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Arts and Culture

Zachary Karabell on ‘The Case for Big Government’

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Posted on Feb 20, 2009
book cover

By Zachary Karabell

With Congress passing a nearly $800 billion spending and tax-cut bill and with the Federal Reserve taking trillions onto its balance sheet, we are if nothing else plunging into a new era of big government. The extent of these actions would have been unthinkable even six months ago, and the scale of these measures—as well as the fact that they are probably the first of many—has taken many by surprise. Even those who have been advocating for years that the federal government play a more active role in addressing economic imbalances and inequalities could not have predicted or imagined what has happened of late.

It is both Jeff Madrick’s fortune and misfortune to have “The Case for Big Government” published in this climate. Madrick has for many years been a voice crying in the wilderness. His essays in The New York Review of Books in particular have been acerbic and astute critiques of the absurd and glaring inequities of modern American laissez-faire capitalism. Some of the current spending plans, as well as the ideological shift in Washington away from the dogmatisms of the past, are a vindication of much of what he has been championing for years.

 

book cover

 

The Case for Big Government

 

By Jeff Madrick

 

Princeton University Press, 224 pages

 

Buy the book

 

Unfortunately for his book, however, events have somewhat overtaken him. While it’s likely that Madrick prefers reality to have changed even at the expense of his book sales, he is nonetheless a victim of timing. One obvious indication that events have overtaken his argument? He makes an impassioned case for government spending of 3 percent of GDP a year on a variety of social, employment and infrastructure programs, which would amount to about $400 billion a year. A year ago, that was a bold call that even he knew would be met with skepticism and resistance. Today, it is half of what Congress has just authorized.

Still, even though government spending has increased, it’s unclear that public attitudes about government have changed much. As Madrick notes, the past decades have been defined by “an ideological antagonism toward government.” While that was cemented most notably by Ronald Reagan, it became even more ingrained under centrist Democrats led by Bill Clinton, who famously declared the end of the era of big government. Yet, says Madrick, the central tenet of the anti-government argument—namely the belief that government impedes economic growth—has never been proved.

“If the case made that big government is detrimental to economic growth is as simple and unambiguous as some economists and political commentators claim it is … the statistical evidence should be easy to demonstrate and virtually impossible to refute.” Madrick points to Western Europe as well as periods in U.S. history in which there has been aggressive government intervention to show that, indeed, the argument against government rests more on ideology than fact.

Of course, that doesn’t mean that more government in and of itself creates growth, a fact which Madrick acknowledges. Sometimes it does, sometimes it doesn’t. Madrick spends a considerable portion of his brief book showing that there never was a “laissez-faire” ethos in the United States and that government has always been woven into the economy, a fact that should be obvious. That said, he is perhaps too quick to dismiss the strong anti-government currents that have coursed through the American past. It has never been either-or, and in seeking to show how involved government has always been, Madrick risks supplanting one caricature with another.

The heart of his argument is that the rise of income inequality in the United States was intimately connected to the waning of government and its delegitimization by conservatives. Particularly troubling has been the economic fate of men. “The U.S. economy no longer raises the income of workers the way it once did … and has profoundly affected the fortunes and prospects of males.” Madrick goes on to cite a litany of statistics about wage stagnation over the past three and a half decades, statistics that are familiar talking points on the left and dismissed as sour grapes on the right, especially since overall economic growth has been steady during this time (at least until now).

The issue as Madrick sees it lies with the harm that wage stagnation and declining standards of living do for the American dream. He adamantly rejects the notion that things like cars and televisions are luxuries and makes an effective case that they are in fact necessities that are required for one to be a full participant in contemporary American society. Furthermore, amid yawning gaps between rich and poor and the insecurity that tens of millions feel because of soaring health care costs and tenuous wages, there has been “an erosion of faith in American fairness” which threatens to undermine society.

It’s hard to argue with the sentiment, but there is something, well, sentimental about that perspective. The notion of an idyllic American dream that has been undermined takes a brief moment of the 1950s when all seemed well with the world (except for those pesky McCarthyite witch hunts and fear of nuclear annihilation) as the set point for the American psyche. It is not, and while the belief that the future will offer more growth and more affluence than the present was ingrained for part of the mid-20th century, it has not always been so clear or simple. Some Americans—especially immigrant groups defined by religious creed—looked to America as a land where they could worship unmolested by government, not as a place where their children would enjoy more material prosperity.


