father, works all day long, he ought to have a beautiful home, he ought to have good food, he too ought to get a chance to appreciate beautiful music.”  Thus formed a new basis for “individual rights” in American politics.

Industrialization drew Americans out of the farms and into cities. Though farms often provided mere subsistence living, they also gave Americans pride and fulfillment.  Cities and their factories offered a markedly different experience, however, making working class Americans increasingly discontent. Individualism became a natural target.

Conservative activists took aim. Social Gospel leader Washington Gladden, for example, traced prostitution to middle- and upper-class affluence, as young men increasingly began to put off marriage “until they are able to support a wife in good style.” When people postponed marriage, Gladden argued, “one of the inevitable consequences is the increase of social immorality.” “The morality of what we call our respectable classes needs toning up all along this line.”

It is this sentiment—that “morality . . . needs toning up”—that represents the conservative contribution to Progressivism:  as new social, political, and economic forces began to disrupt cultural and moral values, many conservatives sought to push back in kind not merely to curtail those effects, but to counteract them.  Man and his moral character were no longer something to be left to the sole province of himself and his community; they must be “toned up” and remade through the law.  Under the Progressive construction of man’s moral predicament, man was no longer accountable for his own actions.  Because people were malleable and defined by their environment, criminals were not wholly to blame, since their crimes owed in part to the sins of society.  “What we have got to have,” said Gladden, “is a different kind of men and women.”

Thus, a renewed vigor for morals legislation ensued, directed at card playing, gambling, horse racing, Sabbath breaking, pornography, dance halls, contraception, and, most famously, liquor.  Liquor, more than all other vices, was seen as the root of man’s moral decline—particularly, the breakup of the family and the degradation of women.  The infamous Carry Nation excoriated the display of a nude painting in the bar of the Carey Hotel in Wichita. “Women are stripped of everything” by saloons, Nation fumed. “Her husband is torn from her, she is robbed of her sons, her home, her food and her virtue, and then they strip her clothes off and hang her up bare in these dens of robbery and murder. Well does a saloon make a woman bare of all things!”

Yet, Progressives quickly realized that prohibition of vices was not enough:  remaking man could not be achieved by negation alone—it would require an affirmative component.  Progressives thus found “substitutes for the saloon,” such as alcohol free clubs and dance halls, libraries and gymnasiums. In short, as McGerr puts it, “the transformation of individuals required a more sweeping transformation of their environment.” Progressives began to remake rather than merely preserve society.  Law was no longer just an anchor; it was also a sail. This lesson would later be carried over into modern liberalism.

This aspect of the Progressive agenda was clear by the time of Woodrow Wilson’s presidency, who stated:  “Our problem is not merely to help the students to adjust themselves to world life. . . . Our problem is to make them as unlike their fathers as we can.”  Progressivism had by this time become a different thing entirely than the post-Victorian conservatism from which it began.  Indeed, it could be said the project never was truly conservative in the first place, and that the lament of the decline of Victorian values was merely lip service to justify brewing radicalist urges.  Thus, perhaps even the prescriptive components of the early Progressive agenda were less about preserving Victorian values than preliminary efforts at remaking all of society—the symbols of Victorianism simply served as a convenient cover of authenticity for an otherwise radical movement.

Whatever their original intentions, Progressives eventually settled on an agenda that harmed conservative values. “Ironically,” McGerr puts it, “reform could destroy what it was intended to preserve. Crusading in the name of the home, reformers were supplanting the very thing they wanted to protect.” According to E.A. Ross, the Progressive agenda eroded man’s moral fiber:  “Too much consideration for moral weakness would fill the world with moral weaklings,” he insisted. “To abolish temptation is to deprive the self-controlled of their natural right to outlive and outnumber those who have a cotton string for a backbone.” Leisure, Kate Gannett Wells contended in an 1891 essay “Why More Girls Do Not Marry,” bred discontent: “Fifty years ago the woman was too busy to stop for the morning kiss as her husband went to work.  Now she has time to think about the absence or infrequency of the greeting for half an hour before she reads the morning paper, in which she finds some fresh instance of man’s wickedness.”

American industrialization in the early 20th century, contributing to the social and political forces underlying the Progressive movement, appeared to be following the economic cycle described by Nobel laureate Simon Kuznets. “Kuznets’ Curve,” as it is known, posits that the early stages of industrial development presents increasing investment opportunities for those with capital. That industrial development forces wages down as cheap rural labor floods into the cities. Industrialization thus amplifies inequality. Eventually, however, these forces level out: “capital becomes more abundant, the flow of workers from the farms dries up, wages begin to rise, and profits level off or fall. Prosperity becomes widespread, and the economy becomes broadly middle class.” Krugman at 45.

This is not what happened in America, according to Krugman, who instead credits the New Deal with creating the modern middle class.  He explains that the rich were no less dominant in 1937 than before World War I, but that in the next ten years, top incomes sharply declined. This sudden shift, Krugman says, is more indicative of sweeping economic policies—New Deal tax policies, in particular—than with the natural progression of economic cycles. The top income tax rate rose to 63% during FDR’s first term, 79% during the second, and 91% by the mid-‘50s. Billionaires (so-defined after adjusting for inflation) declined from 32 in 1925 to 16 in 1957 and to 13 in 1968. Today, Krugman observes, there are approximately 160. Krugman at 18. Krugman boasts that “[b]y the mid-fifties the real after-tax incomes of the richest 1 percent of Americans were probably 20 or 30 percent lower than they had been a generation earlier. And the real incomes of the really rich—say, those in the top tenth of one percent—were less than half what they had been in the twenties.” Id. at 41.

FDR also dictated wages and prices to the private sector through the National War Labor Board. Employers were permitted to raise wages to 40 cents an hour without approval; wages up to 50 cents or more had to be approved by the NWLB or Washington, respectively, thus chilling highly paid employment. After the war was won, there was neither political will nor economic need to restore freedom to the private sector: as part of the successful war effort, FDR’s policies were popular, and American industries were able to make up the difference through access to new markets and economic hegemony. Thus, Dwight Eisenhower wrote in 1954 that “Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. . . . Their number is negligible and they are stupid.”

In fact, the basic egalitarianism set in motion by FDR persisted for more than 30 years. Krugman concludes this means “institutions, norms, and the political environment matter a lot more for the distribution of income—and that impersonal market forces matter less—than Economics 101 might lead you to believe.” Krugman at 8.

Of course, none of this is an argument that Kuznets was wrong—it simply explains that Kuznets’ Curve does not explain what happened in America, given the drastic economic intervention of the New Deal. Moreover, Krugman admits that prior to the New Deal, “modest moves toward a more equal society were already under way before the depression struck—not at the federal but at the state level.” Id. at 35. However, Krugman never attempts an argument that the curve would not have tended downward without the drastic and lasting measures implemented in the New Deal, even if not as quickly as Krugman might prefer. More importantly, Krugman never discusses the nature of wealth resulting from coercive national economic policy—i.e., whether and to what extent it was real or artificial, sustainable or transient.

