The Good News and the Bad News
As we enter a new century and indeed a new millennium, it seems appropriate to take stock of where we stand in the ongoing struggle for individual freedom and limited, constitutional government. We should remember that the big picture is pretty good. Given what the human race has gone through—conquest and subjugation, theocracy, slavery, feudalism, absolute monarchy, military dictatorship, communism, fascism, national socialism, apartheid—the political and economic systems of more and more of the world reflect a great deal of learning and improvement. Most readers of this column live in societies based largely on private property, markets, the rule of law, religious freedom, freedom of speech, and legal equality for people of different classes, races, and sexes. And because of that we have made enormous strides in the past two centuries in material prosperity, health, and life expectancy. That is a tremendous achievement.
Still, those of us with a more complete appreciation for the free society realize that we have much left on our political agenda for the 21st century. Here is a quick survey of our current political situation. First, the good news:
The Collapse of Socialism. It seemed endless at the time, but in fact the era of state socialism lasted only 75 years. With the collapse of the Soviet Union and the shift toward capitalism in China, the energy has gone out of socialism, which is no longer a significant ideological adversary to market liberalism.
Appreciation for Markets. We also see a greater appreciation for markets as an organizing principle of society. Although much of this appreciation is grudging and nonideological, it is real.
The Information Age. As Ed Crane discusses in this month’s lead article, the shift to an information economy is undermining the power of nation‐states. Global markets make it more difficult for states to impose taxes and controls on their citizens. Unprecedented access to information undermines claims of authority based on special knowledge. The shift from physical to human capital empowers individuals and makes physical control less relevant.
The New Economy. In an economy characterized by increasing labor mobility and entrepreneurship, it will be more difficult to maintain old regulatory and entitlement structures. Bureaucratic schools won’t meet lifelong education needs; industrial‐era labor regulations are increasingly onerous in an age of knowledge workers; a one‐size‐fits‐all retirement system that promises to deliver 1 percent on your investment will not long remain popular; in a world where employees move around, it’s absurd for employers to handle health care and retirement savings.
Now, some bad news:
The Collapse of the Constitutional Consensus. For more than a century Americans knew that the federal government had a very limited role. But after the federal government created veterans’ programs, and then farm programs and retirement programs, people reacted as if a piñata had burst: the federal government has lots of money, they concluded, so let’s go get it. Restoring the enumerated powers of the Constitution would solve many of our political problems, but it won’t be easy.
Dismal Political Leadership. No political leader in recent years has offered an articulate defense of liberty and limited constitutional government. The traditional American individualism and skepticism toward expansive government are still there, just waiting for leadership.
Prosperity. Hard times—like the 1970s—make voters more tenacious in holding on to their money and more skeptical of government demands for higher taxes and spending. In prosperous times like these, two things happen: more tax money rolls in and people feel flush, so politicians can go on spending sprees. That’s why it’s essential to put limits on taxes and spending whenever the opportunity arises—because politicians will never stop pushing and prodding for opportunities to spend more.
The Urge to Centralize. Despite the collapse of socialism and the growing appreciation for markets, there is a tendency to see centralization as a way of producing quality and equality in government services. Competitive systems produce better solutions than centralized systems, but people who see only a snapshot view of the world—inevitably with inefficiencies and inequalities—don’t understand the dynamic nature of competition. Ironically, the success of private enterprise may be partly responsible for this trend: companies like McDonald’s, General Motors, and IBM aren’t broken down into municipal or state divisions, so why should government enterprises be so fragmented? Obviously, understanding of the differences between voluntary and coercive entities is still lacking.
Media Bias. American journalists don’t all think alike, and they don’t get together on Monday mornings to discuss how to undermine capitalism and the Constitution. But there does seem to be a tendency among elite journalists to be more skeptical of business than of government; to think that compassion for the less fortunate entails government spending; to think that, if we know what’s best, it should be federally legislated. The rise of new media will erode the power of the agenda‐setting media, but this will continue to be a problem for advocates of smaller government.
In the long run, freedom works, and people figure that out. I have no doubt that at the dawn of the fourth millennium more of the human beings in the universe will live in freer societies than do today. In the shorter run the outcome is less predictable, and it will depend on our own efforts to capitalize on our strengths and learn to counter the trends that work against a free and civil society.