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By DAveKnTux, June 15, 2009 at 4:36 am Link to this comment

“We would have to change our corporate laws to value the welfare of people above profits, that would be a cost of doing business. With global warming upon us, we need to be able to reduce our consumption without causing starvation or stagnation.”

totally agree with this comment, reducing pointless consumerism relies upon a total shift in ideology.

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By Anarcissie, February 23, 2009 at 6:20 am Link to this comment

BigIslandDave:
‘Your “I’m a rugged anti-government individualist and the hell with everybody else” theme is wearing thin, Anarcissie. ...’

My ideas are not going to wear at all unless somebody engages them.

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By christian96, February 22, 2009 at 8:30 pm Link to this comment

Does our Government worship God or money?

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By BigIslandDave, February 22, 2009 at 9:21 am Link to this comment
(Unregistered commenter)

Your “I’m a rugged anti-government individualist and the hell with everybody else” theme is wearing thin, Anarcissie.

Though I must credit your cogent marshaling of thoughts in well-wrought sentences. Not usually typical of Republican-conservative-libertarian types.

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By Anarcissie, February 22, 2009 at 8:24 am Link to this comment

TheRealFish:
’... If the “government” is “of the people, by the people, and for the people” as Mr. Lincoln reminded us, that “government” is us. U.S. is US. ...’

I don’t know about you, but I am not the government.

A good example of democracy in action was the Great Bailout bill.  Many congresspersons reported receiving mail 100 to 1 against it.  They voted for it anyway.  That should tell you something, although if you didn’t know it already, you probably can’t be told.

As I’ve pointed out before, Republican small-government talk is empty propaganda.  Reagan actually expanded the government.

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By No Shineola, February 21, 2009 at 11:22 pm Link to this comment

What does it take to give a homeless man shelter?
What does it take to make a child’s belly full?
What do you spend to make a sick man healthy?
What is the cost to provide a school?
What is the price to put clothes on your back?
What is the point of speaking to a fool?

Governments deed is to provide for our needs
not to watch us bleed.

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By Anarcissie, February 21, 2009 at 9:46 pm Link to this comment

No Shineola:
‘The words stand on their own. Guaranteeing food shelter clothing health care and education are self evident.’

Not to me.  Want me to list the varieties of food, shelter, clothing, health care and education which are available?  It will be a rather long and variegated list.  Shelter, for instance, covers everything from a refrigerator box under a bridge to a 100-room mansion.

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By christian96, February 21, 2009 at 7:30 pm Link to this comment

When a company falls on difficult times,  one of the
things that seems to happen is they reduce their staff and workers.  The remaining workers mus find
ways to continue to do a good job or risk that their
job would be eliminated as well.  Wall streetk, and
the media normally congratulate the CEO for making
this type of “tough decision”, and his board of
directors gives him a big bonus.
OUR GOVERNMENT SHOULD NOT BE IMMUNE FROM SIMILIAR RISKS:

Therefore:
(1) Reduce the House of Representatives from the
current 435 members to 218 members.
(2) Reduce Senate members from 100 to 50(one per state)>
(3) Then, reduce their staff by 25%.
Accomplish this over the next 8 years(two steps/two
elections) and of course this would require some
redistricting.

SOME YEARLY MONETARY GAINS INCLUDE:
$44,108,400 for elimination of base pay for congress.
(267 members X $165,200 pay/member/year.)
$97,175,000 for elimination of their staff.(estimate
$1.3 Million in staff per each member of the House,
and $3 Million in staff per each member of the Senate
every year.)
$240,294 for the reduction in remaining staff by 25%.
$7,500,000,000 reduction in pork barrel ear-marks
each year. (those members whose jobs are gone.
Current estimates for total government pork earmarks
are at $15 Billion/year.)
The remaining representatives would need to work
smarter and improve efficiencies.  It might even be
in THEIR BEST INTERESTS TO WORK TOGETHER FOR THE
GOOD OF OUR COUNTRY!
We may also expect that smaller committees might
lead to a more efficient resolution of issues as well.  It might even be easier to keep track of what
your representative is doing.
Congress has more tools available to do their jobs
than it had back in 1911 when the current number of
representatives was established.(telephone, computers, cell phones, to name a few.)
NOTE:
Congress did not hesitate to head home when it was
a holiday, when the nation needed a real fix to the
economic problems.  Also, we have 3 Senators that
have not been doing their jobs for the past 18+
months(on the campaign trail) and still they all
have been accepting full pay.  These facts alone
support a reduction in Senators and Congress.
SUMMARY OF OPPORTUNITY:
$44,108,400 reduction of congress members.
$282,100,000 for elimination of the reduced house
member staff.
$150,000,000 for elimination of reduced Senate
member staff.
$59,675,000 for 25% reduction of staff for
remaining House members.
$37,500,000 for 25% reduction of staff for
remaining Senate members.
$7,500,000,000 reduction in pork added to bills
by the reduction of Congress members.

