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Towards a Second Era of Good Feelings

Thoughts on “American Challenges: The Blue Model Breaks Down”

n Saturday night, May 21, 2011, The John Batchelor Show (broadcast from AM 770 in the City and heard in the Albany, NY area on AM 1300) devoted the program to reactions to an article by Bard College professor Walter Russel Mead called American Challenges: The Blue Model Breaks Down (http://blogs.the-american-interest.com/wrm/2010/01/28/american-challenges-the-blue-model-breaks-down/) by several John Batchelor show contributors, such as Dr. Michael Vlahos (of the Naval War College and author of the influential book on the Global War on Terrorism. Fighting Identity) and John Fund (of The Wall Street Journal editorial page).  Mr. Mead’s thesis is:

Here in the quiet precincts of the stately Mead manor in exclusive Queens, as the dew gently falls over the mist-shrouded lawns and the pigeons coo soothingly from the historic-landmarked eaves, it is sometimes hard to believe, but out there in the workaday world the long and graceful decay of the American social model is accelerating into a more rapid and dangerous decline.  The core institutions, ideas and expectations that shaped American life for the sixty years after the New Deal don’t work anymore, and the gaps between the social system we’ve inherited and the system we need today are becoming so wide that we can no longer paper them over or ignore them.

Call this the blue model, and the chief division in American politics today is between those who think the blue model is the only possible or at least the best feasible way to organize a modern society and want to shore it up and defend it, and those who think the blue model, whatever benefits it had in the past, is no longer sustainable. That division is going to begin to erode in the next few years because the blue model is breaking down so fast and so far that not even its supporters can ignore the disintegration and disaster that it entails. (emphasis added)

What Mr. Mead, interviewed on the program, could not identify is what would replace this social model that has held sway in the United States since at least the New Deal, and possibly since the progressive Era of 100 years ago.  The erudite Dr. Vlahos stated that he saw a threat from the rising income inequalities that accompany the end of the Blue Model, similar to the ones that lead to the decline of the Dutch Republic, the French Monarchy and even the Czarist Regime in Russia.

In this essay, I will suggest that the Blue Model was, in fact, a serious digression from the founding economic and political concepts of our country and that the fall of this model will lead to return to the fractal distribution of power between the Federal government ( a government of limited powers, supreme within that limited ambit), the states and the people.  I will also suggest that the collapse of the Blue Model means the end of the Democrats as any kind of a viable, national political party, a process not dissimilar to the end of the Federalist Party and the subsequent “Era of Good Feelings” in the aftermath of the War of 1812, almost 200 years ago.  Finally, I will suggest that the end of the Democrats as a viable political party probably presages a schism in the Republican similar to that which produced the Whig Party in the 1820s.

RED STATES, READ NATION

Then-Senator Obama was right when he said in his 2008 Victory Speech in the Iowa Caucus, “We are not a collection of Red States and Blue States.”  The electoral map of the United States in the 2010 Mid-term elections clearly identifies the United States as a nation of Red States, some of which have Blue Catchment areas sufficient to elect a Democrat to state-wide office.

Many of these Blue catchment areas are becoming less blue.  New York City, as the Jonathan Mahler’s 2005 book, Ladies and Gentlemen, the Bronx Is Burning ( http://en.wikipedia.org/wiki/Ladies_and_Gentlemen,_The_Bronx_Is_Burning), demonstrates was (as late as 1977) a Far Left city, with a generally Far Left government.

That Far Left city has not elected a Democrat Mayor since 1993.  Gov. Andrew Cuomo, probably the only Democrat politician under age 65 with a positive (or any) national reputation other than Pres. Obama, has essentially governed like a Republican, appearing to be more the political son of New Jersey’s Chris Christie than of his own father, Gov. Mario Cuomo, one of the Liberal Lions who contended unsuccessfully for the mayor’s office in New York City in 1977, as recounted in Mahler’s book.

Why this change?

Because the ideas of the Left did not work.  The unworkable, ungovernable catastrophe New York City was in 1977 furnished definitive evidence of that failure and facilitated the election of the fiscally conservative to moderate Ed Koch, who created the foundation for today’s more business-friendly New York City.  Additionally, at the national level during the same period, Keynesian Stimulus, intended to balance out the business cycle, as partially implemented by the Republican President Richard (“We are all Keynesians now”) Nixon, had brought the nation by the late 1970s to a period of high inflation and low growth reminiscent of Great Britain after World War II or, increasingly, the United States today.  The Stagflation of the 1970s paved the way for the Age of Reagan.

The unfortunate part of this is that the Blue Model runs quite counter to the founding ideals of our Republic.  Men like Madison (and, especially, Hamilton) wanted a stronger central government than existed under the Articles of Confederation, but they did not want a unitary Republic.  Their overriding goal was to create a federation of sovereign (but not independent) states, with a Federal government of limited powers, but which would be supreme within that limited ambit.  As Madison wrote in Federalist No. 45:

The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the State governments are numerous and indefinite.