Krugman also largely ignores the economic impact of World War II. Although he acknowledges “[t]he full transformation needed the special circumstances of World War II” (Id. at 51), he fails to discuss the effect of the heavy trend toward industrialization that persisted after the war, and the global economic hegemony American industry enjoyed following U.S. victory. The New Deal’s gamble in profligate spending ultimately paid off because of the war, but that result was by no means a foregone conclusion. In other words, it is quite likely that World War II did not simply enhance the New Deal, as Krugman suggests, but saved it altogether.

These gaps in the analysis become problematic when Krugman attempts to explain why things began falling apart by the ‘70s. Krugman hails the three decades following World War II, from the mid-forties to the mid-seventies, as “the golden age of manual labor.” A high school degree fetched as comfortable and secure a lifestyle as at any point in history. By the ‘60s, however, signs of strain began to appear. Crime more than tripled between 1957 and 1970. Welfare rolls doubled between 1956 and 1966, and more than doubled again in the “welfare explosion” of the late 1960s and early 1970s. After the New Deal saved America from the crushing income inequality of the Long Gilded Age, Krugman observes, America began to relapse.

Krugman posits two popular explanations for the growing divergence in wealth. One, economic in nature, is the rising demand for skilled labor, referred to as skill-biased technical change, or SBTC. Many economists attribute SBTC for rising income inequality, pointing to its timing with increasing computerization. The other explanation, political nature, is changes in institutions, norms, and political power.

Rejecting SBTC as an explanation, Krugman cites the insufficiency of “direct evidence” to prove its causal relationship with rising inequality. Krugman at 132-133. This is a strange objection given that “direct evidence” is rarely demanded or, indeed, available to explain macro-economic phenomena.

Nonetheless, Krugman embraces the political explanation. He emphasizes that the post-New Deal middle class largely relied upon “pattern wages” defined by wage settlements of large unions and corporations that “established norms for the economy as a whole.” Krugman at 138. Today, however, many large firms have succeeded at breaking away from pattern wages. Wal-Mart, for example, pays nonsupervisory employees about $18,000 a year, “less than half what GM workers were paid thirty-five years ago, adjusted for inflation.” Id. at 139. In contrast, by the early 2000s, U.S. CEOs’ average $9 million annual pay was 367 times the pay of the average worker, up from 40 times that pay in the 1970s. Id. at 142. This was able to occur because, as Krugman states, with apparent sincerity, “there is a vast right-wing conspiracy.” Id. at 163.

Paranoia aside, this is basically an apples-to-oranges comparison indicative of an approach to labor as fundamentally moral rather than economic. There is not necessarily any economic reason to suspect that CEO pay and average worker pay will be tightly correlated. On the other hand, Krugman contends the disconnect may owe to a defect in the process of setting CEO compensation, as “top executives in effect set their own paychecks.” Thus, “neither the quality of the executives nor the marketplace for talent has any real bearing.” This might in part explain why CEO income has risen from about 30 times the average worker in 1970 to more than 300 times today. Krugman at 136. If this is true, Krugman argues, income inequality has been able to rise “not because of an increased demand for talent but because a variety of factors caused the death of outrage.” Id. at 144-145. This “shame factor” may be more prominent in European firms. Id. at 148.

Being a defense of liberalism as a political ideology, Krugman’s argument does not condemn income inequality on economic terms. And it is only near the end of the book, at page 244 of 274, that Krugman finally offers his ideological response to the question, “Why should we care about high and rising inequality?” Krugman offers two reasons. First, he argues that there has not been “clear economic progress for lower-and middle-income families” over the past 30 years. Id. at 244-245. “The fact that we’re even arguing about whether the typical American has gotten ahead,” Krugman insists, “tells you most of what you need to know. In 1973 there wasn’t a debate about whether typical Americans were better or worse off than they had been in the 1940s.” Id. at 126. This “in itself” calls for economic redistribution, he concludes. Id. at 245.

But how can the economic progress of the past 30 years not be clear? Steve Horwitz, for example, explains that readily available data, including from the U.S. Treasury and the Census Bureau, show a significant amount of real economic improvement among the poor in the past 30 years. Between 1996 and 2005, according to U.S. Treasury figures, 58.6% of the lowest quintile moved up at least one quintile, and 29.1% moved up multiple quintiles. Horwitz concludes from this data that “income mobility in the US is still alive and well, with at least half of poor families moving up a quintile in around ten years or so, and decent number moving two or more over that same time span.”

Aside from wages, all Americans enjoy access to the significant improvements of the past 30 years in technology, medicine, communication, home appliances, entertainment, and travel.  Each of these improvements significantly improve the quality of American lives. It is not obvious why Bill Gates’ wealth is a problem, Tyler Cowen explains, when his fellow Americans “have access to penicillin, air travel, good cheap food, the Internet and virtually all of the technical innovations that Gates does.” In absolute terms, all Americans—even those below the poverty line—live markedly better lives than in the ‘70s. In fact, Horwitz explains, they live better even “than did the average US household in 1971.” And these upward trends hold true for black and Hispanic households. It seems quite possible, then, that working- and middle-class stagnation is a myth.

Tyler Cowen offers an alternative hypothesis. In his ebook, The Great Stagnation, Cowen explains that America picked all the “low hanging fruit” in the decades following World War II. While further prosperity is left to be had, it will come only with increased investments of skill, capital, risk, and innovation. No longer will a high school diploma purchase the heaping slices of American dream served up during the ‘50s and ‘60s. The value of blue collar labor has flattened, and new prosperity must come from white collar efforts.

Also ignored by Krugman is the inequality of work hours. Cowen observes that top earners in the U.S. work substantially harder today than in the Gilded Age, while the rest of Americans work less. This may be related to a phenomenon that Cowen calls “threshold earners,” that is, “someone who seeks to earn a certain amount of money and no more.” When a threshold earner’s wage goes up, he will seek less work or will work less hard or less often. Threshold earners’ behavior is based on absolute earning power since they place high value on non-monetary factors such as leisure. When an economy affords everyone the opportunity not only to earn unsightly amounts of money but also to earn just enough money in absolute terms, it is impossible to avoid income inequality other than by removing the productive incentive of non-threshold earners—in other words, by destroying value.

In this respect, we can hear echoes of the early Progressives. Recall that, as described above, Progressives attributed the breakdown in the social structure to the trend toward putting off marriage and child-rearing. Today, rising income inequality might be attributed to the same cause. Cowen observes that single-occupancy households in the U.S. are at an all-time high, and that “it seems reasonable to suppose that the more single-occupancy households there are, the more threshold earners there will be, since a major incentive for earning money is to use it to take care of other people with whom one lives.” The irony is not lost on Cowen, who explains:

For years, many cultural critics in and of the United States have been telling us that Americans should behave more like threshold earners. We should be less harried, more interested in nurturing friendships, and more interested in the non-commercial sphere of life. That may well be good advice. Many studies suggest that above a certain level more money brings only marginal increments of happiness. What isn’t so widely advertised is that those same critics have basically been telling us, without realizing it, that we should be acting in such a manner as to increase measured income inequality. Not only is high inequality an inevitable concomitant of human diversity, but growing income inequality may be, too, if lots of us take the kind of advice that will make us happier.