$8,073,383,400 per year, estimated total savings.
(that’s 8-BILLION just to start!)
BIG BUSINESS does these types of cuts all the
time!
If Congresspersons were required to serve 20, 25,
or 30 years(like everyone else) in order to
collect retirement benefits, TAX PAYERS COULD
SAVE A BUNDLE!  Now they get full retirement
after serving only ONE term.

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By No Shineola, February 21, 2009 at 5:45 pm Link to this comment

The words stand on their own. Guaranteeing food shelter clothing health care and education are self evident. It is up to the branches of government to implement. This is why I believe it should be a grass roots movement, coming from the people. It is the opposite of prohibition. It is a can do versus a not do. It can be implemented.

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By TheRealFish, February 21, 2009 at 3:43 pm Link to this comment

A “simple” comment, really: When Reagan (and all the other pro-corporatocracy class warriors on the right or left) mouth the words, “the government is not the solution to the problem—the government IS the problem,” the logic behind those words need more scrutiny than the emotional, gut-level populist reaction uttering those words tends to draw.

In other words, take two steps back, pause, then think about what Reagan and all those others are really saying:

If the “government” is “of the people, by the people, and for the people” as Mr. Lincoln reminded us, that “government” is us. U.S. is US.

If WE are the problem and you claim to be the problem solver, then you are against US.

The Reagan Revolution was indeed a revolution. Against us. Mr. Reagan and others of his anti-American ilk are very honest in that they admit they do not like the form of government that is “of the people, by the people, and for the people.”

They preach that there is only a special class of “us” from whom all blessings flow. Give over the country’s wealth to this small cadre of special people, get the huddled masses to step out of the way, and the promise is that we will get some little trickle of wealth from On High, the bits that seep between their greedy fingers.

We’ve now tried that method for 28 years, and we see the results all around us. Big Government is BIG, when it is a 300 million person government.

And yes, Teddy Roosevelt was very correct in his many discussions of the true meaning of “commonwealth.” The wealth of the country belongs to every man, woman and child citizen of the country, not just those glorious few whom Reagan and others worship.

Those glorious few entrepreneurs grow fat on the largess of the commonwealth, and as TR insisted, owe a very large debt to the commonwealth for the privilege of capitalizing on our common wealth.

To be anti-government, especially in a government of the people, by the people, and for the people, literally means you stand against the underlying principles of the United States.

Operating on that basis, when taking the most broad view, is treason; preaching this anti-government spew that has been made to be populist dogma is just as easily viewed as sedition.

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By Anarcissie, February 21, 2009 at 12:10 pm Link to this comment

Perry—the Republicans did not make the government smaller in recent years, they enlarged it significantly.  You have only to look at the budget figures, the Federal deficit, the activities of the Federal Reserve Bank, and the huge expansion of military and police activity to figure this out.

However, a few years of history probably don’t prove very much one way or the other.  I am more interested in your conviction that human societies can’t exist without governments, that is, permanent institutions of forcible coercion.  You seem to find them almost a biological necessity, although humans existed without them, as far as we know, for many millennia.  Or, given the (to me) improbable principle that human beings cannot function without a gun being held to their heads, why these institutions should not at least be minimized.  I hope you have more evidence and better reasons than the Republican small-government propaganda hitherto cited.

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By Anarcissie, February 21, 2009 at 11:44 am Link to this comment

I’m asking you how you would write the positive obligations you’ve named into the Constitution.

In the Constitution before the 13th Amendment, slavery was permitted and accommodated, but it was not required or mandated.  No one was obliged to keep slaves, nor was the government commissioned to supply people with slaves.  However, you’ve mentioned several positive obligations, like the supply of food, housing and health care, and I’m curious as to how you’d put them into the Constitution in a meaningful way, remembering that the contents of the Constitution are obligatory and very difficult to change.  Note that there is already a “general welfare” clause which has been there since 1787.

