from Mises.org:
Hayek's Road to Serfdom: Despotism Then and Now
Mises Daily: Friday, June 25, 2010 by Thomas J. DiLorenzo
"Every economy has its contradictions …. What counts is results, and there can be no doubt that the Soviet planning system has been a powerful engine for economic growth." — Paul Samuelson, Economics, 1985 edition
"Contrary to what many skeptics had earlier believed, the Soviet economy is proof that … a socialist command economy can function and even thrive." — Paul Samuelson, Economics, 1989 edition
"The Road to Serfdom was 'inaccurate innuendo about the future'." — Paul Samuelson, 2009
When Friedrich A. Hayek published his classic book, The Road to Serfdom, in 1944 he was loudly denounced by academic statist apologists in England, where he resided at the time, and in America. In the preface to the 1976 edition of the book Hayek noted that a prominent philosopher even denounced the book despite admitting that he had not read it! But average citizens did read it. The book was a gigantic success in America, quickly selling over half a million copies. Millions of copies of a condensed Reader's Digest version of the book were also sold and widely read.
The court historians in academe were not concerned about Hayek's age-old warnings about the dangers that centralized political power posed to liberty and prosperity, for they intended to be beneficiaries of that power as well-paid advisers to the state. Millions of average citizens were not as enthusiastic, especially Americans who, during the war, had experienced oppressive and confiscatory taxation, the slavery of military conscription, government-imposed product rationing, pervasive shortages of basic staples, and endless bureaucratic bungling.
Hayek's motivation for writing The Road to Serfdom was the shocking speed at which so many Europeans — especially in Germany — had simply forgotten all that they had learned over the centuries about the virtues of a free society, the need for limitations on government power, the dangers of centralized power, and the workings of capitalism as a worldwide network of mutually advantageous exchange. It only took a couple of decades of socialistic sloganeering to persuade Germans to abandon their classical-liberal roots and embrace Big Government of the worst sort.
Hayek was deeply concerned that the same despotic ideas were also becoming more and more popular in England, America, and in other countries. As the above quotations of MIT's Paul Samuelson demonstrate, much of America's educational "elite" was enamored with Soviet communism and central planning. Samuelson even went so far as to say in his textbook, which was by far the biggest seller of its day, that "it is a vulgar mistake to think most people in Eastern Europe [during communism] are miserable."
The parallels to today's world are unsettling, to say the least. Perhaps this is why, a few weeks ago, The Road to Serfdom ascended to #1 in sales on Amazon.com after Glenn Beck discussed the book on his Fox News Channel program. There may not be a Hitler on the horizon, but the extent to which governments all over the world have simply ignored the lessons of the past in response to the economic crisis that they created with their own monetary policies and other interventions is mind boggling. The US government, in particular, responded to the bust portion of the Greenspan Fed's boom-and-bust cycle with the most economically destructive — but politically centralizing — policies: trillion-dollar bailouts of failing corporations that will create moral-hazard problems the likes of which have never been seen; an escalation of the money supply that dwarfs the monetary inflation of the Greenspan Fed; the Soviet-style nationalization of automobile companies, banks, and much of the healthcare industry; government regulation of executive compensation; the appointment of dozens of dictatorial "czars" with unaccountable power to regulate and regiment myriad industries; trillion-dollar-a-year deficits; an expansion of the powers of the Fed (!); and a president who believes he has the power to fire corporate executives, nationalize industries, and send unmanned "drone" bombers to any country in the world on a whim.
Washington DC no longer recognizes any limits at all to its powers to "socially plan" all aspects of American life. This totalitarian impulse is not limited to national politics. The mayor of New York City believes he has the power to regulate all of the eating and drinking habits of New Yorkers, even including how much salt they consume with their meals and what type of soft drinks they can enjoy.
The subtitle of the 1976 edition of The Road to Serfdom, published by the University of Chicago Press, is "A Classic Warning Against the Dangers to Freedom Inherent in Social Planning." The exponential explosion of governmental powers in response to the current, government-generated economic crisis makes The Road to Serfdom as relevant today as it ever was (as Glenn Beck's audience instinctively understands). This is why the Mises Institute is offering a special five-week online class, The Road to Serfdom: Despotism Then and Now, under my direction through the Mises Academy, beginning on Monday, July 5. The course will be an in-depth examination and discussion of Hayek's analysis, its relevance to today's world, and how such ideas can be used to put America — and other parts of the world — back on the road to freedom.
Hayek's insights were remarkable, and remain so to this day. He understood and explained the power of ideas: European fascism could never have been adopted without a 25-year propaganda campaign against individualism (basic respect for the individual), classical liberalism, and free-market economics. He pointed out the "fatal conceit" of believing that government bureaucrats could "plan" an entire society. He explained why socialism — including its fascist variant — meant little more than "equality in restraint and servitude." "Marxism has led to Fascism and National Socialism," he wrote, "because, in all its essentials, it is Fascism and National Socialism [i.e., Nazism]."
Hayek saw through all the rhetorical tricks and gimmicks of the socialists of his day, one of which was the constantly repeated refrain that socialism and government "planning" was "inevitable"; therefore, it is futile to oppose it. Nor did he fall for the gimmick of wrapping totalitarian socialism in the mantle of the god of democracy. Government planning is inherently incompatible with both democracy and the rule of law in the long run, he explained, and leads to some degree of economic dictatorship. Any business person who has had to deal with the dozens of federal, state, and local government regulatory agencies knows that "economic dictatorship" is a key feature of the current American political system.
"The worst" always rise to the top of the political heap under a regime of government planning, Hayek explained, for they are the ones with the least qualms about brutalizing their fellow citizens and depriving them of their liberties. All of this can only be sustained by what Hayek called "The End of Truth," or the effects of massive government propaganda that demonizes the civil society, individualism, and the system of peaceful voluntary exchange and private property (capitalism), while glorifying all aspects of the state.
The purpose of this course, The Road to Serfdom: Despotism Then and Now, is to educate students about these contemporary dangers and arm them with the intellectual ammunition that they will need to oppose them and champion freedom instead. The totalitarian socialists of the early 20th century understood that they could not succeed unless they first discredited the ideas of freedom. The only way to stop their intellectual descendants ("the totalitarians in our midst," as Hayek would call them) is to counter their totalitarian ideas. Hayek was a hero of society for putting his career as a renowned economic theorist on hold (for most of the rest of his life, it turned out) to lay out one of the most articulate arguments for a free society ever made. We must revisit and strengthen these arguments if we are to choose capitalism and freedom over socialism and serfdom.
Thomas DiLorenzo is professor of economics at Loyola University Maryland and a member of the senior faculty of the Mises Institute. He is the author of over a dozen books, including The Real Lincoln, Lincoln Unmasked, How Capitalism Saved America, and, more recently, Hamilton's Curse. Send him mail. See Thomas J. DiLorenzo's article archives.
Friday, June 25, 2010
The Collapse Of Western Civilization
From Free Republic and Israel News:
Decline and Fall of Western Civilization
Israel News ^
Wednesday, February 13, 2008
Daniel Greenfield
Posted on Wednesday, February 13, 2008 6:24:58 PM by MinorityRepublican
It is hard for most people to grasp and understand that they are living through the period of the decline and eventually destruction of their countries and their entire way of life, yet that is what we are seeing now.
The European continent, the core of Western civilization is collapsing. European birth rates have fallen below replacement rates, populations are dwindling and slowly being displaced by large foreign Muslim populations. Wedded to socialism Europe faces a generation in which the elderly and their social services will vastly outnumber a far smaller population of youth leading to economic collapse.
In a century Europe as it has been will be no more. Oh most of the cities will go on standing, some may even keep their former names but the majority of their Churches will become mosques, their streets full of Arabic and Turkic speech and their nations part of the Muslim world. For anyone who finds it hard to imagine Berlin, Paris, London and Brussels' fate, need only look at Constantinople, now Istanbul, once the center of a Christian Empire.
Anyone who wishes to envision how the Vatican will look in a century, need only glance at the Hagia Sophia, now a mosque. Take a look around Istanbul or Alexandria, your favorite European capitals will look just like them too. The Vatican will no doubt survive but the Pope will no longer be at Castle Gandolfo but in Costa Rica or Argentina with as much loot and art as the Papacy will be able to pry out of Rome before the hammer comes down.
Yet this will be less a Muslim conquest than Europe's suicide by defeatism, apathy and selfishness, a process that began after WW2. After all it wasn't the Muslims who forced Europe to abandon its colonies and then export millions of Algerians, Pakistanis and Turks as the cheap labor propping up the charade of socialism. It wasn't the Muslims who convinced Europeans that their own personal happiness took priority over everything else, that badgered them into having fewer children and waiting till they were in their late 30's to do it. It certainly wasn't the Muslims who made the average European provincially xenophobic and yet hopelessly defeatist at home and abroad.
The Muslims are indeed reaping the fruits of a conquest but it isn't their conquest but the conquest of Europeans over themselves. Europe whose armies conquered most of the known world, finally conquered itself. Two world wars and the brutal conflicts of two centuries hammered home to even the dimmest European the futility of nationalistic wars. Communism, liberalism and socialism only provided the intellectual justification for the obvious.
Discarding nationalism as anything more than a resentment of their neighbors and funneling the remnants of it into frenzied and furious displays of Soccer patriotism, Europe settled comfortably into its socialist twilight transitioning comfortably from its various industrial oligarchicies to post-industrial bureaucracies.
If Americans should wonder why Europeans can't seem to hold a soccer match without riots and fatalities, it's because soccer is the last vestige of a continent's militarism that once cost the lives of tens of millions. Living cushioned and imprisoned by a nanny state, soccer is the last vestige of manhood left to a continent of emasculated peoples. The people who once made revolutions, overturned monarchs and fought passionately for a thousand causes now live hollow regimented lives that occasionally erupt when they begin bashing each other's skulls in with stadium seats. The picture in Eastern Europe is no better. The birth rates in some Eastern European countries like Lativa are already on the verge of extinction.
Russia's birth rate problem which was a national secret under the Communists is secret no more and the Russian government is desperately trying to pay women to have children. Like Western Europe, the cities of the former Warsaw Pact nations are filled with foreigners. In a recent marketplace bombing in Moscow, the majority of the casualties were Chinese and other foreign nationals. While Russia engages in one last frenzy of Anti-Americanism becoming once again the arms dealer to the third world, the Slavs are dying out as surely as the Western Europeans. The only difference is the Western Europeans got the chance at a good life that Eastern Europe only received a small slice of.
The healthiest Western nations are the newest such as America and Australia but they too are marking time. The American birth rate is better than the European one but not by nearly as much as people think. The decline hasn't hit us as badly as Europe but all that means is give it more time and it will.
The spigot of immigration at the Mexican border is being turned up all the way by a Republican administration, not only in a quest for votes but because America has adopted much of the European socialist infrastructure that requires a constant incoming immigrant population to serve as the newest recruits in the MLM scheme of programs like social security. Corporations caring for nothing but profits outsource all the jobs they can and import Mexican immigrants to do the cheap and dirty labor they can't outsource.
America's industry is a passing dream and if the streets of American cities aren't populated by large hostile Muslim populations, that's only because Europeans have Arab speaking populations next door while we have spanish speaking ones. If Latino gangs proliferate in small towns and millions of illegals march around waving Mexican flags while demanding citizenship, like the Muslims in Europe they're simply playing the part of the Barbarians at the Gate while we do the work of burning Rome.
From America's birth, the country came with a vision of manifest destiny. When that vision was achieved and America dominated the world, a sheepish and small-minded leadership took a look around and began following Europe's path of national suicide. Devoid of a national destiny or a national goal, a nation becomes nothing more than a provider of services, a government the administrator of those services and its population perennially on the dole waiting for a handout. Once upon a time America had a vision of a glorious future, today no one can articulate a glorious vision for America.
Liberals prescribe more government programs and less national sovereignty in favor of international cooperation. Conservatives offer up doses of bible thumping and religion in public life. Neither address the simple fact that they have no national vision to offer. Neither the right nor the left is actually offering a vision of a future for America, all they're doing is wrangling over the terms of its dismantling.