As President, Madison consistently vetoed “internal improvement” projects (such as roads and canals), even though he often favored them on pragmatic grounds as beneficial projects, because he did not believe that the federal government had the power to get involved in such things.  There were principled disputes over the limits of Federal power in the early Republic and views did change.  For example, Madison, who opposed the First Bank of the United States, chartered the Second Bank for reasons that roughly paralleled Justice Marshall’s “necessary and proper” reasoning in McCulloch v. Maryland (1819). However, the overarching understanding was that Federal power was limited.

We have become, because of unfortunate and lawless court decisions, like U.S. v. Butler (1937), which chose to credit Justice Story’s Commentaries on the Constitution over Madison’s Federalist in deciding that a separate spending power existed, more of a de facto unitary republic.  However, Rep. Ron Paul’s 2008 Presidential Campaign, and the burgeoning Tea Party/Liberty Movement that sprang from it, have caused people to look at the legitimacy of programs like Social Security and Medicare, which (in addition to being Constitutionally questionable) are in impending financial collapse.  (As they were, as many people do not remember, during the last major down turn in the early 1980s).

We are, in short, a Red Nation, because we have seen the lack of  workable (even any) ideas in the modern Democratic Party.  We have become more conservative in response to an Obama Administration and a 111th Congress dishing up the failed gruel of Keynesian Stimulus, attempting to solve a debt crisis with more debt, with predictably dire results.  We are a Red Nation because we have READ our founding documents and the works of our Founders and Framers and wish to return to first principals.

FREE MEN, FREE MARKETS, FREE PULPITS OR WHY THE MORMON CHURCH MATTERS

What will replace the failed Blue Model? I think the following ideas, drawn from old and tested concepts, are critical to the new paradigm:

1. If the 20th Century, from Lochner, through Griswold to Roe v. Wade, was the century of the Civil War Amendments, the 21st should be the Century of the Ninth and Tenth Amendments.

2.  The great, looming realities of the 21st Century are: 1) we will have to compete for foreign capital with everyone else; and 2) we will have a less affluent population and a slower rate of growth.  Ever see those commercials for investment in Macedonia on Fox and CNBC?  They are the competition.

3.  These two constraints mean: 1) we will have to have to allocate a lower percentage of our GDP to government to attract investment; and 2) we will probably have a shrinking tax base in any event.

4.  There will, however, be needs that will have to be met and investment rarely comes to unstable nation-states or to those without a properly educated work force.

5.  The key to dealing with items 3 and 4 above are the Ninth and Tenth Amendments.

6.  The Federal Government needs to shrink, performing only its Constitutionally enumerated powers, as Madison believed it should, even though this is not the current state of the law.

7.  Things like Education, properly a State (or, better, a local) function, would be returned to that level and the Federal Education Department could be eliminated.  Something new needs to replace the current model of property-tax-funded, free, universal K-12 public education.  We need as many incubators as possible to develop best practices.  This is the epitome of Brandise’s view of the states as the “laboratories of democracy.”

8.  Universal health care could be pursued through legal reform and the establishment of not-for-profit buying cooperatives/association health plans.  Instead of creating a centralized government bureaucracy like the DMV (or continuing the current employment-based system), Americans should get their health insurance through competing not-for-profit groups like USAA.  The Federal Government, post Iraq and Katrina, does not have the legitimacy to make hard choices in this immensely personal area.

9.  If this proves successful, Social Security and pensions could be privatized on a similar model.

10. National defense is a (perhaps “the”) critical function of government but it does not require continuing to buy weapons for the Cold War.  More money, time and effort need to be given to State and USAID.  The Department of Defense needs to think, not only about the current war(s), but the next.  This would best be done through investing in the development and honing of the Military’s current stable of exceptionally experienced Officers and NCOs.  Why not try to make them all McMasters and Nagles?  GEN Peterus’s exceptional brain trust in Iraq  needs to become the norm, not the exception.

11.  The Troop Program Units (“TPUs”) of the Army and Air Force Reserves should be reassigned to the states.  State National Guards and Militia ought to be capable enough to handle a disaster at the Hurricane Katrina level on their own.  If these forces are deployed in Federal service, there should be Inter-state compacts that handle the issue.  As a result, FEMA should be stood-down, saving money and decentralizing disaster response and recovery.

12.  Returning Education to the States and allowing individuals to come together to solve common problems though voluntary organizations and the “Social Sector” is not only more efficient, it is more resilient, an issue identified by thinkers as diverse as Tocqueville, Drucker, Ramo, Robb, Joe McCormick and the Transpartisans and William Lind.