Income inequality results from one of two things: natural inequality or procedural injustice. Little can be done about the former, while both the left and the right rail against the latter, though for different reasons. The left fingers crony capitalism—special favors the private industries wrest for themselves through agency capture and campaign contributions—as the great evil that threatens our democracy. The right, for its part, fingers crony activism—special favors that activist groups like environmental firms and labor unions wrest for themselves by the same means. In their respective plights against these (very similar) procedural injustices, both political parties are fighting the good fight against Federalist no. 10 factions. The inequality yarn that Krugman spends 300 pages spinning, however, is a red herring.

[Cross-posted at Notes From Babel]

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95 thoughts on “The Conscience of a Liberal

  1. >The left fingers crony capitalism—special favors the private industries wrest for themselves through agency capture and campaign contributions—as the great evil that threatens our democracy.

    That’s interesting, seeing how they’re so often the ones who actually enable and establish these things.

    Everyone should read “Reckless Endangerment” which chronicles the “Public private partnership”s that caused the Housing Bubble and subsequent and present economic collapse. 90% of attributible to Leftists in government.

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  2. I am no expert, but I am not sure how I feel about the claim that all Americans have access to such great and wonderful things as modern medicine, air travel, the internet, etc. Sure many do and for a while most all did, but it seems that much of the American people’s access to these things is built up on credit as opposed to truly being able to afford them. This seems like a dangerous position for us to stay in.

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    • That is a factor. Steve Horowitz heads off that objection as follows:

      US households below the poverty line have more in their homes than they did in the 1980s or the 1990s, and they have some items that didn’t even exist back then! (And to head off one objection, there is no evidence that this has all been bought on credit.)

      Notice, however, that he says there is no evidence that this has “all” been bought on credit—i.e., there may be evidence that some or even a significant part of it was.

      So yes, this question is along the same lines as whether the value we’re creating is real or artificial. Buying stuff on credit is just one more bubble we have to contend with.

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  3. In other words, Krugman is an absolutely lousy historian.

    This should come as no surprise to anyone. Ignoring the fact that he’s a ideological blowhard and thus hard to take seriously as a first order matter, he’s an economist. Economists are almost uniformly lousy historians. Most of them can’t even get the history of their own discipline right, much less do a halfway decent job of historical analysis in other contexts.

    It’s hardly fair to expect him to produce a work on par with Carl Becker or Bruce Catton, but it isn’t unreasonable to ask him to at least be aware of his own limitations and the fact that people better at this than he is have already taken a stab at this.

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    • Ryan,

      You’re probably right. To give him some credit, Krugman’s 30,000 foot overview of the “Long Gilded Age” was decent, at least for mass consumption. The analysis of the New Deal and beyond, however, was not very good at all.

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  4. And the difference between saying “Yeah, it might look to the uneducated like the New Deal worked, but it would have been so much more awesome if we never had it” and “The recession would have been so much worse without Obama” or “If not for the North, Southerners would have freed the slaves and eliminated racism” is what, exactly?

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    • You’ve got me. I also find it somewhat silly to argue that there remains typically American levels of social mobility in this country, considering the reams and reams of social science I’ve read before that indicate otherwise (that indicate, in fact, that the US currently has lower levels of social mobility than the UK [long a bastion of fluid class structure!!!] the Netherlands, France and Germany [among others]). But I’ve never read Mr. Horowitz, I admit.

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      • I can’t speak for Horwitz, but one thing I’ve seen is studies that treat progression like mobility. A medical resident makes $40k a year, then graduates and makes $240k a year, and it looks like mobility but in reality is merely progression. That someone worked for twenty years to make $40k is making more than some 20-something year old kid who is making $35k is a small comfort. The kid making $35k a year will likely be making a lot more in due time. The real comparison (to me) is how a man working twenty years compares to other men working twenty years compares to someone working twenty years in a previous generation. I think the studies suggesting a lack of mobility are looking at that.

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      • I’ve obviously not read the reams you have, but I have to say I find the notion of social mobility in US vs. UK favoring UK to be startling to the point of skepticism. I’ve spent a lot of time in the UK, and if you are correct it almost seems like it must be happening against their will. I’m dubious.

        I wonder what these studies mean, exactly, when they talk of mobility?

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      • What study have you seen that shows the UK to have higher social mobility than the U.S.? The few studies I’ve seen have the U.S. near the bottom of developed nations in social mobility, but the UK at the bottom. I mean, the UK is pretty much where social mobility goes to die.

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        • That was from memory, from a course I took years ago, and I can’t find the article whereas I’ve found many that say what you’re saying, Chris: that both Britain and the US are among the very worst, but Britain is clearly the worst. So I’d like to take that one back; because even if I find the article that floats through my memory, it would be the outlier.

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    • Um, and the difference between your hypothetical and saying “Yeah, it might look to the uneducated [aka Republicans, conservatives, libertarians] like the New Deal didn’t work, but it would have been so much worse if we never had it” is what, exactly? Evaluating historical counterfactuals is no doubt difficult, from whichever angle, but it’s hard to avoid if we intend to make use of history at all.

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      • Not really. The best historical arguments don’t make use of counterfactuals as much as they try to explain what actually did happen. Krugman seems to be long on counterfactuals and short on facts, making his argument far more ideological than historical.

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      • I don’t actually have a problem with evaluating history – and despite you’re suggesting otherwise, you’ll notice I took examples from both sides of the ideological spectrum to make my point. I am not arguing that you can’t learn from history.

        I *am* arguing that when you have to use long winded socio-economomic-historic-philosphical-whatever arguments to prove that the country and it’s policies overall have been an unsuccessful failure over the past 70 years – when they cleeeeearly have not – because the possibility of that success doesn’t fit with your political mindset, you’re not really “intend[ing] to make use of history,” you’re reinventing reality to give your politics an undeserved victory.

        And if this doesn’t make sense because you feel I’m just picking on the right, feel free to apply my point to lefties that (constantly) argue that the Reagan years brought us to a financial ruinous collapse.

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          • I’d say that considering the degree of success that we have right now when compared to everything that has come before – indeed, that we live the lifestyles we do now with the comparative freedoms that we do and consider it an apocalyptically bad time – means that “ruinous” is a pretty damn relative word.

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            • Financial crisis of 2008?

              I mean, Reagan doesn’t get credit for modernity entire, does he?

              Plus, things are pretty good for us, sure, but (making an assumption here, forgive me if it’s incorrect) we’re not of the socio-economic sphere that would ever suffer too appreciably in this regard.

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              • Also agreed. But I would argue to you (and with the Koz-s of the world as well) that it is folly to compare ourselves with a Utopian ideal to measure the success of our policies. Better to see where we are now compared to where we have come from. And to be honest about that evaluation, even (especially?) when that evaluation goes against your ideological leanings.

                An example that you won’t have to fight to show what I’m trying to say:

                In the past few months here, I’ve come across the the argument of comparative poverty a few (maybe 3?) times on this site by people arguing against the New Deal. This argument is: “In real dollars, accounting for inflation, cost of living, yadda yadda yadda, the average annual income before the New Deal was $16000. Now that amount is the poverty line. This proves that the New Deal is a sham, because the line that we call poverty keeps creeping up.”

                Now, the decision of where to draw the poverty line may be a discussion worth having. But latching on to that but *completely ignoring* the obvious point that this means we are all, on whole, much much better off financially since the advent of the New Deal is handpicking data to support your ideology.