Consumerism has instead stepped into the breach of vision promoting the pursuit of happiness living the shopping dream. Credit cards, ecommerce indebt people while a daily parade of gadgets, clothes, snacks and cars come packaged in audio, video, text and image promising that happiness is for sale. Without any overriding national goal or vision, all that remains is satisfying manufactured appetites for the output of the same companies that outsource the labor and push immigration in order to create those products at a profit in the first place.
While corporations tempt and dazzle the public with its products, the government leeches away ever income with new programs creating a bigger and bigger runaway bureaucracy. Governments no longer address problems so much as they bury them in paperwork, budgets and new departments. Even America's military capabilities become subservient to muddled political correctness. Is it any wonder that national pastimes like football and basketball have grown more and more thuggish parraleling Europe's impotent soccer riots.
What will America look like then in a century? It will like be a latin-american country in fact if not in name, little distinguishable from Brazil. As politics become more acrimonious and a large spanish speaking immigrant population pours in without a melting pot to melt into, North America will look like South America. And don't count the Muslims out either. Islamic and Arab influence in Latin America is rising. El Salvador has a Palestinian President. Argentina had a Lebanese one, when in collaboration with the authorities Iran carried out a large scale bombing there. A lot of the Spanish stars this side of the border like Selma Hayek or Shakira are actually the children of Lebanese immigrants.
What is the meaning of all beyond the obvious? Civilizations throughout history decline and eventually collapse. We're seeing that now all the more personally so, because it's happening before our eyes. Western civilization of the last six hundred years was an economic civilization living and dying by expanding trade, locating resources for production and exchanging them for manufactured goods. Everything from the colonization of America to WW1 was driven by it. Byproducts of that economic development gave us democratic societies, new countries and broad vistas.
Uncontrolled they also brought on destructive wars, destroyed countries gutting them from the inside eventually leaving nothing but nations of consumers buying products they no longer manufactured, of resources they no longer owned and even whose services and technical support had been outsourced.
Commerce is a river and in the hands of corporations whose CEO's care nothing except for cutting costs to edge out a profit margin this quarter before they're fired and move on to ruin another company, it's a river that flows to where it's cheapest. The very byproducts that created the wealthy and secure Western countries are the ones that insure the river flows away from them. The very technology they research creates greater opportunities for companies to outsource their employment. The Catch 22 is that it's the very things that have made the West successful that are killing it.
By the mid-20th century when the world was explored and conquered and superpowers gazed at each other across an atom bomb, greater ideals died. Nationalism, a thirst for exploration that had turned the world upside down for a century died out. In its place came a selfish existence in which people lived for new cars, mortgages and DVD players; while foolishly believing they were really living for themselves. Ideals were replaced by senseless radicalism. The first world grew fat and grey, never troubling their idyll in their consumeristic paradise to actually have children and plan for the future.
One can look at the coming extinction of Europe and call it the wrath of G-d, which it may well be. But inexplicable as it seems, it is really a civilization cutting its own throat through its small-minded selfishness.
The end, that much prophesied end, will indeed come with a whimper not a bang, unless we make a few bangs of our own. Great new beginnings are explosive ones. We still have the might to tackle great projects, a vast array of enemies gather around us and the stars above call to us.
We can embrace that future with a bang and refuse to go out into the darkness or we will indeed fall with the whimper of warehoused old men lying in cots while outside armed gangs loot and burn and the new caliphate flies its green and yellow flags above our cities.
Civilization is in our hands and the hour is nigh.
Decline and Fall of Western Civilization
Israel News ^
Wednesday, February 13, 2008
Daniel Greenfield
Posted on Wednesday, February 13, 2008 6:24:58 PM by MinorityRepublican
It is hard for most people to grasp and understand that they are living through the period of the decline and eventually destruction of their countries and their entire way of life, yet that is what we are seeing now.
The European continent, the core of Western civilization is collapsing. European birth rates have fallen below replacement rates, populations are dwindling and slowly being displaced by large foreign Muslim populations. Wedded to socialism Europe faces a generation in which the elderly and their social services will vastly outnumber a far smaller population of youth leading to economic collapse.
In a century Europe as it has been will be no more. Oh most of the cities will go on standing, some may even keep their former names but the majority of their Churches will become mosques, their streets full of Arabic and Turkic speech and their nations part of the Muslim world. For anyone who finds it hard to imagine Berlin, Paris, London and Brussels' fate, need only look at Constantinople, now Istanbul, once the center of a Christian Empire.
Anyone who wishes to envision how the Vatican will look in a century, need only glance at the Hagia Sophia, now a mosque. Take a look around Istanbul or Alexandria, your favorite European capitals will look just like them too. The Vatican will no doubt survive but the Pope will no longer be at Castle Gandolfo but in Costa Rica or Argentina with as much loot and art as the Papacy will be able to pry out of Rome before the hammer comes down.
Yet this will be less a Muslim conquest than Europe's suicide by defeatism, apathy and selfishness, a process that began after WW2. After all it wasn't the Muslims who forced Europe to abandon its colonies and then export millions of Algerians, Pakistanis and Turks as the cheap labor propping up the charade of socialism. It wasn't the Muslims who convinced Europeans that their own personal happiness took priority over everything else, that badgered them into having fewer children and waiting till they were in their late 30's to do it. It certainly wasn't the Muslims who made the average European provincially xenophobic and yet hopelessly defeatist at home and abroad.
The Muslims are indeed reaping the fruits of a conquest but it isn't their conquest but the conquest of Europeans over themselves. Europe whose armies conquered most of the known world, finally conquered itself. Two world wars and the brutal conflicts of two centuries hammered home to even the dimmest European the futility of nationalistic wars. Communism, liberalism and socialism only provided the intellectual justification for the obvious.
Discarding nationalism as anything more than a resentment of their neighbors and funneling the remnants of it into frenzied and furious displays of Soccer patriotism, Europe settled comfortably into its socialist twilight transitioning comfortably from its various industrial oligarchicies to post-industrial bureaucracies.
If Americans should wonder why Europeans can't seem to hold a soccer match without riots and fatalities, it's because soccer is the last vestige of a continent's militarism that once cost the lives of tens of millions. Living cushioned and imprisoned by a nanny state, soccer is the last vestige of manhood left to a continent of emasculated peoples. The people who once made revolutions, overturned monarchs and fought passionately for a thousand causes now live hollow regimented lives that occasionally erupt when they begin bashing each other's skulls in with stadium seats. The picture in Eastern Europe is no better. The birth rates in some Eastern European countries like Lativa are already on the verge of extinction.
Russia's birth rate problem which was a national secret under the Communists is secret no more and the Russian government is desperately trying to pay women to have children. Like Western Europe, the cities of the former Warsaw Pact nations are filled with foreigners. In a recent marketplace bombing in Moscow, the majority of the casualties were Chinese and other foreign nationals. While Russia engages in one last frenzy of Anti-Americanism becoming once again the arms dealer to the third world, the Slavs are dying out as surely as the Western Europeans. The only difference is the Western Europeans got the chance at a good life that Eastern Europe only received a small slice of.
The healthiest Western nations are the newest such as America and Australia but they too are marking time. The American birth rate is better than the European one but not by nearly as much as people think. The decline hasn't hit us as badly as Europe but all that means is give it more time and it will.
The spigot of immigration at the Mexican border is being turned up all the way by a Republican administration, not only in a quest for votes but because America has adopted much of the European socialist infrastructure that requires a constant incoming immigrant population to serve as the newest recruits in the MLM scheme of programs like social security. Corporations caring for nothing but profits outsource all the jobs they can and import Mexican immigrants to do the cheap and dirty labor they can't outsource.
America's industry is a passing dream and if the streets of American cities aren't populated by large hostile Muslim populations, that's only because Europeans have Arab speaking populations next door while we have spanish speaking ones. If Latino gangs proliferate in small towns and millions of illegals march around waving Mexican flags while demanding citizenship, like the Muslims in Europe they're simply playing the part of the Barbarians at the Gate while we do the work of burning Rome.
From America's birth, the country came with a vision of manifest destiny. When that vision was achieved and America dominated the world, a sheepish and small-minded leadership took a look around and began following Europe's path of national suicide. Devoid of a national destiny or a national goal, a nation becomes nothing more than a provider of services, a government the administrator of those services and its population perennially on the dole waiting for a handout. Once upon a time America had a vision of a glorious future, today no one can articulate a glorious vision for America.
Liberals prescribe more government programs and less national sovereignty in favor of international cooperation. Conservatives offer up doses of bible thumping and religion in public life. Neither address the simple fact that they have no national vision to offer. Neither the right nor the left is actually offering a vision of a future for America, all they're doing is wrangling over the terms of its dismantling.
Consumerism has instead stepped into the breach of vision promoting the pursuit of happiness living the shopping dream. Credit cards, ecommerce indebt people while a daily parade of gadgets, clothes, snacks and cars come packaged in audio, video, text and image promising that happiness is for sale. Without any overriding national goal or vision, all that remains is satisfying manufactured appetites for the output of the same companies that outsource the labor and push immigration in order to create those products at a profit in the first place.
While corporations tempt and dazzle the public with its products, the government leeches away ever income with new programs creating a bigger and bigger runaway bureaucracy. Governments no longer address problems so much as they bury them in paperwork, budgets and new departments. Even America's military capabilities become subservient to muddled political correctness. Is it any wonder that national pastimes like football and basketball have grown more and more thuggish parraleling Europe's impotent soccer riots.
What will America look like then in a century? It will like be a latin-american country in fact if not in name, little distinguishable from Brazil. As politics become more acrimonious and a large spanish speaking immigrant population pours in without a melting pot to melt into, North America will look like South America. And don't count the Muslims out either. Islamic and Arab influence in Latin America is rising. El Salvador has a Palestinian President. Argentina had a Lebanese one, when in collaboration with the authorities Iran carried out a large scale bombing there. A lot of the Spanish stars this side of the border like Selma Hayek or Shakira are actually the children of Lebanese immigrants.
What is the meaning of all beyond the obvious? Civilizations throughout history decline and eventually collapse. We're seeing that now all the more personally so, because it's happening before our eyes. Western civilization of the last six hundred years was an economic civilization living and dying by expanding trade, locating resources for production and exchanging them for manufactured goods. Everything from the colonization of America to WW1 was driven by it. Byproducts of that economic development gave us democratic societies, new countries and broad vistas.
Uncontrolled they also brought on destructive wars, destroyed countries gutting them from the inside eventually leaving nothing but nations of consumers buying products they no longer manufactured, of resources they no longer owned and even whose services and technical support had been outsourced.
Commerce is a river and in the hands of corporations whose CEO's care nothing except for cutting costs to edge out a profit margin this quarter before they're fired and move on to ruin another company, it's a river that flows to where it's cheapest. The very byproducts that created the wealthy and secure Western countries are the ones that insure the river flows away from them. The very technology they research creates greater opportunities for companies to outsource their employment. The Catch 22 is that it's the very things that have made the West successful that are killing it.
By the mid-20th century when the world was explored and conquered and superpowers gazed at each other across an atom bomb, greater ideals died. Nationalism, a thirst for exploration that had turned the world upside down for a century died out. In its place came a selfish existence in which people lived for new cars, mortgages and DVD players; while foolishly believing they were really living for themselves. Ideals were replaced by senseless radicalism. The first world grew fat and grey, never troubling their idyll in their consumeristic paradise to actually have children and plan for the future.
One can look at the coming extinction of Europe and call it the wrath of G-d, which it may well be. But inexplicable as it seems, it is really a civilization cutting its own throat through its small-minded selfishness.
The end, that much prophesied end, will indeed come with a whimper not a bang, unless we make a few bangs of our own. Great new beginnings are explosive ones. We still have the might to tackle great projects, a vast array of enemies gather around us and the stars above call to us.
We can embrace that future with a bang and refuse to go out into the darkness or we will indeed fall with the whimper of warehoused old men lying in cots while outside armed gangs loot and burn and the new caliphate flies its green and yellow flags above our cities.
Civilization is in our hands and the hour is nigh.
