The New issue of Michael Tomasky's "Democracy Journal"...
A Legal Demand from the County Palatine of Google...

Nick Eberstadt and the "Takers" Once Again: More Reflections on the General Theory of the Moocher Class

Screenshot 6 11 13 8 26 AM

Today Democracy Journal puts up Nick Eberstadt's complaint about my review of his book, A Nation of Takers, and my reply in response.

This has gone wrong.

Eberstadt--for whom I have the highest respect, and from whom I have learned an immense amount over the years--is disappointed in me, and I am disappointed in him.


Although I disagree with him on a number of policy questions, I also hold Brad DeLong’s scholarly work in high regard. Thus I was pleased to hear he was reviewing my recent book A Nation of Takers: America’s Entitlement Epidemic. I was looking forward to an intelligent, principled, and spirited critique. I was perplexed to find instead an essay [“Shrugging Off Atlas,” Issue #28] that betrayed only glancing familiarity with the real existing text I wrote. I was left to wonder: Did Brad actually read the book he reviewed?

DeLong starts by getting the publisher wrong with his very first mention of the book. A Nation of Takers was not, as he states, published by the American Enterprise Institute (AEI) as part of its “ ‘New Threats to Freedom’ series.” The actual publisher is Templeton Press, of the Templeton Foundation: It says so on the back cover. (AEI has no “New Threats to Freedom” series.)

A little later, DeLong observes that “Eberstadt’s conservative comrade Veronique de Rugy reports that 35 percent of Americans receive some ‘means-tested benefit.’” But on page 130 of A Nation of Takers, I cited Census Bureau data to exactly that effect: “As of 2010, over 34 percent of American households were obtaining means tested benefits.” Why not cite my text—instead of work by a researcher with whom I have never collaborated? Did DeLong just not read that far?

There are findings and assertions in my book that should concern all public-minded citizens. Among them: 1) the federal government has effectively been transformed into an entitlements machine over the past two generations; 2) the explosive growth of entitlement spending in postwar America has coincided with a long-term “flight from work” by adult men; 3) the government’s disability entitlements—from which over 12 million working-age Americans were drawing awards last year—are rife for misuse and abuse; 4) over the past four decades America has increasingly resorted to the device of funding its federal spending—now mainly entitlements—through borrowing, in effect taxing the Americans of tomorrow for our unprecedented levels of current entitlement consumption today.

Your readers unfortunately learn none of this, because DeLong did not bother to describe those arguments, much less evaluate or challenge them, in his 3,000-plus-word review. Did he even know those arguments were there?

Early on, DeLong writes, “We need venture no further into A Nation of Takers than the bottom of the second page….” Taken in context, this sounds like a confession.

I like a good debate—I happen to think public policy and the common weal are promoted through the competition of ideas. More than that: We obviously need a serious national debate on the entitlements question. That is why my book includes, indeed showcases, critiques of my own findings from Bill Galston (on the left) and Yuval Levin (on the right).

It is a shame DeLong chose not to show up for that same debate. It is also a disservice—not least to your readership.

My reply in Democracy Journal:

Because I have learned a lot from Nick Eberstadt over the course of my life, I am puzzled that he claims that in my review I did not show up for a “serious national debate on the entitlements question.” I’m even more puzzled that he’s taken my statement that his first serious error appears on the second page as “a confession” that I read no further in his book—especially since I go on to quote extensively from later passages in A Nation of Takers.

I cited Veronique de Rugy as my source for the estimate 35 percent of Americans receive some means-tested benefit number because I first read it in her work, long before I read the same number in A Nation of Takers.

By my count, I spent half of my review dealing with the issues Eberstadt complains that I did not write about. Government has a very proper role providing Social Insurance. As we grow older and as medicine advances, government should spend more in these sectors. I spent time trying to figure out what if any proportion of rising entitlement spending is "excessive". Eberstadt didn't.

I agree I did not deal with the fourth issue Eberstadt complains about. So let me deal with it here:

I would note that the past four decades have seen Presidents Nixon (briefly), Ford, Carter, Reagan, Bush I, Clinton, Bush II, and Obama. Under only four of those eight--under Obama appropriately, and under Reagan, Bush I, Bush II inappropriately--has it been the policy of the party in power to borrow-and-spend, and has the government been funded by and the relative burden of the debt increased by borrowing. To claim that is it a forty-year American pattern rather than a post-Ford Republican Party disorder is, I believe, seriously misleading.

My view is that when thinktanks endorse claims that both political parties are equally responsible for fiscal dysfunction, they are making it more difficult to solve American problems in order to advance partisan Republican claims.

So what is the best way to proceed from here, to try to repair the discourse?