                Have we eliminated poverty? Nope. Should we keep trying? Absolutely. Should we pretend that when we talk about today’s poor not having access to nutrition, education or healthcare it is entirely different – and worlds better – than when we say that the poor didn’t have access to those things 100 years ago? I think in the interest of honesty, yes.

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                • I’m not measuring it against a Utopia though. (Ugh — I hope I’m not the leftwing Koz in your mind!) I’m measuring it against the admittedly imperfect (but in my mind nonetheless better) economic status quo of the post-War era, pre-1973. I think there are lots of arguments as to why things in terms of economic equality, mobility, and stability (for the middle class, at least) are not what they were — and they could be explanations like Cowen’s that are rather apolitical — but I wouldn’t agree that things are better now than they were. Or at least not by my chosen criteria.

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                  • I was just choosing Koz cause he’s the most unabashedly “conervatives-always-good, liberals-always-bad” guy I know of here.

                    And even if we disagree about whether 2011 is better place to live in than 1972, I hope we can agree that that difference is a matter of small degrees when compared to most of the rest of human history. (Or even 1776.)

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                    • My main problem isn’t that life isn’t better in 2011 than 1847. But there are places on this planet it is better to be alive right now as the median person than in America.

                      Yes, Joe American may have a higher average incomes than Johann Germany, but Johann isn’t paying a big chunk of his paycheck for health insurance, doesn’t have $50,000 in student debt, etc and quite frankly, once you throw in property and sales and local taxes plus their student loans, health insurance, and child care costs, the average European isn’t paying all that much taxes than we’re paying for the same services.

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                    • And again, I say that you’re arguing over a a matter of degrees that are dwarfed by almost any other time in the past.

                      And BTW I think that the point you make is a valid one; certainly the healthcare cost factor is going to get worse before it gets better.

                      I just don’t like arguments that rely on painting our country today as being at the bottom of history’s ethical/moral slag heap, or suggest that in a few months we’ll all be trading the gold we’ve hoarded to those that are able to hunt squirrel meat to survive.

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                    • That’s certainly an interesting argument. “We have the ability to make life much more secure and better for the average person, but hey, you’re better off than people were a hundred years ago, so stop whining.”

                      Sorry, that’s doesn’t jive with me. People during the Great Depression could listen to the radio and go to the movies. That doesn’t mean things weren’t bad.

                      I look to what we could be, not rest on the laurels of how much better we are than x years ago.

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                    • …and I never said we’re at the bottom of the slag heap in the World. Among First World OCED nations, though? Eh, we’re probably in the bottom third when all things are considered.

                      (This is by the way when a conservative in most political threads will run in and say, “but everybody wants to come to America!”

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                    • Well, RTod’s argument seems to be that unless you preface every argument about the lack of economic mobility with, “but ya’ know, things are way better in 1853 and all things considered, it’s not that bad”, it is with the undertone of ‘it’s not so bad, quit complaining.’

                      Or maybe I’ve just read too many conservatives make the ‘we have HDTV’s and iPod’s now, so the fact private sector pensions don’t exist anymore is no big deal’ and I react Pavlovian to arguments close to it.

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                    • I look to what we could be, not rest on the laurels of how much better we are than x years ago.

                      This is a benign statement as far as it goes. I would even agree with it in certain applications. With respect to innovation or productivity, let’s not rest on our laurels—sally forth! But if we are to say let’s not be satisfied with the level of welfare and government intervention in markets and let’s have more of it, that’s quite another matter.

                      Now, the observation that so many people have iPods and HDTVs and cheap travel and food and so forth is not meant to suggest some people still don’t have things tough. But it does prompt the question raised in the post, why should liberalism adopt income inequality as its defining issue, as Krugman does? Income inequality has not prevented a rise in prosperity in absolute terms, and quite possibly, it contributed to that rise.

                      If there is an injustice, then, one should be careful not to take aim at wealth, but at breakdowns in political and other bargaining processes. And yes, some of those breakdowns benefit the wealthy.

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                  • Sorry about jumping in the middle of this conversation, but it seems like the best place to put in my two cents. First, I would like to say that the give and take between 14 and 31 is one of the reasons I hang around this place.
                    I am an old guy and would like to give a couple of examples of my wages during the years. In 1966 I had a very menial labor job at a plant in Wisconson that paid 32.43 in todays wages, plus there was insurance and vacations.
                    In 1981 I worked as a driller in the oil field and my wages per hour were 46.95 adjusted for inflation, plus medical, and 100% dental after three years. Also, I got the equivalent of $58 dollors per diem for expenses.
                    Today, I am a highly skilled craftsman, at least I think I am, and can make at most 20.00 per hour with no benefits.
                    I don’t know enough history to know if FDR’s program lengthened the depression, but since my moma had the good luck to be born in southern Oklahoma in 1926 I have heard many a story about FDR’s projects and how good they were for the locals. I also know that unlike many other countries we did not turn to totalitiaranism and when WWII started the people believed in America. Plus,we were powered up and ready to produce enough equipment to overwhelm the bad guys.
                    What it really boils down to in the is America better today than forty years ago, it all depends on your station. If you are one of the top earners, then things are much better. If you are on the left side of the economic bell curve, then things are not better.
                    Since I am on the poorer end of the spectrum, I have to say that the programs put forth by the Republicans don’t work for me. Plus, I am very much a social liberal, so I don’t see any reason to hope the right wing prevails.

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                    • Dexter,

                      Those details about your past wages seem to line up with Krugman’s figures in the book. However, I did not find that the book satisfactorily support the claim that the downturn was the result of alleged Republican racism and economic policy. In fact, I thought skill-biased technical change resonated better, along with the notion that the benefits of winning WWII began to level off after a time and domestic social conditions began to deteriorate.

                      I realize, of course, that no one can have a complete picture of what exactly were the effects of the New Deal or WWII, or what exactly caused relative economic conditions for the middle class to decline in the ’70s and beyond. Krugman gets a lot of ribbing from the right (commonly referred to as “former economist”), but I did expect a more serious explanation from him.

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                    • Tim: “Income inequality has not prevented a rise in prosperity in absolute terms, and quite possibly, it contributed to that rise. ”

                      I’ve never seen a good empirical argument that income inequality contributes to growth, aside from the trivial (and out of range) case of zero inequality probably stunting growth.

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                    • “I don’t know enough history to know if FDR’s program lengthened the depression, …”

                      Anybody who says that either hasn’t looked at a basic chart of economic shrinkage/growth in the 1930’s, or is lying.

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                    • Anybody who says that either hasn’t looked at a basic chart of economic shrinkage/growth in the 1930?s, or is lying.

                      Barry, lighten up.

                      What I’d like is to see you post a comment talking about the shrinkage/growth in the 1930’s, linking to graphs, and explaining what we’ll see in the graphs.

                      I think that this will do much more good for the conversation than accusations of either ignorance or malevolence.

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                    • Anybody who says that either hasn’t looked at a basic chart of economic shrinkage/growth in the 1930?s, or is lying.

                      Or trusts the Tobacco Institute to determine whether cigarettes cause cancer.

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        • Well, this may just be to say that poor historical arguments are … poor. Another kind of poor argumentation is hyperbole (e.g., “the country and its policies have been an unsuccessful failure over the past 70 years”), and still another kind is simplistic reduction of one’s opponent’s arguments to mere hyperbole (e.g., implying that critiques of the New Deal and its legacy amount to the above quote).