Thursday, June 24, 2010
Collapse Of The American Empire: Swift, Silent, Certain
From Market Watch:
March 9, 2010, 12:01 a.m. EST · Recommend (34) · Post:
Collapse of the American Empire: swift, silent, certain
Commentary: Historians warning of a sudden 'thief at night,' an 'accelerating car crash'View all Paul B. Farrell ›
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Comments Screener (705) Alert Email Print ShareBy Paul B. Farrell, MarketWatch
ARROYO GRANDE, Calif. (MarketWatch) -- "One of the disturbing facts of history is that so many civilizations collapse," warns anthropologist Jared Diamond in "Collapse: How Societies Choose to Fail or Succeed." Many "civilizations share a sharp curve of decline. Indeed, a society's demise may begin only a decade or two after it reaches its peak population, wealth and power."
Now, Harvard's Niall Ferguson, one of the world's leading financial historians, echoes Diamond's warning: "Imperial collapse may come much more suddenly than many historians imagine. A combination of fiscal deficits and military overstretch suggests that the United States may be the next empire on the precipice." Yes, America is on the edge.
Monopoly Dot-Com Edition: Like playing net stocksMarketWatch's Rex Crum and Shawn Langlois play the dot-com edition of Monopoly and, like the day-traders of the dot-com boom, end up bankrupt.
Dismiss his warning at your peril. Everything you learned, everything you believe and everything driving our political leaders is based on a misleading, outdated theory of history. The American Empire is at the edge of a dangerous precipice, at risk of a sudden, rapid collapse.
Ferguson is brilliant, prolific and contrarian. His works include the recent "Ascent of Money: A Financial History of the World;" "The Cash Nexus: Money and Power in the Modern World;" "Colossus: The Rise and Fall of The American Empire;" and "The War of the World," a survey of the "savagery of the 20th century" where he highlights a profound "paradox that, though the 20th century was 'so bloody,' it was also 'a time of unparalleled progress.'"
Why? Throughout history imperial leaders inevitably emerge and drive their nations into wars for greater glory and "economic progress," while inevitably leading their nation into collapse. And that happens suddenly and swiftly, within "a decade or two."
You'll find Ferguson's latest work, "Collapse and Complexity: Empires on the Edge of Chaos," in Foreign Affairs, the journal of the Council of Foreign Relations, a nonpartisan think tank. His message negates all the happy talk you're hearing in today's news -- about economic recovery and new bull markets, about "hope," about a return to "American greatness" -- from Washington politicians and Wall Street bankers.
'Collapse of All Empires:' 5 stages repeating through the ages
Ferguson opens with a fascinating metaphor: "There is no better illustration of the life cycle of a great power than 'The Course of Empire,' a series of five paintings by Thomas Cole that hangs in the New York Historical Society. Cole was a founder of the Hudson River School and one of the pioneers of nineteenth-century American landscape painting; in 'The Course of Empire,' he beautifully captured a theory of imperial rise and fall to which most people remain in thrall to this day. Each of the five imagined scenes depicts the mouth of a great river beneath a rocky outcrop."
If you're unable to see them at the historical society, they're all reproduced in Foreign Affairs, underscoring Ferguson's warnings that the "American Empire on the precipice," near collapse.
First. 'The Savage State,' before the Empire rises
"In the first, 'The Savage State,' a lush wilderness is populated by a handful of hunter-gatherers eking out a primitive existence at the break of a stormy dawn." Imagine our history from Columbus' discovery of America in 1492 on through four more centuries as we savagely expanded across the continent.
Second. 'The Arcadian or Pastoral State,' as the American Empire flourishes
"The second picture, 'The Arcadian or Pastoral State,' is of an agrarian idyll: the inhabitants have cleared the trees, planted fields, and built an elegant Greek temple." The temple may seem out of place. However, Cole's paintings were done in 1833-1836, not long after Thomas Jefferson built the University of Virginia using classical Greek and Roman revival architecture.
As Ferguson continues the tour you sense you're actually inside the New York Historical Society, visually reminded of how history's great cycles do indeed repeat over and over. You are also reminded of one of history's great tragic ironies -- that all nations fail to learn the lessons of history, that all nations and their leaders fall prey to their own narcissistic hubris and that all eventually collapse from within.
Third. Consummation of the American Empire
"The third and largest of the paintings is 'The Consummation of Empire.' Now, the landscape is covered by a magnificent marble entrepôt, and the contented farmer-philosophers of the previous tableau have been replaced by a throng of opulently clad merchants, proconsuls and citizen-consumers. It is midday in the life cycle."
'The Consummation of Empire' focuses us on Ferguson's core message: At the very peak of their power, affluence and glory, leaders arise, run amok with imperial visions and sabotage themselves, their people and their nation. They have it all.
But more-is-not enough as greed, arrogance and a thirst for power consume them. Back in the early days of the Iraq war, Kevin Phillips, political historian and former Nixon strategist, also captured this inevitable tendency in Wealth and Democracy:
"Most great nations, at the peak of their economic power, become arrogant and wage great world wars at great cost, wasting vast resources, taking on huge debt, and ultimately burning themselves out." We sense the "consummation" of the American Empire occurred with the leadership handoff from Bill Clinton to George W. Bush.
Unfortunately that peak is behind us: Clinton, Bush, Henry Paulson, Ben Bernanke, Sarah Palin, Barack Obama, Mitt Romney and all future American leaders are merely playing their parts in the greatest of all historical dramas, repeating but never fully grasping the lessons of history in their insatiable drive for "economic progress," to recapture former glory ... while unwittingly pushing our empire to the edge, into collapse.
Four. Destruction of the Empire
Then comes 'The Destruction of Empire,' the fourth stage in Ferguson's grand drama about the life-cycle of all empires. In "Destruction" "the city is ablaze, its citizens fleeing an invading horde that rapes and pillages beneath a brooding evening sky." Elsewhere in "The War of the World," Ferguson described the 20th century as "the bloodiest in history, one hundred years of butchery." Today's high-tech relentless news cycle, suggests that our 21st century world is a far bloodier return to savagery.
At this point, investors are asking themselves: How can I prepare for the destruction and collapse of the American Empire? There is no solution in the Cole-Ferguson scenario, only an acceptance of fate, of destiny, of history's inevitable cycles.
But there is one in "Wealth, War and Wisdom" by hedge fund manager Barton Biggs, Morgan Stanley's former chief global strategist who warns us of the "possibility of a breakdown of the civilized infrastructure," advising us to buy a farm in the mountains.
"Your safe haven must be self-sufficient and capable of growing some kind of food ... well-stocked with seed, fertilizer, canned food, wine, medicine, clothes, etc. Think Swiss Family Robinson." And when they come looting, fire "a few rounds over the approaching brigands' heads."
Five. Desolation ... after the Empire disappears
"Finally, the moon rises over the fifth painting, 'Desolation,'" says Ferguson. There is not a living soul to be seen, only a few decaying columns and colonnades overgrown by briars and ivy." No attacking "brigands?" No loveable waste-collecting robots from Wall-E?
The good news is the Earth will naturally regenerate itself without savage humans, as we saw in Alan Weisman's brilliant "The World Without Us:" Steel buildings decay. Microbes eat indestructible plastics. Eons pass. And Earth reemerges in all its glory, a Garden of Eden.
Epilogue: 'All Empires ... are condemned to decline and fall'
In a Los Angeles Times column, Ferguson asks: "America, a Fragile Empire: Here today, gone tomorrow, could the United States fall that fast?" And his answer is clear and emphatic: "For centuries, historians, political theorists, anthropologists and the public have tended to think about the political process in seasonal, cyclical terms ... we discern a rhythm to history. Great powers, like great men, are born, rise, reign and then gradually wane. No matter whether civilizations decline culturally, economically or ecologically, their downfalls are protracted."
We are deceiving ourselves, convinced "the challenges that face the United States are often represented as slow-burning ... threats seem very remote."
"But what if history is not cyclical and slow-moving but arrhythmic?" asks Ferguson. What if history is "at times almost stationary but also capable of accelerating suddenly, like a sports car? What if collapse does not arrive over a number of centuries but comes suddenly, like a thief in the night?" What if the collapse of the American Empire is dead ahead, in the next decade? What if, as with the 2000 dot-com crash, we're in denial, refusing to prepare?
Ferguson's final message about America's destiny comes from Foreign Affairs: "Conceived in the mid-1830s, Cole's great five-part painting has a clear message: all empires, no matter how magnificent, are condemned to decline and fall." Throughout history, empires function "in apparent equilibrium for some unknowable period. And then, quite abruptly ... collapse," a blunt reminder of the sudden, swift, silent, certain timetable in Diamond's "Collapse" where a "society's demise may begin only a decade or two after it reaches its peak population, wealth and power."
You are forewarned: If the peak of America's glory was the leadership handoff from Clinton to Bush, then we have already triggered the countdown to collapse, the decade from 2010 until 2020 ... tick ... tick ... tick ...
March 9, 2010, 12:01 a.m. EST · Recommend (34) · Post:
Collapse of the American Empire: swift, silent, certain
Commentary: Historians warning of a sudden 'thief at night,' an 'accelerating car crash'View all Paul B. Farrell ›
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Comments Screener (705) Alert Email Print ShareBy Paul B. Farrell, MarketWatch
ARROYO GRANDE, Calif. (MarketWatch) -- "One of the disturbing facts of history is that so many civilizations collapse," warns anthropologist Jared Diamond in "Collapse: How Societies Choose to Fail or Succeed." Many "civilizations share a sharp curve of decline. Indeed, a society's demise may begin only a decade or two after it reaches its peak population, wealth and power."
Now, Harvard's Niall Ferguson, one of the world's leading financial historians, echoes Diamond's warning: "Imperial collapse may come much more suddenly than many historians imagine. A combination of fiscal deficits and military overstretch suggests that the United States may be the next empire on the precipice." Yes, America is on the edge.
Monopoly Dot-Com Edition: Like playing net stocksMarketWatch's Rex Crum and Shawn Langlois play the dot-com edition of Monopoly and, like the day-traders of the dot-com boom, end up bankrupt.
Dismiss his warning at your peril. Everything you learned, everything you believe and everything driving our political leaders is based on a misleading, outdated theory of history. The American Empire is at the edge of a dangerous precipice, at risk of a sudden, rapid collapse.
Ferguson is brilliant, prolific and contrarian. His works include the recent "Ascent of Money: A Financial History of the World;" "The Cash Nexus: Money and Power in the Modern World;" "Colossus: The Rise and Fall of The American Empire;" and "The War of the World," a survey of the "savagery of the 20th century" where he highlights a profound "paradox that, though the 20th century was 'so bloody,' it was also 'a time of unparalleled progress.'"
Why? Throughout history imperial leaders inevitably emerge and drive their nations into wars for greater glory and "economic progress," while inevitably leading their nation into collapse. And that happens suddenly and swiftly, within "a decade or two."
You'll find Ferguson's latest work, "Collapse and Complexity: Empires on the Edge of Chaos," in Foreign Affairs, the journal of the Council of Foreign Relations, a nonpartisan think tank. His message negates all the happy talk you're hearing in today's news -- about economic recovery and new bull markets, about "hope," about a return to "American greatness" -- from Washington politicians and Wall Street bankers.
'Collapse of All Empires:' 5 stages repeating through the ages
Ferguson opens with a fascinating metaphor: "There is no better illustration of the life cycle of a great power than 'The Course of Empire,' a series of five paintings by Thomas Cole that hangs in the New York Historical Society. Cole was a founder of the Hudson River School and one of the pioneers of nineteenth-century American landscape painting; in 'The Course of Empire,' he beautifully captured a theory of imperial rise and fall to which most people remain in thrall to this day. Each of the five imagined scenes depicts the mouth of a great river beneath a rocky outcrop."
If you're unable to see them at the historical society, they're all reproduced in Foreign Affairs, underscoring Ferguson's warnings that the "American Empire on the precipice," near collapse.
First. 'The Savage State,' before the Empire rises
"In the first, 'The Savage State,' a lush wilderness is populated by a handful of hunter-gatherers eking out a primitive existence at the break of a stormy dawn." Imagine our history from Columbus' discovery of America in 1492 on through four more centuries as we savagely expanded across the continent.
Second. 'The Arcadian or Pastoral State,' as the American Empire flourishes
"The second picture, 'The Arcadian or Pastoral State,' is of an agrarian idyll: the inhabitants have cleared the trees, planted fields, and built an elegant Greek temple." The temple may seem out of place. However, Cole's paintings were done in 1833-1836, not long after Thomas Jefferson built the University of Virginia using classical Greek and Roman revival architecture.