In short, we must realize that the decentralized, fractal distribution of power between the Federal government, states and people created by the Constitution is a far better approach to today’s decentralized world than the centralized, bureaucratic Blue Model of the last 100 years. We must realize that the self-reliant and communitarian values of the Second Great Awakening, represented by the Church of Jesus Christ of Latter Day Saints (the “Mormons”) who are a veritable Asimov’s Foundation of these values. The Mormon’s highly regarded social welfare system can create a model for the emergence of an effective Social Sector as the Federal Government extricates itself from the business of Entitlements.

After disgrace over private sexual misconduct ended his brilliant career as Secretary of the Treasury, Alexander Hamilton became one of the most successful lawyers in the State of New York at the turn of the 19th Century.  He did this, not by being brilliant, but by returning to first principals and applying them to an increasingly complex world of inter-state and even inter-national commerce and markets.

To thrive, probably even to survive, in a global and interconnected world, our country has to return to its own first principals, returning to being a nation of free men, free markets and free pulpits.

SOCIAL INEQUALITY OR WHY AYN RAND MATTERS

Some say that the end of the Blue Social Model will increase already common social inequality and some say that will have a corrosive impact on the nation.  I disagree, in part because of the writings of Ayn Rand, a naturalized American citizen, who saw something in American culture and character what many of us who were born here do not.

I am no fan of Objectivism, Rand’s “philosophical” movement.  It is, in my opinion, contradictory and pseudo-intellectual.  As a writer, many critics maintain she was a talented purveyor of pulp fiction, as popular in the 1940s and 1950s for her depictions of beautiful, hard women in bright red lipstick being ravaged by Randian Übermenschen as for her “philosophy.”  (I’m as interested in the concept of  beautiful, hard women in bright red lipstick as the next mensch,  Über or otherwise, but that alone is not art, for either Rand or her contemporary, Mickey Spillane.)
However, like most novelists who are remembered, Rand saw something in human nature (or at least the American character) that was true and pure and often ignored.  Rand saw how important the entrepreneur was, not only to our economy, but to our culture.  She also saw that Americans understand that those who are truly talented should be truly rewarded and that we do not have the social and economic jealousies that burden other societies.

In the beginning of the film Patton (1970), George C. Scott delivers a speech as George S. Patton in which he states:

When you were kids, you all admired the champion marble shooter, the fastest runner, big league ball players, the toughest boxers. Americans love a winner and will not tolerate a loser. Americans play to win all the time. I wouldn’t give a hoot in hell for a man who lost and laughed.

This is why the average American does not resent the winners in the “winner take all society.”  This is why Atlas Shrugged is again atop the best seller list and the talk of the young.  This is why most of us, even average schlubs like me, are not offended by the very able people in that novel opting out when they were kept from striving.

We, in short, understand two things as Americans:

1)  as the great Milton Friedman said, “There is no such thing as a free lunch,” you get paid for what you contribute; and
2)  you have to let the fast horses run.

Most of us, plumbers and carpenters, CPAs and lawyers, have jobs because there are people who can pay for the services we offer.  Most of us benefit from what the brilliant scientists and software developers and artists create and are entertained  by the striving of the most talented actors and athletes.  We do not resent these people because we know what these people do and how much more talented they are than we are.  Once we understand just how rare the talents are that make a great hedge fund manager (and how perishable they are) and what importance they have in keeping, for example, pension plans secure, we do not resent them either.

We do resent those whose talents do not merit the rewards they receive however.  As Mr. Mead states in his essay:

First, voters simply will not be taxed to cover the costs of blue government.  Voters with insecure job tenure and, at best, defined-contribution rather than defined-benefit pensions will simply not pay higher taxes so that bureaucrats can enjoy lifetime tenure and secure pensions. Second, voters will not accept the shoddy services that blue government provides.  Governmental is going to have to respond to growing ‘consumer’ demand for more user-friendly, customer-oriented approaches.  The arrogant lifetime bureaucrat at the Department of Motor Vehicles is going to have to turn into the Starbucks barista offering service with a smile.

While demagogue Democrats try to stir up bad feelings about “stagnant” real wages, most of us understand at some level:

1) most of the productivity gains of the last 18 years or so have come from technology (computers, etc.), hence capital, and not labor;
2) that when productivity was stagnant from the early 1970s to the early 1990s, we continued to get pay raises we mostly had not earned;
3) this fueled the Great Inflation of the 1970s and CANNOT be repeated; and
4) most of us are a cost and add little and what we do add is fungible.

If we ourselves do not have the talent and the work ethic to be Henry Ford or Bill Gates (or, for that matter the recent Jamaican immigrant who opens the patty place or the Chinese immigrant who opens a buffet), we instinctively admire those who do.  They work for themselves.  Their success or failure is on their own terms, contingent on the interplay of their talents and flaws.  It is something that resonates in the American heart and Rand, in the depths of the age of The Organization Man and The Lonely Crowd,  understood that.