          That said, I take your point that these and other examples of bad arguments can be found on both left and right.

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          • Then let me put it another way…

            Not considering myself an R or a D, it seems pretty obvious to me that the years since the New Deal have shown us two things: 1. government intervention can have very positive outcomes for the country, and 2. too much intervention or badly designed government intervention can lead to poor outcomes. This observation doesn’t seem especially radical, and seems as self-evident as it does simplistic.

            But I see both sides arguing ferociously that the above is bunk. It’s either the Krugman’s pointing out (correctly) that the New Deal led to some positive things and concluding (incorrectly) that that means additional government regulation is always the answer. And vise versa with the other side.

            Like I said, that’s not trying to evaluate history. That’s trying to use words in a clever manner and take certain hand-picked historical facts and manipulate them to bolster your political ideology.

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            • And so you would conclude that anyone who doesn’t agree with what “seems pretty obvious” and even “self-evident” to you is some kind of ferocious, duplicitous, manipulative radical, left or right? Come on. As an example of centristic, “plague on both your houses” moderation, this seems like irony verging on parody.

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              • No. I would say that to not see that you would need to put ideology over objectivity.

                Take safety regulations, which is a thing I deal with professionally. A generation and a half ago, if you were building a skyscraper the rule of thumb was one death-per-story was the goal to shoot for. Today a single death is almost unheard of. This has nothing to do with technology; most of the techniques used today were readily available back then. The difference has been government intervention, making it against the law – at the expense of the owner’s wallet – not to have minimum safety standards.

                Now, is there anyone in the building industry (including owners) that thinks we should go back to having no safety regulations, or that returning to a body-a-story rule of thumb would be good? If so, I’ve never met them. But I also don’t know anyone in the building industry, including union shop guys, that don’t feel like some (or many) safety regulations are inefficient, ineffective, cumbersome, overly expensive and made by people who work in an office that have no idea how the things that they are regulating work.

                Now, you can make an ideological argument that all government regulation is bad and so there should be no safety standards, or you can make an ideological argument that all government safety standards should not be questioned and should be constantly added to because the government wants to help people… but why would you do either of those things?

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                • RTod,

                  Interesting about the body-a-story rule. It’s a good illustration.

                  One of the reasons I wanted to explain the Progressive movement in detail is because it helps to demonstrate the connection between liberalism and conservatism. Everyone knows the connection between conservatism and libertarianism (the economic freedom/anti-business regulation angle), and there has been more talk in recent years of the connection between liberalism and libertarianism. But it seems to me there is not much talk about the connection between conservatism and liberalism, even though they are both movements that propose to reflect human values through the law.

                  So back to the skyscraper illustration, I would say that this is more a problem for libertarians than either liberals or conservatives. Though again, conservatives have tended to de-emphasize the legitimacy of economic regulation for reasons both political and theoretical (i.e., based on skepticism toward infringements of economic rights).

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                  • Thanks, Tim. Good poinst.

                    I confess, though, that the more I continue trying to decide exactly what kind of political label best suits me, the more I am toying with the idea that political labels are inherently destructive, and steer us to make bad choices that are irrational at best or abhorrent at worst.

                    Just something I’m trying to work out, I guess.

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                • I think you’re mixing up “ideology” with some kind of simple-minded absolutism. It’s certainly true that there are simple-minded absolutists around, of all political stripes, but it’s simplistic itself to try to equate them to anyone with a more principled or general idea of social/political issues. “Ideology” itself is a term frequently invoked as a bad thing by people who like to think of themselves as “common sensible”, “practical”, “pragmatic”, and the like. But the Keynes quote is peculiarly apt here: “Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.” Or worse.

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                  • > It’s certainly true that there are
                    > simple-minded absolutists around,
                    > of all political stripes, but it’s
                    > simplistic itself to try to equate
                    > them to anyone with a more
                    > principled or general idea of
                    > social/political issues.

                    I dunno, it seems to me that the “more principled” political thinkers all have the same major weakness in their train of thought.

                    It’s one thing to have a political framework that, if applied consistently and correctly to its own internal rules, would work. Hey, that’s actually not hard at all. Hell, if you apply only the internal rules of a political framework to itself, Communism works. Libertarianism works. Conservativism works. Liberalism works. Liberaltarianism would work. Even Anarchy would work.

                    But so what? In the real world, you cannot apply only the internal rules of a political framework to itself. Liberals can’t have regulatory oversight with a guaranteed benign overseer: regulatory capture *happens*. It’s actually inevitable. Libertarians can’t have a truly free market. Koz can’t wish away the Democrats and run the economy only by his own principles.

                    When you have competing agendas, if your own political framework *cannot* account for this, your political framework utterly lacks double-loop learning. It ignores a basic reality of human sociopolitical systems.

                    That’s pretty damn broken. And generally speaking, the “more principled” you get, as a political thinker involved in a framework, the less able you are to deal with this broken bit.

                    But hey, maybe that’s just me.

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                    • If you’re saying that we can’t have a perfect system, or utopia, then fine, I agree. If you’re saying that we can’t improve over what we have — though I don’t think you are — then I simply disagree. But if you’re saying that we don’t need or use some kind of “political framework” to help guide what constitutes improvement, whether consciously or unconsciously, then I think that’s a mistake, and would again note the Keynes quote re: defunct economists.

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                    • > If you’re saying that we can’t
                      > have a perfect system, or
                      > utopia, then fine, I agree.

                      That’s not exactly what I’m saying, but that follows trivially. I’m not sure, but I’ll go out on a limb and say nobody that comments regularly on this blog is going to believe that utopia is possible, let alone probable.

                      > If you’re saying that we can’t
                      > improve over what we have
                      > — though I don’t think you
                      > are — then I simply disagree.

                      No, I’m not saying that either. And it doesn’t precisely follow. It is, however, a very probable outcome in any given snapshot in time.

                      That is to say, I highly suspect that what we’re looking at is an oscillating function that trends better over historical time. At any given point in time, things can be *way* worse than they have been before, but if you compare any given decade to a given decade of 100 years ago, you’ll see some measurable improvements. This of course depends on everyone agreeing one what you’re measuring and what constitutes improvement. If you’re looking at the entirety of human condition, I think you’re looking at an even greater distance of time to get measurable improvement: a lot of any one given society’s internal improvement comes at externalizing some of their suck to somebody else, and everybody’s been great at that since travel by ship was invented.

                      > But if you’re saying that we don’t
                      > need or use some kind of “political
                      > framework” to help guide what
                      > constitutes improvement, whether
                      > consciously or unconsciously,
                      > then I think that’s a mistake

                      No.

                      Here’s what I’m saying. Godel was right, and not just about mathematical systems. You cannot have a framework which relies upon a finite series of axioms that is complete, concise, and correct.

                      Most pure-thinker political theorists get stuck, sooner or later, with a practical problem. The practical problem is that their political theory relies upon axioms which are not universally held to be true. Indeed, roughly half of everybody else strongly disagrees with the axiom.

                      You cannot reason that out with your opponent. If a person does not believe that an individual has a inherent right to privacy, any policy I propose that depends upon that principle cannot be sold to that person (at least, not on that basis).