As Ferguson continues the tour you sense you're actually inside the New York Historical Society, visually reminded of how history's great cycles do indeed repeat over and over. You are also reminded of one of history's great tragic ironies -- that all nations fail to learn the lessons of history, that all nations and their leaders fall prey to their own narcissistic hubris and that all eventually collapse from within.
Third. Consummation of the American Empire
"The third and largest of the paintings is 'The Consummation of Empire.' Now, the landscape is covered by a magnificent marble entrepôt, and the contented farmer-philosophers of the previous tableau have been replaced by a throng of opulently clad merchants, proconsuls and citizen-consumers. It is midday in the life cycle."
'The Consummation of Empire' focuses us on Ferguson's core message: At the very peak of their power, affluence and glory, leaders arise, run amok with imperial visions and sabotage themselves, their people and their nation. They have it all.
But more-is-not enough as greed, arrogance and a thirst for power consume them. Back in the early days of the Iraq war, Kevin Phillips, political historian and former Nixon strategist, also captured this inevitable tendency in Wealth and Democracy:
"Most great nations, at the peak of their economic power, become arrogant and wage great world wars at great cost, wasting vast resources, taking on huge debt, and ultimately burning themselves out." We sense the "consummation" of the American Empire occurred with the leadership handoff from Bill Clinton to George W. Bush.
Unfortunately that peak is behind us: Clinton, Bush, Henry Paulson, Ben Bernanke, Sarah Palin, Barack Obama, Mitt Romney and all future American leaders are merely playing their parts in the greatest of all historical dramas, repeating but never fully grasping the lessons of history in their insatiable drive for "economic progress," to recapture former glory ... while unwittingly pushing our empire to the edge, into collapse.
Four. Destruction of the Empire
Then comes 'The Destruction of Empire,' the fourth stage in Ferguson's grand drama about the life-cycle of all empires. In "Destruction" "the city is ablaze, its citizens fleeing an invading horde that rapes and pillages beneath a brooding evening sky." Elsewhere in "The War of the World," Ferguson described the 20th century as "the bloodiest in history, one hundred years of butchery." Today's high-tech relentless news cycle, suggests that our 21st century world is a far bloodier return to savagery.
At this point, investors are asking themselves: How can I prepare for the destruction and collapse of the American Empire? There is no solution in the Cole-Ferguson scenario, only an acceptance of fate, of destiny, of history's inevitable cycles.
But there is one in "Wealth, War and Wisdom" by hedge fund manager Barton Biggs, Morgan Stanley's former chief global strategist who warns us of the "possibility of a breakdown of the civilized infrastructure," advising us to buy a farm in the mountains.
"Your safe haven must be self-sufficient and capable of growing some kind of food ... well-stocked with seed, fertilizer, canned food, wine, medicine, clothes, etc. Think Swiss Family Robinson." And when they come looting, fire "a few rounds over the approaching brigands' heads."
Five. Desolation ... after the Empire disappears
"Finally, the moon rises over the fifth painting, 'Desolation,'" says Ferguson. There is not a living soul to be seen, only a few decaying columns and colonnades overgrown by briars and ivy." No attacking "brigands?" No loveable waste-collecting robots from Wall-E?
The good news is the Earth will naturally regenerate itself without savage humans, as we saw in Alan Weisman's brilliant "The World Without Us:" Steel buildings decay. Microbes eat indestructible plastics. Eons pass. And Earth reemerges in all its glory, a Garden of Eden.
Epilogue: 'All Empires ... are condemned to decline and fall'
In a Los Angeles Times column, Ferguson asks: "America, a Fragile Empire: Here today, gone tomorrow, could the United States fall that fast?" And his answer is clear and emphatic: "For centuries, historians, political theorists, anthropologists and the public have tended to think about the political process in seasonal, cyclical terms ... we discern a rhythm to history. Great powers, like great men, are born, rise, reign and then gradually wane. No matter whether civilizations decline culturally, economically or ecologically, their downfalls are protracted."
We are deceiving ourselves, convinced "the challenges that face the United States are often represented as slow-burning ... threats seem very remote."
"But what if history is not cyclical and slow-moving but arrhythmic?" asks Ferguson. What if history is "at times almost stationary but also capable of accelerating suddenly, like a sports car? What if collapse does not arrive over a number of centuries but comes suddenly, like a thief in the night?" What if the collapse of the American Empire is dead ahead, in the next decade? What if, as with the 2000 dot-com crash, we're in denial, refusing to prepare?
Ferguson's final message about America's destiny comes from Foreign Affairs: "Conceived in the mid-1830s, Cole's great five-part painting has a clear message: all empires, no matter how magnificent, are condemned to decline and fall." Throughout history, empires function "in apparent equilibrium for some unknowable period. And then, quite abruptly ... collapse," a blunt reminder of the sudden, swift, silent, certain timetable in Diamond's "Collapse" where a "society's demise may begin only a decade or two after it reaches its peak population, wealth and power."
You are forewarned: If the peak of America's glory was the leadership handoff from Clinton to Bush, then we have already triggered the countdown to collapse, the decade from 2010 until 2020 ... tick ... tick ... tick ...
The Fight Between Free Enterprise And The American Federal Government
From The American Enterprise Institute:
A Conversation with Arthur C. Brooks By Arthur C. Brooks, Kathryn Jean Lopez
National Review Online
Thursday, June 24, 2010
President
Arthur C. Brooks
AEI's Arthur C. Brooks always manages to see the world from a fresh prospective, one that is buoyed by first principles. A manifestation of this is his latest book, The Battle: How the Fight between Free Enterprise and Big Government Will Shape America's Future. Brooks, the president of the American Enterprise Institute, talks about The Battle--and the future--with National Review Online's Kathryn Jean Lopez in this two-part interview.
KATHRYN JEAN LOPEZ: Culture war? Didn't we evolve beyond such talk somewhere around a Pat Buchanan speech at a Republican convention?
ARTHUR C. BROOKS: For many, that 1992 convention speech defined the term "culture war." But what I'm talking about is a new culture struggle--one fought not over guns, gays, and abortion but over the core characteristic of America: free enterprise. In my book I don't just demonstrate that free enterprise is the most efficient way of organizing an economy (which it is). I also show that it's an expression of American values, and, thus, that a fight for free enterprise is very much a fight for our culture.
LOPEZ: Has President Obama made Americans less happy? Is it even fair or reasonable or constructive to ask such a question?
BROOKS: Happiness is important to discuss. The opponents of free enterprise always claim they will make America a happier nation, and we always lamely respond with arguments about economic efficiency. Yet in truth, the better prescription for happiness is on our side, not theirs.
Nonpartisan social-survey data clearly show that the big driver of happiness is earned success: a person's belief that he has created value in his life or the life of others.Redistributionists always make the argument that relative income is a huge driver of unhappiness--that poorer people are unhappier than richer people simply because they have less money through no fault of their own--and thus we can get a happier, fairer society by equalizing incomes. This is based on a colossal misreading of data and a whole lot of ideology. The truth is that relative income is not directly related to happiness. Nonpartisan social-survey data clearly show that the big driver of happiness is earned success: a person's belief that he has created value in his life or the life of others. Of course, in a capitalist system, earned success is often rewarded financially, so people who have earned a lot of success tend to have more money than others. But it's the success, not the money, that does the trick. (We show this by comparing the happiness of people who have the same level of income but have different perceived success levels.)
The system that enables the most people to earn the most success is free enterprise, by matching up people's skills, interests, and abilities. In contrast, redistribution simply spreads money around. Even worse, it attenuates the ability to earn success by perverting economic incentives. Free enterprise is essentially a formula not just for wealth creation, but for life satisfaction.
LOPEZ: Are free enterprise and big government natural enemies?
BROOKS: There are some things that government does well. When the U.S. government was fighting Nazi Germany and Imperial Japan, it was the champion of freedom in the world. It took a big government to win World War II. But it takes a smart one to realize it is only the entrepreneurialism of individuals that can deliver thriving economies and human flourishing. Government has a role, of course, such as enforcing the rule of law. But when it takes resources out of the hands of innovators and risk-takers, when it regulates small businesses out of existence, when it favors crony corporations instead of entrepreneurs, when it taxes corporations so much they move abroad--then, yes, big government becomes the enemy of free enterprise.
LOPEZ: We're always told that free enterprise is merciless. Isn't it the source of misery for everyone but the guys at the very top? (And of course they are guys, because everyone knows women are oppressed in the American economy.)
BROOKS: Absolutely not. The data show that a poor man who earns his success and believes he has a chance to get ahead through his own efforts--that man is happier than a "guy at the very top" who does not feel he has earned his success (or that anyone really can). And it's as true for women as it is for men. Free enterprise does not bow to gender, class, race, or ethnicity. It rewards hard work, dedication, initiative, talent, and street smarts. It's truly a force for liberation, not oppression.
LOPEZ: Is big government always an enemy of conservatism? And of a lot of what makes America America?
BROOKS: Well, as I said earlier, not when the government is defending American interests and liberties. But when the government takes over large parts of the economy that could be better run by the private sector, when it brings the top down simply to level outcomes, and when it picks the winners and the losers and makes markets fail, it is a problem not just for conservatives but for Americans in general. Government's role is an important (but restricted) one: protecting the environment in which honest people can earn their success.
LOPEZ: You talk about the "soul" of America" being "at stake." Is there even a consensus about what exactly that soul is? Do we even all want her to have a soul? And can I call her "her"?
BROOKS: By "soul" I mean the essence of what it means to be American. And yes, there is a fairly broad consensus, a shared understanding of what makes us American. In the mainstream--among at least 70 percent of Americans, according to nonpartisan data sources--there is a strong belief in liberty, equality of opportunity, and entrepreneurship. In other words, the free-enterprise system is understood as being more than an economic alternative--it is understand as being the center of our culture.
LOPEZ: What is the "30 percent coalition"?
BROOKS: The last question hinted at the answer to this one. The "30 percent coalition" is a term I coined for the minority in this country who do not like or support our free-enterprise culture, and who seek to change it for the rest of us. The 30 percent are led by the usual suspects--opinion-leaders in academia, the media, the entertainment industry, and so on. All the data available tell us these are among the most radical players in the battle against our culture of free enterprise. But adding them all up doesn't get us to 30 percent. The ranks of the coalition are swelled by others, especially young people, who have not (yet) experienced the depressing realities of a redistributive economy. A January 2010 Gallup poll found that a majority of Americans between the ages of 18 and 34 actually hold a positive view of socialism. Which probably makes sense, since the only socialists they've seen are their professors at college.
LOPEZ: What's the "Obama Narrative," and what's so wrong with it?
BROOKS: The Obama Narrative is the administration's basic account of how we got into the financial crisis of 2008 and how President Obama said he would get us out of it. It blames Wall Street and weak regulation for getting us in--and promises big government and strong regulation to get us out. It's not accurate. Ill-advised government policy was responsible for a large part of this mess (particularly the federal mandates for Fannie Mae and Freddie Mac to ramp up their lending even to people who had sub-par credit). Bigger government will not clean it up. The enterprise, initiative, and ingenuity of the American people will--if we allow these forces to work.
LOPEZ: Are you a defender of economic inequality? Isn't it the cause of misery?
BROOKS: Unequal outcomes don't make us miserable. Americans like success stories--they feel they can succeed, too. Misery comes from thinking you have no chance to improve your lot in life, no chance to get ahead through hard work and drive. If you approve of people getting big rewards for big efforts, that's not defending economic inequality--that's defending fairness. A fair system is not one that levels outcomes--it is one that rewards hard work, merit, and excellence (while penalizing free riding and laziness). Fairness is a concept that we in the free-enterprise movement have to take back.
Incidentally, none of this is to suggest that we can't ever be in favor of minimum basic services for people, which might be necessary to allow citizens to exploit opportunity. Even Hayek noted that this is can be a legitimate competency for government. But protecting people from starvation is very different from what the welfare state increasingly focuses on today: redistribution for the sake of equality ("fairness and balance" in our tax code), social engineering (everybody deserves a mortgage, no matter how lousy his credit), and policies intended to take the downside risk out of our decisions (bailouts).
LOPEZ: You write that "People are surprisingly satisfied with their jobs in America." How can that be so? Everyone seems to tell us otherwise.