In short, most of us are smart enough to know that, if you like light at night and cooked food, you should root for Prometheus and not the eagle, or rather, the vulture.

THE NEW ERA OF GOOD FEELINGS

In their roman-a-clef play about the Scopes Monkey trial, Inherit the Wind, Jerome Lawrence and Robert E. Lee’s H.L. Menken figure, E.K. Hornbeck, says of COL Brady (a thinly disguised William Jennings Bryan):

Time was when Brady was the hero of the hinterland. Waterboy for
the great unwashed. But they’ve got inside plumbing in their heads
these days. There’s a highway through the backwoods now, and the
trees of the forest have reluctantly made room for their leafless
cousins, the telephone poles.

Alas, this is the impending fate of  a Democrat Party entwined with old and failed ideas. The travails of Representative Weiner are illustrative of this point. As a political insider  told NY Post columnist Andrea Peyser, part of why Weiner has not yet resigned is that he is unemployable: he has never worked in the private sector (http://www.nypost.com/p/news/national/having_kid_is_not_one_of_the_steps_LROunpWHrWFBlphCWjct7N/1). All he knows is the Blue Model, that is anathema to productivity and achievement.

Some see hope for the Democrats in the young and in our growing African American and Hispanic population. That hope is gravely misplaced.

Immigrants from the global South often come to the United States and Great Britain seeking greater economic and, especially, entrepreneurial opportunity than their own nations’ version of the Blue Model provides, as illustrated by Nigerian-British Economist Dambisa Moyo (http://www.guardian.co.uk/books/2011/jan/16/west-lost-dambisa-moyo-review). Given the almost unimaginable tax impact of the collapsing Blue Model on the young, I can’t see that demographic staying with the Democrats by 2016, as this issue becomes more plain. While the Democrats present themselves as friends of the poor, as Meade points out in a recent Blog (http://blogs.the-american-interest.com/wrm/2011/06/07/fanniegate-gamechanger-for-the-gop/) on Gretchen Morgenson’s Reckless Endnagerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon, the benefits of these programs often go to the rich and connected while the poor bear the inevitable burdens.

As weak as the current Republican presidential field is, I see little confidence in Team Obama.  Like George H.W. Bush, President Obama is an able, decent, cerebral and dispassionate man . . . one admired but not loved.  As George H.W. Bush discovered, a President who governs in hard economic times (that are not improved by his policies seasonably) needs to loved (as FDR was) to be re-elected.  I suspect this Administration will likely be cut short at one term by someone who may not even be in the race yet, or someone being derided, as  Clinton was in 1992, as one of the “Seven Dwarves.”

When you think of Republicans with national reputations under the age of 65 or so, the list is long: Ryan, Jindal, McCotter, Gibson, Bachmann, DeMint, Rubio, Rand Paul, Perry, Hailey and Walker, to name a few.  Outside of Pres. Obama, there is only Gov. Cuomo as a creditable, youngish national Democrat politician, and Cuomo is credible only to the extent that he governs in derogation of the Blue Model.  By 2016, I think the death of the Democrat Party will be clear even to the pundits.

However, by 2022 or so, I would suspect that Republicans will schism.

My guess (at this point, it can’t be more) is that one wing will follow Rep. Ron Paul’s idea that perhaps even the Constitution went too far and that it had the seeds within it that spawned our current Federal Leviathan.  Others, while wanting to strictly construe the “necessary and proper” clause, will be more content with something closer to the 19th Century view of Federalism.  I also think that there will be a schism between those who favor austerity as an intrinsic value and those who see it as the key to renewed economic growth.  Finally, I think there will be a schism between those who favor laws that facilitate the development of what Peter Drucker called the “Social Sector” to replace the Blue Model and those who think this should not be done by government, certainly not at the Federal level.

However, in either case, these views are more effective and more natural to this polity that the Blue Model that went before.  I agree with Mr. Mead that trying times approach.  As with the days of the Founding and the Framing, as with the time of the Civil War, as in the time of the Second World War, these times will also ask us for that which is best in our nature and to strive and risk for what we believe in and think is right.

As one of those people who had the honor of being recalled by the Army after a long break in service for a year (in my case spent reasonably uneventfully in the Horn of Africa), I do not doubt for one moment that the young Marines, Airmen, Soldiers and Sailors I saw serving in the days after 9-11 and their generation, the people one regimental commander called “the new Greatest Generation,” are not ready to better the world, no matter what the cost.  They have done this for the last ten years.  Instead, it is now time for Boomers (like myself) to do what we have never done before: to give up blind self-interest for the sake of doing the right thing.

(A version of this blog first appeared in the Albany Times Union Tea Party Voices Blog.)

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