                      I can keep beating my head against that rock, it ain’t movin’. Me standing there arguing that the other person is an idiot or is incapable of seeing the light isn’t moving that rock, either. In fact, instead of showing myself to be the intelligent thinker in the room, it shows me out to be a fishing moron for thinking that everyone ought to agree with me.

                      Most political argument I see boils down to people ignoring the fact that the guy they’re arguing with *does not hold, in common, the same axioms that they do*.

                      Every once in a while I see arguments between two opposing sides that can get past that, but shake my head because they’ve decided to reframe their discussion along axioms that they invent and can hold in common… but then they forget that those aren’t necessarily going to be agreed upon by everyone else, either.

                      One of my core complaints with Libertarianism, for example, isn’t the average one of “How do we get there from here” (although that’s a major secondary complaint, to be sure). It’s “How do you account for the fact that humans gather up into groups, and nefarious humans leverage transitive trust and group apathy to bequeath upon themselves great power that cannot be stopped by your decentralized society?” I look at the course of human history and I see one credible stab at a reasonably libertarian society, which was internally consistent for quite some time, and eventually fell apart because the Vikings kept raiding their ass. The only way to get rid of ’em was for Brian Boru to become High King. Nobody’s successfully wonked out a workable libertarian government since, and given the social testing ground that is aggregate human societies, that leads me to strongly suspect that there’s a fundamental weakness with libertarianism similar to the fundamental weakness with communism: it requires a fairly closed system with internally consistent rules to work, and we’re not getting that on this planet of 6 billion.

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                    • Pat:

                      Re: If you’re looking at the entirety of human condition, I think you’re looking at an even greater distance of time to get measurable improvement:,

                      see, e.g., this: http://www.youtube.com/watch?v=jbkSRLYSojo

                      Re: Godel, review the distinction between the logical and the empirical. No one I know of is talking about ” a framework which relies upon a finite series of axioms that is complete, concise, and correct” in political/social systems.

                      Re: your apparent belief that political discussion/debate is futile, a) I wonder why you bother arguing here, and b) I think the very fact of political/social change, which comes about in part through the process of just such exchanges, refutes it.

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                    • Oh, and I left out a re: historic stabs at “libertarianism” (small-l) — I think the advent of capitalist/bourgeois society since at least the early 18th century was the first significant one, and it achieved a great deal, including the abolition of the age-old and world-wide practice of slavery, and the slow spread of literacy, democracy, and the rule of law. Not to mention the generation of wealth in quantities amounting to a flood or fountain rather than a trickle. It didn’t carry the label “libertarian” of course, simply because the word “liberal” hadn’t yet been subverted by the collectivist reaction.

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                    • Larry

                      > No one I know of is talking about
                      > ” a framework which relies upon
                      > a finite series of axioms that is
                      > complete, concise, and correct”
                      > in political/social systems.

                      Really? Gee, I see that all the time. Dressed up in common language, of course.

                      How many times have you heard someone (whether you agree with them or not) say to you, “If it weren’t for (them), this would work”?

                      > Re: your apparent belief that political
                      > discussion/debate is futile,

                      Oh, no, it’s not futile. It does often times seem that way, but among the hundreds of windmills you occasionally wind up tilting at an actual dragon.

                      > a) I wonder why you bother arguing
                      > here

                      One, because my own political philosophy is not entirely formed. By engaging in both inductive and deductive argument, I can find out new ideas that I don’t currently have encapsulated in my own noggin, and also occasionally find areas where I hold two conflicting and contradictory principles, and thus try to resolve that conflict. Both of these things are good for me, no?

                      Also: some of these chaps can write.

                      > b) I think the very fact of political
                      > /social change, which comes
                      > about in part through the process
                      > of just such exchanges, refutes it.

                      Megh. I see almost all long term political/social change as a consequence of economic growth and technology, not political discourse. When the new becomes ubiquitous, norms change.

                      Political discourse doesn’t do much. Just witness the fact that people are still talking about the Founders and Adam Smith. While the Founders and Adam Smith had valuable things to say and I’m not denigrating that by any means… that was the current k-nowledge… uh, quite some time ago.

                      Can you imagine if the cutting edge of a scientific field was still actively discussing things from the turn of the last century? It would be considered an impossibly backwards field. This at least suggests that political thought progresses significantly slower than most other fields of study. Attributing society-wide successes or failures to that seems a weak link, to me.

                      > I think the advent of capitalist/
                      > bourgeois society since at least
                      > the early 18th century was the
                      > first significant one, and it
                      > achieved a great deal, including
                      > the abolition of the age-old and
                      > world-wide practice of slavery,
                      > and the slow spread of literacy,
                      > democracy, and the rule of law.

                      Er… the abolition of the world-wide practice of slavery happened in the early 18th century?

                      The slow spread of literacy has come about with the rise of post-agrarian economies; I think there’s a much more credible linkage between “I no longer have to work 18 hours a day to not die” (hunter-gather to early agrarian) to “I can work 16 hours a day and my family can not just survive but flourish” (mid-agrarian to early-industrial) to finally, “Hey, the workers need to be able to read in order to be able to grok stuff more complicated than ‘pick the heads of lettuce and put them in a box’ or ‘pack the boxes that come down the conveyor belt onto the pallets'” (mid-industrial to now).

                      Put another way, if a supervolcano erupted and plunged the world back into the stone age, the survivors would probably largely if not completely lose literacy within a generation. Nobody is going to be learning how to read if it takes all your time to get enough raw resources to survive, even if your parents and grandparents come from our politically enlightened present.

                      Progress isn’t led by politics.

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                    • I see almost all long term political/social change as a consequence of economic growth and technology, not political discourse.

                      Economic growth and technology are abstractions — somebody/ies have to translate those into actual political/social change, and political discourse and action is where the rubber meets the road.

                      Politics isn’t physics, by the way. Never mind the Founding Fathers, we’re still talking about Plato and Aristotle — but as the context changes so does the discourse.

                      As for those “post-agrarian economies”, not to mention the “early-” and “mid-industrial”, did they just happen to coincide with the appearance of capitalism and the rise of so-called bourgeois society? I don’t think so.

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  5. Jesse, Elias and Larry (and anyone else I suppose):

    As I said earlier, I’m not a skilled writer and I think this is the reason why I don’t seem to be making my point very well. So let me take a breath and at least try one more time.

    The point I have been trying to make is that I think we might (all of us) have our ideologies force us into making incorrect assessments of reality, which leads us to making bad policy decisions. (And Larry, before start typing objections to my holier-than-thou snark know that I include myself in this as much as everyone else.)

    The jumping off point I used in this case was the New Deal. Conservatives often point to the New Deal as the turning point, when our once prosperous and thriving nation was high jacked and sent into a ruinous tailspin that led to near universal poverty. (This is an exaggeration of what conservatives say, of course, but I would argue it’s not a huge one.) The problem with this argument is that while your politics might say that since the New Deal we have been in steady financial decline, the reality says not so much. I later used a common complaint that “Reaganomics also fiscally destroyed our country” as what I view as ideological mirror image of the New Deal hand wringing. In either case the separation of theory and reality seems self-evident. Now, I am not arguing that we are a perfect nation, that things could not be better or that other countries might have developed solutions to problems that we might be wise to learn from. And I am certainly not arguing that we should just stand pat and accept our lot. I am arguing that if the proof of ideology is that this country is on the verge of economic collapse and starvation solely because of the New Deal or Reaganomics then you need to go back to the drawing board and find better proof.