BROOKS: I know, it's surprising, but it's true. A great deal of data show that Americans are overwhelmingly satisfied with their jobs, and this doesn't depend on education or even income levels. And Americans in general are much more satisfied with their jobs than Europeans. According to the International Social Survey Programme, we are 52 percent likelier than the Germans, 42 percent likelier than the British, and about 190 percent likelier than the Spanish to say we have complete job satisfaction.
LOPEZ: Is it fair to say that conservative economic policy is as bleeding-heart as the Left portrays itself as being? That it actually could tackle poverty if truly implemented? Or is that way too simplistic and idealistic?
BROOKS: If by "conservative economic policy" you mean free enterprise, then yes. It's absolutely about the heart. Free enterprise promotes human flourishing and individual achievement, earned success and personal well-being. These are the arguments I make in the book--and the reason some have even characterized it as a self-help book. It doesn't tell you how to get rich or win a promotion or get elected to office or win friends and influence people. But it tells you how you can pursue happiness--and why free enterprise is the best system to make that happen. Entrepreneurs really are the New Age radicals, tapping into the transformative power that comes from striving, achieving your potential, and creating value in your own life and the lives of your loved ones. The fact that it also produces the most explosive economic outcomes, for individuals and societies alike, is secondary (although nice).
LOPEZ: How important is free trade in this new culture war?
Free enterprise promotes human flourishing and individual achievement, earned success and personal well-being.BROOKS: It is important. Free trade has been responsible for the greatest increases in prosperity for the poor all around the globe. Since 1950, the volume of merchandise traded worldwide has increased by a factor of 27. This has led to rising living standards for the people of China, India, Brazil, and many other places in the developing world--and for Americans too. And there's another benefit. Free trade among nations also fosters cross-cultural understanding and the growth of democracy and civil society worldwide. Unfortunately, we currently have an administration that is not clearly committed to free trade because, many argue, of its political debt to labor unions.
LOPEZ: You use the phrase "world stewardship." How do conservatives reclaim the language of talking about these things? We're so often buying into others' frameworks. You're not.
BROOKS: To me "world stewardship" means being cognizant of the fact that we are blessed in America with great abundance, having the wisdom to understand why, and then sharing the means to that abundance. I strongly believe that what will keep America strong is (1) a deep confidence that our success as a nation is earned, (2) a national willingness to share the means to prosperity--the free-enterprise system--with others around the world, and (3) an ironclad resistance to policies that will mortgage away our system from our children and grandchildren. This is world stewardship. In the book I talk a little about actual policy prescriptions that do these things, and I refer readers to works by scholars who really get it, like my colleagues Mauro De Lorenzo and Glenn Hubbard.
LOPEZ: So how do we stop America's current slide toward Europeanization? That's a big question, I realize.
BROOKS: One way is simply to point out the ethical differences between the Greek and the American street today. In the past month, Greek citizens have rioted and gone on strike against the government. Why? Despite the worst economic conditions in years, labor unions and state employees are demanding that others pay for their early retirements, lifetime benefits, and lavish state pensions. In America, by contrast, our tea partiers demonstrate not to get more from others, but rather against government expansion, bloated government debt, bailouts, and a government overhaul of the health-care industry. In other words, the tea partiers are protesting against exactly what the Greeks are demanding. It is a near-perfect example of American exceptionalism.
LOPEZ: Why do social conservatives need to care about the fate of free enterprise?
BROOKS: Our founders wanted Americans to be the freest people in the world, and Alexis de Tocqueville believed they had succeeded. Liberty is more than a theory, though--it is a value to be practiced. And the way we practice liberty in our workaday lives--the way we express our values as we support our families--is through free enterprise. It is fundamentally a cultural issue in itself, and bound up in what each of us sees as a moral, equilibrated life.
LOPEZ: How was Scott Brown "in touch with America's mainstream"? And why is that an important lesson for politicians who want to win this November?
BROOKS: Scott Brown did not win by being a Republican apparatchik. He won because he struck a chord that resonated with the mainstream in his state--and that chord was his faith in the ability of free enterprise to get us out of the current economic malaise. In his words, "What made America great? Free markets, free enterprise, manufacturing, job creation. That's how we're going to do it, not by enlarging government." The data show that 70 percent of Americans--and, clearly, a majority of folks in Massachusetts as well--believe these things.
LOPEZ: You wrote in the Washington Post recently that "Brown's victory--and Rand Paul's triumph in Kentucky's Republican Senate primary last week, for that matter--are but warning shots in the burgeoning culture war. The most intense battles are still ahead." What do you mean? What should we be preparing for?
BROOKS: The Brown and Paul victories are harbingers of more struggles between those who put their faith in government and those who prefer to trust the abilities of their fellow Americans. They will be repeated all across the country. That's what we should be preparing for--in effect, the playing out of the subtitle of my book, "How the fight between free enterprise and big government will shape America's future."
LOPEZ: Has Scott Brown been to AEI? Has Rand Paul? Do you want to get more candidates and officeholders over there?
BROOKS: The answers are: No, No, and Yes. AEI conferences, seminars, and keynote addresses feature candidates and officeholders from all across the political spectrum--from former vice president Cheney to Treasury Secretary Geithner in the past months. But a major premise of The Battle is that it is principle--not short-term political power--that ultimately must carry the day. AEI is less interested in candidates in pursuit of raw political influence than in those who can best articulate the principles of sound policy based on our shared values.
LOPEZ: What might Tocqueville say about democracy in America, circa 2010?
BROOKS: Where the ruling class seems to be battling the soul of America, while polls suggest that the majority of voters are opposed to the transformation afoot? It doesn't make a whole lot of sense, does it?
Tocqueville would be struck by the fact that a large section of our population--a minority, yes, but still a large proportion--have abandoned the notion of American exceptionalism. And they're trying to get the rest of us to do the same. The exceptionalism of America, the things that made this country different from all others, was a phenomenon Tocqueville understood deeply. It's what bound our communities together in this great experiment in republican government. And he would be dismayed, I imagine, to see how some are so willing to sell that inheritance for a mess of (government) pottage.
LOPEZ: What do you think November looks like, and will it truly make a difference?
BROOKS: In the free-enterprise movement, we are not interested in party political headcounts (or at least we shouldn't be). I'm a registered Independent myself. And for me, the election of more Republicans to Congress is not necessarily the solution. Not if it means Republican lip service to free enterprise. If that happens, then the mid-terms will truly not make a difference--they might even set progress back. Whatever their party, I'm hoping for new members who share the values of freedom, opportunity, and entrepreneurship that are the bedrock of America--the reasons for our past success and the keys to our future prosperity.
LOPEZ: What do you want to be hearing from a Republican presidential candidate?
BROOKS: I want the same thing from Republican candidates as I want from Democratic candidates. Namely, that they are in favor of free enterprise, not redistribution. That they stand for equality of opportunity, not equality of outcome. That government's job is to stimulate prosperity rather than simply to treat poverty. And that they believe America is an exceptional nation--a gift to the world.
LOPEZ: I asked about Republicans, but Republicans have been part of the problem, too. Is there any chance a Democrat might fight the battle for America's soul?
BROOKS: Every chance, I would hope. Both parties have created our current problems. And both can become part of the solution--by championing the beliefs and values of mainstream America. The 70 percent majority that favors free enterprise contains a lot of Democrats among our citizens, and it can include Democratic politicians, too.
LOPEZ: Is it possible to be too hard on Republicans and the role they've played in setting us up for the transformation Democrats today are advancing?
In the free-enterprise movement, we are not interested in party political headcounts (or at least we shouldn't be)BROOKS: To win this struggle, we've got to be forthright in our opposition to all who are undermining American free enterprise and advancing big government. Earmarks are earmarks, for example--and there were at least 55,000 passed during the last administration. Again, the freest nation in the world was founded on principle, not the pursuit of power. If Republicans abandon the former, the electorate will sooner or later make sure they lose the latter. That's probably the most important political lesson from 2006 and 2008.
LOPEZ: What do you mean when you write, "The Obama Narrative's fiction about the innocence of homeowners is almost as pernicious as its fiction about the innocence of government"?
BROOKS: By 2000, everybody knew something was up when they saw friends and neighbors with crazy mortgages. Early in the decade I sold my house to a guy who got a 100 percent loan, and I thought, "If house prices fall, I bet he'll walk away from his mortgage." And of course, when the bubble burst, people walked away in droves, which was at the root of the financial crisis.
So who's to blame? The government with its housing policies, for sure. Mortgage originators making dangerous loans, of course. Private firms that were overleveraged, absolutely. But Main Street is hugely to blame, too.
Too many homeowners bought when they should have rented, or bought more than they could afford. And when the market went belly-up, many were willing to stick someone else with a loan they had signed up for. Economists now estimate that at least a quarter of all defaults were "strategic"--owners could have made their payments but chose not to. Adding insult to injury, the data show that many of the defaulters had lied on their original loan applications--in the run-up to the crash, as many as 70 percent of those who defaulted during the first three months of their mortgages had made fraudulent representations. The crisis exposed a huge ethical problem among a lot of ordinary Americans.
LOPEZ: Would your book have been published if the financial crisis hadn't happened?
BROOKS: Yes. There wouldn't have been an Obama Narrative, but statism and redistribution would still have been on the rise, and AEI would be fighting for free enterprise.
LOPEZ: Everyone seems to talk about the progressives these days (thank you, Glenn Beck). How much are they to blame?
BROOKS: I don't use the word "progressives" in the book. Sometimes I do use it when I write, though, because labels matter less than ideas. Leftists can call themselves "progressives," or "liberals," or "Power Rangers," or whatever they want--it's fine with me. I just want to take on the merits of redistributionism and statism.
LOPEZ: What exactly is a think tank? (I feel as if probably one-half of one percent of Americans have the time to think about the fact that such things exist!) Is that how AEI can best be described? Who belongs there, and what sort of interactions do you have with the "real world"?
BROOKS: Think tanks have been called "universities without students," and AEI does have the ethos of an academic institution: a lot of intellectual freedom and high expectations for both rigor and integrity. For AEI, though, it's perhaps more accurate to say we're a "university with values." AEI's mission is to expand liberty, increase individual opportunity, and strengthen free enterprise. We're lucky to have 200 of the best minds in America among our scholars and staff at AEI, working together for this mission. Also, we're actively working to build our education programs, so maybe the difference between our think tank and a university will shrink even more in the coming years.
LOPEZ: In all honesty, where do you see America in ten years?
BROOKS: America in ten years? I know I'm in the minority, but I'm very optimistic. I think there's a high likelihood we will look back at the current time and say that it was the beginning of the free-enterprise movement, when citizens rebelled against the expanding state, the moral case for free enterprise became popular and salient, and we began to develop the policy ideas to match. And I think--I hope--we will say that AEI was at the center of this renewal.
LOPEZ: How has AEI changed since you've been at the helm? What do you see as its role in a movement of many think tanks?
BROOKS: Philosophically, there isn't an inch of difference between me and Chris DeMuth (AEI's 22-year past president). Chris built the institution on the basis of the core values of freedom, opportunity, and entrepreneurship, and that hasn't changed. He also saw to it that the institute's work was driven not by a centrally planned research agenda, but rather by the creativity of great scholars like Kevin Hassett, Fred Kagan, Peter Wallison, Tom Donnelly, Michael Novak, Michael Rubin, and Rick Hess. That hasn't changed either. The changes you can see at AEI today primarily involve our need to keep our media up to date to carry our message. That means keeping up continuous innovation and experimentation in communications, creating new education programs, and always making sure that our moral purpose is clear. It is for this last reason that I wrote The Battle. It is basically a 40,000-word mission statement for AEI and an introduction to the policy analysis our scholars give to America.
LOPEZ: You talk a lot about entrepreneurship in your book. Have new media been an important example of this? I've noticed AEI has made itself more online-present since your arrival. I assume by design?
BROOKS: We've made great big strides in new media over the past year and a half. AEI is in the business of ideas that matter. And wherever the debate is--from the pages of the Wall Street Journal and National Review to the broadcast media to Capitol Hill--AEI will be in the thick of it. Today, with so much of the debate unfolding in the blogosphere and other new media, AEI is participating fully there, too. In fact, our improved communications abilities are really what I think has changed most at AEI in the past couple of years. We've focused on this for the following reason: If research is worth doing, then it is worth talking about. And new media have allowed us to find new audiences and talk to them about what we are doing.