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By no shineola, February 20, 2009 at 11:47 pm Link to this comment
(Unregistered commenter)

Slavery was allowed under the constitution until it was amended. I don’t see the problem. The founders understood that the document would be changed over time.It is time for some changes.

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By Anarcissie, February 20, 2009 at 7:52 pm Link to this comment

No Shineola—I believe I understand the sort of economic structure you’d like to see.  However, I don’t see how you would fit it into the Constitution.  The Constitution actually compels very little; it’s mostly about the structure of government, and what the government is allowed and isn’t allowed to do.  It says that Congress can pass laws for the common defense and to promote the general welfare, but it doesn’t have to.

Suppose the Constitution mandated a set of benefits, but the government had gone broke.  It has happened before, even to governments.  What then?

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By No Shineola, February 20, 2009 at 5:09 pm Link to this comment

Anarcissie

Reorganizing our tax priorities would be the way to go.
There would be a guaranteed base for each individual. Regulated capitalism would still exist. We would have to change our corporate laws to value the welfare of people above profits, that would be a cost of doing business. With climate change upon us, we need to be able to reduce our consumption without causing starvation or stagnation. The idea of a base could be imported to nations around the world. FDR had a similar idea in the 1930’s. It wasn’t implemented. It is time for a new deal for the 21st century.

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By Perry Logan, February 20, 2009 at 3:32 pm Link to this comment
(Unregistered commenter)

“The enlargement of the government in a country is probably a pathological condition.”

On the contrary, a bias against goverment is almost certainly a pathological condition.

Since some form of government is necessary to any society, being anti-government is like hating your own internal organs.  The Republican Revolution was based on anti-government bigotry, and it has come a cropper bigtime.

Fortunately, most Americans now understand the need for more goverment in a technological, highly populated society.

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By Anarcissie, February 20, 2009 at 1:47 pm Link to this comment

No Shineola:
‘There needs to be a grass roots movement to create a constitutional amendment guaranteeing food, shelter, clothing, health care and education for all Americans.’

All right, but then the Constitution probably needs to specify how these things are to be obtained.  They come ultimately from labor, and if no one wants to supply them voluntarily the government will presumably be required by the Constitution to use force to obtain them.  At present, however, the 13th Amendment prohibits involuntary servitude, so there seems to be a possible contradiction there.  However, I’m open to suggestion.

A second difficulty is that the quantity and quality of “food, shelter, clothing, health care and education” are thus far unspecified.  In the past, for instance, many states guaranteed education to the children in their jurisdiction, but contrived to not provide very much to those who were poor or improperly pigmented.  So this is something the new amendments to the Constitution would have to address if any constructive effect were going to be obtained from them.

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By Gerald Sutliff, February 20, 2009 at 12:46 pm Link to this comment
(Unregistered commenter)

Good read.  IMHO we’ve too much resentment and not enough thoughtful evaluation of what works.

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By No Shineola, February 20, 2009 at 12:37 pm Link to this comment

There needs to be a grass roots movement to create a constitutional amendment guaranteeing food, shelter, clothing, health care and education for all Americans.
There needs to be a minimum base for humanity that cannot be changed by the greedy among us.

Pass this and all other progressive initiatives will fall into place.

Mr Madrick is correct in his analysis. We just need to be bolder.

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By Anarcissie, February 20, 2009 at 12:20 pm Link to this comment

The enlargement of the government in a country is probably a pathological condition, corresponding to the enlargement of the heart in an overstressed animal body, presaging early disease and death.  In the case of the United States, two motivations combine to produce this excessive stress: the desire of the ruling class to extend empire in the face of bankruptcy, and the desire of those in and outside the ruling class to drive the economy as hard as possible to produce the stuff the common people have been promised in place of freedom, equality, peace, a liveable physical and social environment, and some time off.

What I find truly sad in all this is the pathetic celebrations of this degenerative process by many who call themselves liberals, leftists or progressives, even as the halter is tightened around their necks and the lash is laid to their backs.

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By Smoove, February 20, 2009 at 10:27 am Link to this comment
(Unregistered commenter)

Mr. Karabell has a classic example of a dictator complex. He thinks his version of big government will work exactly as he prescribes it.

Even if one could devise the perfect economic plan, their is zero chance that plan would remain intact as it passed through the house and senate.

“I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them.”
-Thomas Jefferson

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