    I’d also argue that this mindset has real consequences for real problems. I’ll take one of the only biggies that I can speak with any authority to show you what I mean.

    Our healthcare system as it is just is not sustainable; healthcare costs are rising exponentially, and have been for decades. And there are a number of deeply ingrained reasons for this, which means any potential solution that actually works is going to be complicated and (at least for some) painful. And since the problem is only going to get worse, addressing it in a meaningful way now would be a good time. But I would argue that political ideology, and the way it warps our sense of reality, is currently making this impossible.

    If you are on the right, your ideology says that no government is good, and that what we’ve always had is good. This leads to laughable denial on the right, with claims that “there is no problem” or – despite it being so easily disproven – that other countries spend tons more than we do on healthcare. Any potential solutions have to tackle only previously approved villains, which is why the right insist despite all evidence to the contrary that sticking it to the trial lawyers will solve all of our healthcare problems.

    If you are on the left, your ideology says that anti-corporatist stances can fix the problem. This leads to creating a system that looks to vilify insurance companies and bring in government regulation. Which is all fine and well, but that government regulation does nothing to curb the cost increase curve of healthcare. (To its credit it does force healthy people to buy insurance, which should temporarily drive down insurance premiums. But if costs continue to increase exponentially at 7-10% a year, we’ll be back where we started soon enough.)

    The truth, however, is that regardless of what your ideology is, sticking it to either insurance companies or trial lawyers (or both) doesn’t solve your problem. Neither does eliminating government, or a government takeover – unless either of those can be made to address the real problem: exponentially rising costs. All of these things are solutions that ignore the problem at hand, but focus on the boogy man the ideology wants to blame. And I do not think that this comes from people cynically deciding to exploit a problem; I think that our ideologies are forcing us to reshape reality into a narrative that reinforces our politics.

    And I’m arguing that getting to a place where reality informs our politics would be a good thing.

    I know in advance everyone here will disagree with my thoughts here, but I’m hoping they’ll at least have a better idea what they are disagreeing about.

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    • RTod,

      I like your comment; it gives a good sense of your approach to political problems. Here is an off the cuff thought: True, political theory/principles are necessarily going to get in the way of getting things done. Thus, at times, theory/principles are going to seem undesirable or unenlightened or even immoral if they purport to stand in the way of helping people — e.g., in the healthcare debate.

      But theory and principle are ultimately all that separate us from despotism. To the extent that political wisdom and nuance escape articulation in law, we are forced to choose between the rule of law for the rule of pragmatism. No one ever said law was the most efficient ruler, only the most legitimate.

      With respect to healthcare, believe it or not, I oppose the individual mandate not because I oppose Obamacare. I oppose them both for independent reasons (and some overlapping ones). I don’t even oppose the individual mandate because I believe the government does not have the authority to require me to purchase healthcare. I believe the *federal* government doesn’t have this authority. The state is another matter. This is why I have no problem with Romneycare. And it is why it disappoints me that so many Republicans do have a problem with it.

      Now, maybe a state socialized system of healthcare is better than a private one; and maybe a national socialized system is better than a state one. Those are pragmatic questions. As a matter of what our system of government is currently constitutionally authorized to do–rather than politically what it might be able to get away with—I oppose Obamacare and its national mandate.

      So, rambling aside, I think the point is that government must satisfy that people that it acts both pragmatically and legitimately. This is usually a very difficult balancing act.

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      • No one ever said law was the most efficient ruler, only the most legitimate.

        I think the point is that government must satisfy that people that it acts both pragmatically and legitimately.

        But by saying that the ACA is ‘illegitimate’, you’re already looking at the issue thru an ideological filter, no? I mean, let’s be clear here: there is no mandate to buy insurance. There is a tax imposed on those who don’t have insurance justified by the commerce clause and the taxing powers of the federal government, which is established law. To claim that the ACA is illegitimate means that much of 20 century legislation is also illegitimate. Which in turn renders the word ‘illegitimate’ meaningless unless it’s understood – and here’s we’ve come full circle – in an ideological context.

        Oh, and excellent post, btw.

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        • stillwater,

          I think I understand what you mean, so let me make my position a bit clearer. I am a constitutional originalist. Not because I believe the original public meaning of the words of the Constitution will always lead to the best results, and certainly not because I think it provides the best blueprint for national governance in the 21st century. I am a constitutional originalist because that is the only approach to the Constitution that gives faithful effect to the democratic-republican process that enacted it into law, and thus the only approach that can appropriately give that document continued legitimacy.

          With that said, viewing the mandate under the lens of constitutional originalism, the mandate is clearly invalid. True, the commerce clause has suffered the death of a thousand cuts, and it is difficult to say exactly when we broke from an originalist approach to its application. (If not before Wickard, however, then that case most assuredly delivered the mortal blow.)

          Does this all mean that “much of 20 century legislation is also illegitimate”? Yes, I believe it does. That doesn’t mean the discussion has suddenly turned ideological, however, unless I’m unwilling to admit that even laws I might like are illegitimate under the same standard. But I am willing to admit they are.

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  6. RTod: I’m not a skilled writer and I think this is the reason why I don’t seem to be making my point very well.

    I think your writing is fine, RTod (at least as good as mine) — I’m just arguing over what I think is a mistake in your point against so-called “ideology”.

    I am arguing that if the proof of ideology is that this country is on the verge of economic collapse and starvation solely because of the New Deal or Reaganomics then you need to go back to the drawing board and find better proof.

    So, for example, here I’d agree with you. But I think you’re misunderestimating (so to speak) the arguments against the New Deal, or, for that matter, against Reaganomics.

    And I’m arguing that getting to a place where reality informs our politics would be a good thing.

    Agreed, again. Given that, let’s try to look with fresh eyes at the New Deal and its legacy. We might find that once we let go of the hyperbolic claims of some of its cruder antagonists and supporters we can start to build a more nuanced and critical understanding of it that can help illuminate some of our current issues as well. That, to my mind, would simply come under the heading of learning from history or experience.

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  7. “Liberalism appeared somewhere in the sixteenth century—“St. George, in the guise of Rationality,” as Kenneth Minogue puts it—to slay the dragons of despotic kingship and religious intolerance. Centuries later, liberalism slew the dragons of slavery, poverty, and later “the inert scaliness of privilege, vested interest, or patrician insolence.””

    It would seem from these examples that Liberalism can be defined simply as a historical drive toward egalitarianism and/or equality. The right of members in a society to not be ruled over by those who would set themselves up as their “betters”.

    Question: Is that still a worthwhile “cause”, or has that fight been fought, won and rendered irrelevant requiring, necessarily, Liberalism’s extinction?

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    • The continued existence of poverty and a top-heavy power structure, not to mention we’re still trying to figure out what exactly equality should mean, suggests that it’s extinction is neither required nor necessary.

      But might it feel less urgent to many? Perhaps. Fascinating question.

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    • I rather think liberalism, historically, has been associated with the drive toward individual freedom or emancipation. The association with equality had to do with freedom from the legal constrictions of a class-ridden feudal society, and was focused on equality of status as opposed to a forced equality of substance.