LOPEZ: One can't interview you without asking: How do you go from being a professional French-horn player--in Spain--to being a conservative intellectual and ringleader?
BROOKS: I get this question all the time (and I usually punt on it because it's pretty convoluted). My path was not traditional--except for the fact that America's tradition of free enterprise makes almost any career trajectory possible. But anyway, here it is in a nutshell.
I grew up in Seattle. My mother was an artist, and my father was a math professor. As a kid I had only one goal: to be a professional French-horn player. I dropped out of college at 19 (a decision that the college and I agreed would be of mutual benefit), joined a chamber-music group for a few years, performed a bit with the great jazz guitarist Charlie Byrd, and then took a position with the Barcelona Orchestra. I got married in Spain, and after a few years my wife, Ester, and I moved back to America. Within a month she informed me--after getting multiple job offers in spite of her imperfect English at the time--that the United States was clearly the greatest country in the world for people who wanted to work. Mind you, she is from a hard-red Catalan family, so this was pretty paradigm-shifting stuff.
At 28, while still in the music business, I went back to college in my spare time and studied economics and math. Around this point I stumbled across the work of a scholar who seemed to me the cleverest person ever, a man I had never heard of named Charles Murray, who worked at some "think tank" called the American Enterprise Institute. I dug into the work of other AEI scholars and was completely transfixed by their views about free enterprise. I ultimately left music at 31 to start a Ph.D.--to see if I could someday do work like those crazed geniuses preaching freedom at that mythical think tank. After finishing grad school I taught for a decade (including seven years at Syracuse, a wonderful university that treated me with great generosity despite my heterodox views and Milton Friedman T-shirts), learned a lot more math and statistics, wrote some books, and ultimately wormed my way into AEI as a visiting scholar and wrote about the economics of charity and happiness.
I was completely in love with AEI and loitered about constantly. I suspect they made me president because it was easier than getting a restraining order to keep me off the premises. I feel deeply blessed every day to have been given the opportunity to serve the organization responsible for the ideas that quite literally changed my life. It's actually pretty strange working with my intellectual heroes. I try not to appear too awestruck, though, because my colleagues would probably exploit my loyalty by having me pick up their dry cleaning and such.
LOPEZ: What does your previous career have in common with your current one?
BROOKS: Creativity and freedom can express themselves in any number of ways. Bringing ideas to life in service to my values is what thrilled me in music, as an academic, and especially in the leadership of AEI.
Arthur C. Brooks is the president of AEI. Kathryn Jean Lopez is editor-at-large of National Review Online.
A Conversation with Arthur C. Brooks By Arthur C. Brooks, Kathryn Jean Lopez
National Review Online
Thursday, June 24, 2010
President
Arthur C. Brooks
AEI's Arthur C. Brooks always manages to see the world from a fresh prospective, one that is buoyed by first principles. A manifestation of this is his latest book, The Battle: How the Fight between Free Enterprise and Big Government Will Shape America's Future. Brooks, the president of the American Enterprise Institute, talks about The Battle--and the future--with National Review Online's Kathryn Jean Lopez in this two-part interview.
KATHRYN JEAN LOPEZ: Culture war? Didn't we evolve beyond such talk somewhere around a Pat Buchanan speech at a Republican convention?
ARTHUR C. BROOKS: For many, that 1992 convention speech defined the term "culture war." But what I'm talking about is a new culture struggle--one fought not over guns, gays, and abortion but over the core characteristic of America: free enterprise. In my book I don't just demonstrate that free enterprise is the most efficient way of organizing an economy (which it is). I also show that it's an expression of American values, and, thus, that a fight for free enterprise is very much a fight for our culture.
LOPEZ: Has President Obama made Americans less happy? Is it even fair or reasonable or constructive to ask such a question?
BROOKS: Happiness is important to discuss. The opponents of free enterprise always claim they will make America a happier nation, and we always lamely respond with arguments about economic efficiency. Yet in truth, the better prescription for happiness is on our side, not theirs.
Nonpartisan social-survey data clearly show that the big driver of happiness is earned success: a person's belief that he has created value in his life or the life of others.Redistributionists always make the argument that relative income is a huge driver of unhappiness--that poorer people are unhappier than richer people simply because they have less money through no fault of their own--and thus we can get a happier, fairer society by equalizing incomes. This is based on a colossal misreading of data and a whole lot of ideology. The truth is that relative income is not directly related to happiness. Nonpartisan social-survey data clearly show that the big driver of happiness is earned success: a person's belief that he has created value in his life or the life of others. Of course, in a capitalist system, earned success is often rewarded financially, so people who have earned a lot of success tend to have more money than others. But it's the success, not the money, that does the trick. (We show this by comparing the happiness of people who have the same level of income but have different perceived success levels.)
The system that enables the most people to earn the most success is free enterprise, by matching up people's skills, interests, and abilities. In contrast, redistribution simply spreads money around. Even worse, it attenuates the ability to earn success by perverting economic incentives. Free enterprise is essentially a formula not just for wealth creation, but for life satisfaction.
LOPEZ: Are free enterprise and big government natural enemies?
BROOKS: There are some things that government does well. When the U.S. government was fighting Nazi Germany and Imperial Japan, it was the champion of freedom in the world. It took a big government to win World War II. But it takes a smart one to realize it is only the entrepreneurialism of individuals that can deliver thriving economies and human flourishing. Government has a role, of course, such as enforcing the rule of law. But when it takes resources out of the hands of innovators and risk-takers, when it regulates small businesses out of existence, when it favors crony corporations instead of entrepreneurs, when it taxes corporations so much they move abroad--then, yes, big government becomes the enemy of free enterprise.
LOPEZ: We're always told that free enterprise is merciless. Isn't it the source of misery for everyone but the guys at the very top? (And of course they are guys, because everyone knows women are oppressed in the American economy.)
BROOKS: Absolutely not. The data show that a poor man who earns his success and believes he has a chance to get ahead through his own efforts--that man is happier than a "guy at the very top" who does not feel he has earned his success (or that anyone really can). And it's as true for women as it is for men. Free enterprise does not bow to gender, class, race, or ethnicity. It rewards hard work, dedication, initiative, talent, and street smarts. It's truly a force for liberation, not oppression.
LOPEZ: Is big government always an enemy of conservatism? And of a lot of what makes America America?
BROOKS: Well, as I said earlier, not when the government is defending American interests and liberties. But when the government takes over large parts of the economy that could be better run by the private sector, when it brings the top down simply to level outcomes, and when it picks the winners and the losers and makes markets fail, it is a problem not just for conservatives but for Americans in general. Government's role is an important (but restricted) one: protecting the environment in which honest people can earn their success.
LOPEZ: You talk about the "soul" of America" being "at stake." Is there even a consensus about what exactly that soul is? Do we even all want her to have a soul? And can I call her "her"?
BROOKS: By "soul" I mean the essence of what it means to be American. And yes, there is a fairly broad consensus, a shared understanding of what makes us American. In the mainstream--among at least 70 percent of Americans, according to nonpartisan data sources--there is a strong belief in liberty, equality of opportunity, and entrepreneurship. In other words, the free-enterprise system is understood as being more than an economic alternative--it is understand as being the center of our culture.
LOPEZ: What is the "30 percent coalition"?
BROOKS: The last question hinted at the answer to this one. The "30 percent coalition" is a term I coined for the minority in this country who do not like or support our free-enterprise culture, and who seek to change it for the rest of us. The 30 percent are led by the usual suspects--opinion-leaders in academia, the media, the entertainment industry, and so on. All the data available tell us these are among the most radical players in the battle against our culture of free enterprise. But adding them all up doesn't get us to 30 percent. The ranks of the coalition are swelled by others, especially young people, who have not (yet) experienced the depressing realities of a redistributive economy. A January 2010 Gallup poll found that a majority of Americans between the ages of 18 and 34 actually hold a positive view of socialism. Which probably makes sense, since the only socialists they've seen are their professors at college.
LOPEZ: What's the "Obama Narrative," and what's so wrong with it?
BROOKS: The Obama Narrative is the administration's basic account of how we got into the financial crisis of 2008 and how President Obama said he would get us out of it. It blames Wall Street and weak regulation for getting us in--and promises big government and strong regulation to get us out. It's not accurate. Ill-advised government policy was responsible for a large part of this mess (particularly the federal mandates for Fannie Mae and Freddie Mac to ramp up their lending even to people who had sub-par credit). Bigger government will not clean it up. The enterprise, initiative, and ingenuity of the American people will--if we allow these forces to work.
LOPEZ: Are you a defender of economic inequality? Isn't it the cause of misery?
BROOKS: Unequal outcomes don't make us miserable. Americans like success stories--they feel they can succeed, too. Misery comes from thinking you have no chance to improve your lot in life, no chance to get ahead through hard work and drive. If you approve of people getting big rewards for big efforts, that's not defending economic inequality--that's defending fairness. A fair system is not one that levels outcomes--it is one that rewards hard work, merit, and excellence (while penalizing free riding and laziness). Fairness is a concept that we in the free-enterprise movement have to take back.
Incidentally, none of this is to suggest that we can't ever be in favor of minimum basic services for people, which might be necessary to allow citizens to exploit opportunity. Even Hayek noted that this is can be a legitimate competency for government. But protecting people from starvation is very different from what the welfare state increasingly focuses on today: redistribution for the sake of equality ("fairness and balance" in our tax code), social engineering (everybody deserves a mortgage, no matter how lousy his credit), and policies intended to take the downside risk out of our decisions (bailouts).
LOPEZ: You write that "People are surprisingly satisfied with their jobs in America." How can that be so? Everyone seems to tell us otherwise.
BROOKS: I know, it's surprising, but it's true. A great deal of data show that Americans are overwhelmingly satisfied with their jobs, and this doesn't depend on education or even income levels. And Americans in general are much more satisfied with their jobs than Europeans. According to the International Social Survey Programme, we are 52 percent likelier than the Germans, 42 percent likelier than the British, and about 190 percent likelier than the Spanish to say we have complete job satisfaction.
LOPEZ: Is it fair to say that conservative economic policy is as bleeding-heart as the Left portrays itself as being? That it actually could tackle poverty if truly implemented? Or is that way too simplistic and idealistic?
BROOKS: If by "conservative economic policy" you mean free enterprise, then yes. It's absolutely about the heart. Free enterprise promotes human flourishing and individual achievement, earned success and personal well-being. These are the arguments I make in the book--and the reason some have even characterized it as a self-help book. It doesn't tell you how to get rich or win a promotion or get elected to office or win friends and influence people. But it tells you how you can pursue happiness--and why free enterprise is the best system to make that happen. Entrepreneurs really are the New Age radicals, tapping into the transformative power that comes from striving, achieving your potential, and creating value in your own life and the lives of your loved ones. The fact that it also produces the most explosive economic outcomes, for individuals and societies alike, is secondary (although nice).
LOPEZ: How important is free trade in this new culture war?
Free enterprise promotes human flourishing and individual achievement, earned success and personal well-being.BROOKS: It is important. Free trade has been responsible for the greatest increases in prosperity for the poor all around the globe. Since 1950, the volume of merchandise traded worldwide has increased by a factor of 27. This has led to rising living standards for the people of China, India, Brazil, and many other places in the developing world--and for Americans too. And there's another benefit. Free trade among nations also fosters cross-cultural understanding and the growth of democracy and civil society worldwide. Unfortunately, we currently have an administration that is not clearly committed to free trade because, many argue, of its political debt to labor unions.
LOPEZ: You use the phrase "world stewardship." How do conservatives reclaim the language of talking about these things? We're so often buying into others' frameworks. You're not.
BROOKS: To me "world stewardship" means being cognizant of the fact that we are blessed in America with great abundance, having the wisdom to understand why, and then sharing the means to that abundance. I strongly believe that what will keep America strong is (1) a deep confidence that our success as a nation is earned, (2) a national willingness to share the means to prosperity--the free-enterprise system--with others around the world, and (3) an ironclad resistance to policies that will mortgage away our system from our children and grandchildren. This is world stewardship. In the book I talk a little about actual policy prescriptions that do these things, and I refer readers to works by scholars who really get it, like my colleagues Mauro De Lorenzo and Glenn Hubbard.
LOPEZ: So how do we stop America's current slide toward Europeanization? That's a big question, I realize.
BROOKS: One way is simply to point out the ethical differences between the Greek and the American street today. In the past month, Greek citizens have rioted and gone on strike against the government. Why? Despite the worst economic conditions in years, labor unions and state employees are demanding that others pay for their early retirements, lifetime benefits, and lavish state pensions. In America, by contrast, our tea partiers demonstrate not to get more from others, but rather against government expansion, bloated government debt, bailouts, and a government overhaul of the health-care industry. In other words, the tea partiers are protesting against exactly what the Greeks are demanding. It is a near-perfect example of American exceptionalism.
LOPEZ: Why do social conservatives need to care about the fate of free enterprise?
BROOKS: Our founders wanted Americans to be the freest people in the world, and Alexis de Tocqueville believed they had succeeded. Liberty is more than a theory, though--it is a value to be practiced. And the way we practice liberty in our workaday lives--the way we express our values as we support our families--is through free enterprise. It is fundamentally a cultural issue in itself, and bound up in what each of us sees as a moral, equilibrated life.
LOPEZ: How was Scott Brown "in touch with America's mainstream"? And why is that an important lesson for politicians who want to win this November?
BROOKS: Scott Brown did not win by being a Republican apparatchik. He won because he struck a chord that resonated with the mainstream in his state--and that chord was his faith in the ability of free enterprise to get us out of the current economic malaise. In his words, "What made America great? Free markets, free enterprise, manufacturing, job creation. That's how we're going to do it, not by enlarging government." The data show that 70 percent of Americans--and, clearly, a majority of folks in Massachusetts as well--believe these things.
LOPEZ: You wrote in the Washington Post recently that "Brown's victory--and Rand Paul's triumph in Kentucky's Republican Senate primary last week, for that matter--are but warning shots in the burgeoning culture war. The most intense battles are still ahead." What do you mean? What should we be preparing for?
BROOKS: The Brown and Paul victories are harbingers of more struggles between those who put their faith in government and those who prefer to trust the abilities of their fellow Americans. They will be repeated all across the country. That's what we should be preparing for--in effect, the playing out of the subtitle of my book, "How the fight between free enterprise and big government will shape America's future."
LOPEZ: Has Scott Brown been to AEI? Has Rand Paul? Do you want to get more candidates and officeholders over there?
BROOKS: The answers are: No, No, and Yes. AEI conferences, seminars, and keynote addresses feature candidates and officeholders from all across the political spectrum--from former vice president Cheney to Treasury Secretary Geithner in the past months. But a major premise of The Battle is that it is principle--not short-term political power--that ultimately must carry the day. AEI is less interested in candidates in pursuit of raw political influence than in those who can best articulate the principles of sound policy based on our shared values.
LOPEZ: What might Tocqueville say about democracy in America, circa 2010?
BROOKS: Where the ruling class seems to be battling the soul of America, while polls suggest that the majority of voters are opposed to the transformation afoot? It doesn't make a whole lot of sense, does it?
Tocqueville would be struck by the fact that a large section of our population--a minority, yes, but still a large proportion--have abandoned the notion of American exceptionalism. And they're trying to get the rest of us to do the same. The exceptionalism of America, the things that made this country different from all others, was a phenomenon Tocqueville understood deeply. It's what bound our communities together in this great experiment in republican government. And he would be dismayed, I imagine, to see how some are so willing to sell that inheritance for a mess of (government) pottage.
LOPEZ: What do you think November looks like, and will it truly make a difference?
BROOKS: In the free-enterprise movement, we are not interested in party political headcounts (or at least we shouldn't be). I'm a registered Independent myself. And for me, the election of more Republicans to Congress is not necessarily the solution. Not if it means Republican lip service to free enterprise. If that happens, then the mid-terms will truly not make a difference--they might even set progress back. Whatever their party, I'm hoping for new members who share the values of freedom, opportunity, and entrepreneurship that are the bedrock of America--the reasons for our past success and the keys to our future prosperity.
LOPEZ: What do you want to be hearing from a Republican presidential candidate?
BROOKS: I want the same thing from Republican candidates as I want from Democratic candidates. Namely, that they are in favor of free enterprise, not redistribution. That they stand for equality of opportunity, not equality of outcome. That government's job is to stimulate prosperity rather than simply to treat poverty. And that they believe America is an exceptional nation--a gift to the world.
LOPEZ: I asked about Republicans, but Republicans have been part of the problem, too. Is there any chance a Democrat might fight the battle for America's soul?
BROOKS: Every chance, I would hope. Both parties have created our current problems. And both can become part of the solution--by championing the beliefs and values of mainstream America. The 70 percent majority that favors free enterprise contains a lot of Democrats among our citizens, and it can include Democratic politicians, too.
LOPEZ: Is it possible to be too hard on Republicans and the role they've played in setting us up for the transformation Democrats today are advancing?
In the free-enterprise movement, we are not interested in party political headcounts (or at least we shouldn't be)BROOKS: To win this struggle, we've got to be forthright in our opposition to all who are undermining American free enterprise and advancing big government. Earmarks are earmarks, for example--and there were at least 55,000 passed during the last administration. Again, the freest nation in the world was founded on principle, not the pursuit of power. If Republicans abandon the former, the electorate will sooner or later make sure they lose the latter. That's probably the most important political lesson from 2006 and 2008.
LOPEZ: What do you mean when you write, "The Obama Narrative's fiction about the innocence of homeowners is almost as pernicious as its fiction about the innocence of government"?
BROOKS: By 2000, everybody knew something was up when they saw friends and neighbors with crazy mortgages. Early in the decade I sold my house to a guy who got a 100 percent loan, and I thought, "If house prices fall, I bet he'll walk away from his mortgage." And of course, when the bubble burst, people walked away in droves, which was at the root of the financial crisis.
So who's to blame? The government with its housing policies, for sure. Mortgage originators making dangerous loans, of course. Private firms that were overleveraged, absolutely. But Main Street is hugely to blame, too.
Too many homeowners bought when they should have rented, or bought more than they could afford. And when the market went belly-up, many were willing to stick someone else with a loan they had signed up for. Economists now estimate that at least a quarter of all defaults were "strategic"--owners could have made their payments but chose not to. Adding insult to injury, the data show that many of the defaulters had lied on their original loan applications--in the run-up to the crash, as many as 70 percent of those who defaulted during the first three months of their mortgages had made fraudulent representations. The crisis exposed a huge ethical problem among a lot of ordinary Americans.
LOPEZ: Would your book have been published if the financial crisis hadn't happened?
BROOKS: Yes. There wouldn't have been an Obama Narrative, but statism and redistribution would still have been on the rise, and AEI would be fighting for free enterprise.
LOPEZ: Everyone seems to talk about the progressives these days (thank you, Glenn Beck). How much are they to blame?
BROOKS: I don't use the word "progressives" in the book. Sometimes I do use it when I write, though, because labels matter less than ideas. Leftists can call themselves "progressives," or "liberals," or "Power Rangers," or whatever they want--it's fine with me. I just want to take on the merits of redistributionism and statism.
LOPEZ: What exactly is a think tank? (I feel as if probably one-half of one percent of Americans have the time to think about the fact that such things exist!) Is that how AEI can best be described? Who belongs there, and what sort of interactions do you have with the "real world"?
BROOKS: Think tanks have been called "universities without students," and AEI does have the ethos of an academic institution: a lot of intellectual freedom and high expectations for both rigor and integrity. For AEI, though, it's perhaps more accurate to say we're a "university with values." AEI's mission is to expand liberty, increase individual opportunity, and strengthen free enterprise. We're lucky to have 200 of the best minds in America among our scholars and staff at AEI, working together for this mission. Also, we're actively working to build our education programs, so maybe the difference between our think tank and a university will shrink even more in the coming years.
LOPEZ: In all honesty, where do you see America in ten years?
BROOKS: America in ten years? I know I'm in the minority, but I'm very optimistic. I think there's a high likelihood we will look back at the current time and say that it was the beginning of the free-enterprise movement, when citizens rebelled against the expanding state, the moral case for free enterprise became popular and salient, and we began to develop the policy ideas to match. And I think--I hope--we will say that AEI was at the center of this renewal.
LOPEZ: How has AEI changed since you've been at the helm? What do you see as its role in a movement of many think tanks?
BROOKS: Philosophically, there isn't an inch of difference between me and Chris DeMuth (AEI's 22-year past president). Chris built the institution on the basis of the core values of freedom, opportunity, and entrepreneurship, and that hasn't changed. He also saw to it that the institute's work was driven not by a centrally planned research agenda, but rather by the creativity of great scholars like Kevin Hassett, Fred Kagan, Peter Wallison, Tom Donnelly, Michael Novak, Michael Rubin, and Rick Hess. That hasn't changed either. The changes you can see at AEI today primarily involve our need to keep our media up to date to carry our message. That means keeping up continuous innovation and experimentation in communications, creating new education programs, and always making sure that our moral purpose is clear. It is for this last reason that I wrote The Battle. It is basically a 40,000-word mission statement for AEI and an introduction to the policy analysis our scholars give to America.
LOPEZ: You talk a lot about entrepreneurship in your book. Have new media been an important example of this? I've noticed AEI has made itself more online-present since your arrival. I assume by design?
BROOKS: We've made great big strides in new media over the past year and a half. AEI is in the business of ideas that matter. And wherever the debate is--from the pages of the Wall Street Journal and National Review to the broadcast media to Capitol Hill--AEI will be in the thick of it. Today, with so much of the debate unfolding in the blogosphere and other new media, AEI is participating fully there, too. In fact, our improved communications abilities are really what I think has changed most at AEI in the past couple of years. We've focused on this for the following reason: If research is worth doing, then it is worth talking about. And new media have allowed us to find new audiences and talk to them about what we are doing.
LOPEZ: One can't interview you without asking: How do you go from being a professional French-horn player--in Spain--to being a conservative intellectual and ringleader?
BROOKS: I get this question all the time (and I usually punt on it because it's pretty convoluted). My path was not traditional--except for the fact that America's tradition of free enterprise makes almost any career trajectory possible. But anyway, here it is in a nutshell.
I grew up in Seattle. My mother was an artist, and my father was a math professor. As a kid I had only one goal: to be a professional French-horn player. I dropped out of college at 19 (a decision that the college and I agreed would be of mutual benefit), joined a chamber-music group for a few years, performed a bit with the great jazz guitarist Charlie Byrd, and then took a position with the Barcelona Orchestra. I got married in Spain, and after a few years my wife, Ester, and I moved back to America. Within a month she informed me--after getting multiple job offers in spite of her imperfect English at the time--that the United States was clearly the greatest country in the world for people who wanted to work. Mind you, she is from a hard-red Catalan family, so this was pretty paradigm-shifting stuff.
At 28, while still in the music business, I went back to college in my spare time and studied economics and math. Around this point I stumbled across the work of a scholar who seemed to me the cleverest person ever, a man I had never heard of named Charles Murray, who worked at some "think tank" called the American Enterprise Institute. I dug into the work of other AEI scholars and was completely transfixed by their views about free enterprise. I ultimately left music at 31 to start a Ph.D.--to see if I could someday do work like those crazed geniuses preaching freedom at that mythical think tank. After finishing grad school I taught for a decade (including seven years at Syracuse, a wonderful university that treated me with great generosity despite my heterodox views and Milton Friedman T-shirts), learned a lot more math and statistics, wrote some books, and ultimately wormed my way into AEI as a visiting scholar and wrote about the economics of charity and happiness.
I was completely in love with AEI and loitered about constantly. I suspect they made me president because it was easier than getting a restraining order to keep me off the premises. I feel deeply blessed every day to have been given the opportunity to serve the organization responsible for the ideas that quite literally changed my life. It's actually pretty strange working with my intellectual heroes. I try not to appear too awestruck, though, because my colleagues would probably exploit my loyalty by having me pick up their dry cleaning and such.
LOPEZ: What does your previous career have in common with your current one?
BROOKS: Creativity and freedom can express themselves in any number of ways. Bringing ideas to life in service to my values is what thrilled me in music, as an academic, and especially in the leadership of AEI.