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    • Jazgar,

      Early liberalism fought for political equality, which is something quite different from fighting for income equality or near-equality. To the extent income equality is inevitable in a relatively free society, and to the extent modern liberalism doesn’t actually want or succeed in bringing about a totalitarian state, modern liberalism’s task would never be finished.

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      • “Early liberalism fought for political equality, which is something quite different from fighting for income equality or near-equality. ”

        Money was/is/always-will-be political power. I honestly don’t see how you can separate the two.

        Yes, there’s a natural tension between democracy and free markets, the former tends to cause distribution of wealth while the latter tends to concentrate it. Without a safety valve, at what point does too much of one trigger a massive backlash in the other?

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  8. I think I have a related example that may (or may not) be related but could draw some parallels to income inequality. In principle, I would say that most of us would probably agree that it’s important to respect people’s property rights and let them be free to make decisions about their own property. But what if everyone owns cars that release lots of NOx and VOC into the atmosphere that cause photochemical smog and ozone pollution? These pollutants reduce the ability of people especially those that are very sensitive (such as asthmatics or those with allergies) to fully use their most valuable property, their bodies. In that case, to what extent should the state violate the property rights of one group of people (car owners) to help maintain the property rights of another group (asthmatics) by say requiring catalytic converters that increase the cost of cars so that less people can afford them? (or any other measure such as ozone days etc.) This might not be the best example, but trying to uphold the principle of property rights in this case is not so clear cut or simple.

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  9. In response, liberal columnist and economist Paul Krugman proposes in his book, The Conscience of a Liberal, that liberalism be defined by a commitment to preserving and extending the objectives of the New Deal.

    The first thing that I notice about this definition is how provincial it is. The New Deal doesn’t mean all that much to the rest of the world.

    Also, which parts of The New Deal are we talking about here? The New Deal could be construed to include hundreds of separate policy initiatives, some almost everyone would accept were good ideas, almost everyone would accept were bad ideas, with quite a few in the middle.

    It sounds more like Krugman trying to signal affiliation to modern US liberals than a serious attempt at political philosophy.

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      • This, I think, is a good point and pretty closely parallels why libertarians were upset by the Metcalf piece on Nozick. One should keep in mind the purpose of a book or of a particular point in a book before criticizing it. It’s quite unfair to rip a book or an argument for failing to serve a purpose or prove a point it was not intended to serve or prove.

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        • Mark,

          Krugman says flat out: “I believe in a relatively equal society, supported by institutions that limit extremes of wealth and poverty. I believe in democracy, civil liberties, and the rule of law. That makes me a liberal, and I’m proud of it.” (Emphasis added.) Of these purportedly defining traits of liberalism, Krugman devotes the entirety of his book to discussing income inequality. He does not engage in any substantial discussion on democracy, civil liberties or the rule of law. Thus, the “purpose or point” Krugman’s book was “intended to serve or prove” was, by its own terms, to establish how the campaign against income inequality “makes [one] a liberal.”

          I’m pleased that there seems to be some agreement that Krugman failed in his task. But that should not make it “unfair” of me to say so and to give reasons why. Thus, I strongly disagree with your comparison of my review to Metcalf’s piece on Nozick. I also think it uncharitable toward Nozick to compare him with Krugman.

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    • Well, to be fair, Tim’s next sentence broadens the definition a little: “Specifically, Krugman’s liberalism is principally concerned with the task of reducing wealth inequality. ” Which I think also explains which parts of the New Deal we’re talking about.

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      • And to those who didn’t get it, Krugman’s (not very long) book focused on what he saw as a major thing. It’s not an Encyclopedia of the New Deal and What Should Be Done. He ain’t Rand :)

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        • True. Again, what Krugman’s book and my post focus on is the liberal argument against income inequality. To that end, if anyone can recommend some other works that make the case better than Krugman, I’d be interested in checking them out.

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  10. I haven’t read the entirety of the comments yet, so my apologies if I repeat anything. But, that being said, while I find Krugman to be absurdly polemic in his writing (and I have read this book), I also think the U.S.’s income inequality is, when compared to other developed nations, unacceptable. I mean, of course income and living standards have improved in absolute standards, but that doesn’t change the fact that average wages haven’t changed as much as needed to match the basic cost-of-living (esp. of ever-rising health care, gas, tuition costs). That seems disingenuous to argue that poorer folks should quit complaining because they would be rich in Bangladesh, which conveniently ignores that their wages, while higher in absolute terms, are eroded against the cost of neccesities in America; a homeless person is a homeless person is a homeless person. I would also posit, contrary to Tim’s claims, that social mobility is weaker in America than other developed nations: “Parental income is a better predictor of a child’s future in America than in much of Europe, implying that social mobility is less powerful…those born to black middle-class families are much more likely than their white counterparts to fall in rank. The children of the rich and poor, meanwhile, are less mobile than the middle class’s. More than 40% of those Americans born in the bottom quintile remain stuck there as adults (The Economist 4/15/10).” On top of that, executive compensation (quadrupled since 1970, while bottom 90% pay has stalled) has helped contribute to this outsized income gap too, as the Washington Post reported on a few weeks ago: “According to the CIA’s World Factbook, which uses the so-called “Gini coefficient,” a common economic indicator of inequality, the United States ranks as far more unequal than the European Union and the United Kingdom. The United States is in the company of developing countries — just behind Cameroon and Ivory Coast and just ahead of Uganda and Jamaica.”

    So what am I even trying to say? I guess that, while Krugman is ignoring the natural shift from a industrial to a services economy, not to mention the rise of the developing world, he at least reminds us that other countries have mitigated this shift more equitably without turning to outright socialism or, for that matter, sacificing much GDP growth. I would never set specific goals for what exactly our ideal gini coefficient would look like, but I think policymakers can at least return to Clinton-era tax rates for those earning 250K and up, achieve a semblance of universal health care (in a way that takes the insurance burden off businesses, leading to higher wages instead), end unwarranted tax loops (home mortgage interest deduction for upper class folks), expand the EITC, and changes the incentives on exec. comp culture, amongst other novel ideas.

    Anyway. Thought-provoking piece, Tim. The history you went over was great, but I still believe our country’s leaders shouldn’t give short shrift to our inequity.

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    • Krugman’s popular writings are polemics. That is what they are trying to be. I suppose it’s possible for a polemic to be so successful that it just becomes absurd how successful it is as a polemic. But you’d have to explain to me why I should have a low opinion of something that succeeds to an absurd degree at being what it is trying to be. Unless of course, that is, PK happens to be making bad arguments or untrue assertions in the course of his polemics. But that would be an entirely different criticism than that his polemics are polemical.

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      • Good point. I guess we’re talking semantics here, but I am referring to the way in which Krugman writes: “right wing conspiracy” “without voter suppression George W Bush would not have made it to the White House” “Madison, Wis., is looking a lot like Baghdad in 2003, with government officials exploiting fiscal crises for fun and profit (2/25/11)” His 1/9/11 column that basically insinuates Repubs were responsible for Gabby Gifford’s shooting… Not to say that Krugman’s economic arguments are weak, though they lean toward simplicity for the sake of continuity. Only that he presents them in a partisan and vitriolic manner that goes beyond what other left-leaning economists have done.

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