Arthur C. Brooks is the president of AEI. Kathryn Jean Lopez is editor-at-large of National Review Online.
The End Of The British Empire
From The American Enterprise Institute:
The Locust Years Book Review By Mark Falcoff
The Weekly Standard
Thursday, June 24, 2010
A few months ago Peter Hitchens reminded his readers in the Daily Mail that a mere 70 years ago--in 1939 to be precise--"we were the world's greatest empire. Half the globe used our currency, we controlled vast resources, and owned enormous foreign investments. . . . We possessed an enormous Navy, a modern Air Force, and, at the same time, the most advanced welfare state in the world."
Anyone casually picking up this account of Britain in the interwar period might well conclude that Hitchens was referring to another country altogether. Of course, the key to the paradox is that while all the things in the Daily Mail piece are true, there can be a crucial difference between what a country actually is and how it feels about itself. Given particular circumstances, the possession of great power and loss of nerve can go together. This is what makes The Twilight Years of more than mere historical interest for the present-day American reader.
While Britain emerged technically victorious from the First World War, that conflict inflicted grievous wounds upon its society. Nearly a million young men were sacrificed in the killing machines of the Somme and the Marne, many from the very families from which the country's leadership class had been drawn for generations. After 1919, the country was led by old (or at least older) men, most of whom lacked the energy and imagination to steer Britain successfully into the complicated shoals of the postwar period. Resources that might have been devoted to modernization of industry or new technologies had already been diverted into financing the war effort, and latent industrial strife postponed for the duration was suddenly given free rein. New antidemocratic ideologies from Eastern and Central Europe were beginning to poison the atmosphere in elite cultural and intellectual circles.
The Twilight Years is hardly a cheering volume. In some ways it amounts to a long slog through two decades of clinical depression--if a society as a whole can be likened to an individual. The major themes are the (prematurely announced) death of capitalism, a concern with eugenics, and the sudden discovery of psychoanalysis and the unconscious, the love affair with the distant (and mythical) Soviet Union, and finally, a "peace movement" which eventually foundered upon the realities of Hitler's advances on the continent.
The anticapitalist motif is perhaps the principal thread that holds much of the politics together. Overy asserts that, particularly after 1929, there was "an unspoken assumption" in Britain--even among people who were not necessarily
Marxists--that "capitalism meant chaos, while planning equaled progress." Moreover, the widely publicized assumption that capitalism always led to war opened a two-way conduit between Communists and fellow travelers on one hand, and pacifists on the other.
Fear of war was, of course, a natural and understandable concern--if not, indeed, obsession--for Great Britain in this period, and not only because of the huge losses suffered during the most recent conflict. Changes in technology (particularly the development of airpower and the sudden possibility of long-range bombing) suddenly stripped the island of a sense of physical security long granted by geography. A fact perhaps forgotten today, Overy writes, is that the antiwar movement in Britain was the largest popular cause during the interwar period, "crossing all conventional lines of party allegiance, social class, gender difference, and regional identity."
While the Communist party of Great Britain never attracted many followers, the Soviet Union itself was the subject of huge admiration by broad sections of British intellectual and public life.Nonetheless, one cannot help being struck by the naïveté and unwisdom with which the peace movement attacked the problem. There was, for example, the Peace Pledge Union, which gathered millions of signatures, or the Peace Ballot, in which Britons were invited to vote against war--as if anybody was really "for" it. Great hopes were pinned on the League of Nations--until it failed to act after the Japanese invasion of Manchuria in 1931. Sillier still was the notion that "collective security"--in other words, a paper alliance system linking Britain, France, the Soviet Union, and perhaps Czechoslovakia--combined with disarmament!--could somehow discourage voracious dictators like Hitler and Mussolini.
The peace movement collapsed slowly in the face of harsh realities. One was the Spanish Civil War, which caused many leftists to suddenly reexamine their pacifist convictions; another was the Munich agreement; yet another was the Hitler-Stalin Pact followed by the carving up of Poland which deprived advocates of "collective security" of their Soviet linchpin.
One of the central paradoxes of this period is the fact that, while the Communist party of Great Britain never attracted many followers, the Soviet Union itself was the subject of huge admiration by broad sections of British intellectual and public life. The Society for Cultural Relations Between the Peoples of the British Commonwealth and the USSR was founded in 1924; by the 1930s it could count among its luminaries Virginia Woolf, Bertrand Russell, Aldous Huxley, H. G. Wells, and John Maynard Keynes. Another organization, the Committee for Peace and Friendship with the USSR, included Ralph Vaughan Williams, Bernard Shaw, G. D. H. Cole, and John Strachey. The most important catch for Sovietphiles was, of course, Sidney and Beatrice Webb, at the time arguably the most important Socialist intellectuals in the English-speaking world. Their book, Soviet Communism: A New Civilisation? appeared in two hefty volumes in 1936. (The second edition appeared in the following year, with the question mark removed.) While Stalin's Great Terror was consigning millions to the Gulag or execution squads, the Webbs were denying that the Soviet Union was a dictatorship at all but a special variety of political democracy. In her private correspondence Madame Webb was even more categorical: Commenting on the Moscow trials to H. G. Wells, she wrote that the issue was not whether the accused were guilty or innocent, "but will the counter-revolution be avoided?"
Overy admits that there was a double standard at work here. The same people who condemned concentration camps and political murders in Italy, Germany, and later Spain were speaking of countries with which many Britons could reasonably be expected to have some personal familiarity. No doubt this is true, but it is certainly not true that there was no information available on the facts of Soviet Russia in 1930s Britain. The best case he can make for these people--he obviously has considerable sympathy for them--is that many people cherished "the ideal of the Soviet Union in order to hasten the reform of Britain."
Ironically, the war that so many on the left worked to avoid in the 1930s ended up being the very instrument by which Britain was transformed in directions they had long wished: the dismantling of empire, the embrace of economic planning, and a vast expansion of the welfare state.
Overy probably could have found a way to say this in a long article, but for those who have a morbid interest in a morbid age, this volume will hold out a certain interest, particularly since so many of the assumptions--taking into account differences of time and place--that informed Britain's late-imperial intellectual classes have lately found such resonance in our universities, in our mainstream media, and now, indeed, in the highest reaches of our government.
Mark Falcoff is a resident scholar emeritus at AEI.
The Locust Years Book Review By Mark Falcoff
The Weekly Standard
Thursday, June 24, 2010
A few months ago Peter Hitchens reminded his readers in the Daily Mail that a mere 70 years ago--in 1939 to be precise--"we were the world's greatest empire. Half the globe used our currency, we controlled vast resources, and owned enormous foreign investments. . . . We possessed an enormous Navy, a modern Air Force, and, at the same time, the most advanced welfare state in the world."
Anyone casually picking up this account of Britain in the interwar period might well conclude that Hitchens was referring to another country altogether. Of course, the key to the paradox is that while all the things in the Daily Mail piece are true, there can be a crucial difference between what a country actually is and how it feels about itself. Given particular circumstances, the possession of great power and loss of nerve can go together. This is what makes The Twilight Years of more than mere historical interest for the present-day American reader.
While Britain emerged technically victorious from the First World War, that conflict inflicted grievous wounds upon its society. Nearly a million young men were sacrificed in the killing machines of the Somme and the Marne, many from the very families from which the country's leadership class had been drawn for generations. After 1919, the country was led by old (or at least older) men, most of whom lacked the energy and imagination to steer Britain successfully into the complicated shoals of the postwar period. Resources that might have been devoted to modernization of industry or new technologies had already been diverted into financing the war effort, and latent industrial strife postponed for the duration was suddenly given free rein. New antidemocratic ideologies from Eastern and Central Europe were beginning to poison the atmosphere in elite cultural and intellectual circles.
The Twilight Years is hardly a cheering volume. In some ways it amounts to a long slog through two decades of clinical depression--if a society as a whole can be likened to an individual. The major themes are the (prematurely announced) death of capitalism, a concern with eugenics, and the sudden discovery of psychoanalysis and the unconscious, the love affair with the distant (and mythical) Soviet Union, and finally, a "peace movement" which eventually foundered upon the realities of Hitler's advances on the continent.
The anticapitalist motif is perhaps the principal thread that holds much of the politics together. Overy asserts that, particularly after 1929, there was "an unspoken assumption" in Britain--even among people who were not necessarily
Marxists--that "capitalism meant chaos, while planning equaled progress." Moreover, the widely publicized assumption that capitalism always led to war opened a two-way conduit between Communists and fellow travelers on one hand, and pacifists on the other.
Fear of war was, of course, a natural and understandable concern--if not, indeed, obsession--for Great Britain in this period, and not only because of the huge losses suffered during the most recent conflict. Changes in technology (particularly the development of airpower and the sudden possibility of long-range bombing) suddenly stripped the island of a sense of physical security long granted by geography. A fact perhaps forgotten today, Overy writes, is that the antiwar movement in Britain was the largest popular cause during the interwar period, "crossing all conventional lines of party allegiance, social class, gender difference, and regional identity."
While the Communist party of Great Britain never attracted many followers, the Soviet Union itself was the subject of huge admiration by broad sections of British intellectual and public life.Nonetheless, one cannot help being struck by the naïveté and unwisdom with which the peace movement attacked the problem. There was, for example, the Peace Pledge Union, which gathered millions of signatures, or the Peace Ballot, in which Britons were invited to vote against war--as if anybody was really "for" it. Great hopes were pinned on the League of Nations--until it failed to act after the Japanese invasion of Manchuria in 1931. Sillier still was the notion that "collective security"--in other words, a paper alliance system linking Britain, France, the Soviet Union, and perhaps Czechoslovakia--combined with disarmament!--could somehow discourage voracious dictators like Hitler and Mussolini.
The peace movement collapsed slowly in the face of harsh realities. One was the Spanish Civil War, which caused many leftists to suddenly reexamine their pacifist convictions; another was the Munich agreement; yet another was the Hitler-Stalin Pact followed by the carving up of Poland which deprived advocates of "collective security" of their Soviet linchpin.
One of the central paradoxes of this period is the fact that, while the Communist party of Great Britain never attracted many followers, the Soviet Union itself was the subject of huge admiration by broad sections of British intellectual and public life. The Society for Cultural Relations Between the Peoples of the British Commonwealth and the USSR was founded in 1924; by the 1930s it could count among its luminaries Virginia Woolf, Bertrand Russell, Aldous Huxley, H. G. Wells, and John Maynard Keynes. Another organization, the Committee for Peace and Friendship with the USSR, included Ralph Vaughan Williams, Bernard Shaw, G. D. H. Cole, and John Strachey. The most important catch for Sovietphiles was, of course, Sidney and Beatrice Webb, at the time arguably the most important Socialist intellectuals in the English-speaking world. Their book, Soviet Communism: A New Civilisation? appeared in two hefty volumes in 1936. (The second edition appeared in the following year, with the question mark removed.) While Stalin's Great Terror was consigning millions to the Gulag or execution squads, the Webbs were denying that the Soviet Union was a dictatorship at all but a special variety of political democracy. In her private correspondence Madame Webb was even more categorical: Commenting on the Moscow trials to H. G. Wells, she wrote that the issue was not whether the accused were guilty or innocent, "but will the counter-revolution be avoided?"
Overy admits that there was a double standard at work here. The same people who condemned concentration camps and political murders in Italy, Germany, and later Spain were speaking of countries with which many Britons could reasonably be expected to have some personal familiarity. No doubt this is true, but it is certainly not true that there was no information available on the facts of Soviet Russia in 1930s Britain. The best case he can make for these people--he obviously has considerable sympathy for them--is that many people cherished "the ideal of the Soviet Union in order to hasten the reform of Britain."
Ironically, the war that so many on the left worked to avoid in the 1930s ended up being the very instrument by which Britain was transformed in directions they had long wished: the dismantling of empire, the embrace of economic planning, and a vast expansion of the welfare state.
Overy probably could have found a way to say this in a long article, but for those who have a morbid interest in a morbid age, this volume will hold out a certain interest, particularly since so many of the assumptions--taking into account differences of time and place--that informed Britain's late-imperial intellectual classes have lately found such resonance in our universities, in our mainstream media, and now, indeed, in the highest reaches of our government.
Mark Falcoff is a resident scholar emeritus at AEI.
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