My problem is that I think and I think and I still find that I cannot but believe that mine the right review to write. So let me reconstruct and outline my thought processes on reading and reviewing his book, in the hopes that that will enable us to somehow move forward from here…

When I agreed to review Nick Eberstadt's book, A Nation of Takers--which I think of as his take on what Mark Schmitt calls the argument of the Rise of the Moocher Class--I was expecting to read one of two well-documented arguments. I thought I might read an argument that the entitlement social-insurance state we have created, in bits and pieces since the late-nineteenth century Republican Party began to direct tariff revenue to the expansion of Civil War pensions, had landed an immense number of people in poverty-trap situations where it made no economic sense for them to apply themselves industriously. I thought I might read an argument that the entitlement social-insurance state we have created had created a moral ecology in which immense numbers of people damaged themselves by seeing themselves as worthless Moochers living off the government's teat.

Either argument would, it seemed to me, be, if properly documented, something to seriously worry about.

Yet, as I read the book, I found no discussions of high marginal tax or net-of-benefit rates afflicting substantial chunks of the American population. And, as I read the book, I found no significant discussions about how the beneficiaries of the entitlement social-insurance state viewed themselves as receiving presents--"gifts from Obama", as Mitt Romney put it--and thus as unworthy Moochers. What I found, instead, were numbers about the rise in entitlement spending that seemed to me divorced from their proper context. And what I found, instead, were observations about how prime-age male labor-force participation had fallen at the same time as the entitlement social-insurance state had grown.

Unemployment insurance beneficiaries believe that they paid for their benefits, and they are right. Social Security beneficiaries believe that they paid for their benefits, and they are more than three-quarters right. Medicare beneficiaries believe that they paid for their Medicare, and they are more than half right. Farm subsidy recipients believe that the market is stacked against them, that what they do is a special and noble profession deserving greater rewards than a rapacious world market would offer, and that their farm subsidies are only raising their incomes back to what would be fair--and they have a case. Recipients of the Earned Income and Child Tax Credits see themselves as working very hard for very little money, and performing a truly important service for America's next generation by bringing their children up right--and they are correct. None of these groups ever imagines that they might be Moochers. And since they do not imagine that they might be Moochers, how can the fact that they regard themselves as Moochers harm their self-esteem and poison their work ethic?

Moreover, we in the technocratic policy community have over the past thirty years been engaged in a war on "notches" and "cliffs": we have been broadening the base and lowering the rates on the tax side, and we have been extending program eligibility up the income scale and lowering program phase-out rates precisely to eliminate the possibility that we will give a large number of people strong economic incentives to Mooch. This had, I thought, succeeded. This had, I thought, been a point of great bipartisan pride. This was, I thought, successful fulfillment of Milton Friedman's dream of how you created a good society--one in which marginal changes in your income and status produced only marginal changes in the net money flows between you and the government, and in which important individual social-insurance and collective social-welfare goals were attained by a tax-and-benefit system in which some people's taxes were positive and other people's taxes were negative.

To suddenly be told, without Eberstadt ever wrestling with the Ghost of Milton Friedman, and without evidence of baneful effects ever presented, that this thirty-year bipartisan project was all a mistake--that came as a shock.

Moreoever, it seemed and it seems to me that we had and have good reason to expand the entitlement social-insurance state. It seems to me that there are five areas in which government spending has a demonstrated superiority over the private sector--health and disability insurance, education, old-age pensions, infrastructure spending, and military spending. It seemed to me that structural changes in our economy and society were driving the amount of money we ought to spend in sum on those five up, hence the enlargement of government. And it seemed to me that we had better explanations of the long-term decline in male labor-force participation in the form of increasing societal wealth coupled with stagnant working- and middle-class male wages.

Thus it seemed to me that the right thing to do for my review was to put my reader in the position of judge and ask for summary judgment via an intellectual 12(b)(6) motion: that Eberstadt had failed to state an argument. There seemed no possibility that his evidence for his thesis properly presented and interpreted would justify his claims because he had no evidence either about tax and net-of-benefit rates or about the moral economy of benefit receipt. And, then, it seemed to me that the right thing to do was to ask: if Eberstadt cannot present any proper evidence for his case, why does he--and Arthur Brooks, and Charles Murray, and most unfortunately Mitt Romney on his Regrettable Night of the Forty-Seven Percent and the rest of the AEI's Republican political masters--believe it?

For all this proceeds against the background rhetoric with which Nick Eberstadt deliberately placed his book in resonance with when he titled it A Nation of Takers. For example:

  • P.J. O’Rourke:: "Not for nothing is Kentucky Senator Paul named Rand [after Ayn Rand]. The premise of Atlas Shrugged applies to every maker in a world of takers. What if, pace Adam Smith, the takers do indeed expect their dinner “from the benevolence of the butcher, the brewer or the baker”? And what if the Safeway meat-cutter, the beer-truck driver, and the guy who owns the Dunkin’ Donuts franchise say to hell with 'their regard to their own interest'?  What if they go off with John Galt to a secret hidden unknown valley in the Rocky Mountains?  A lot of people will be chewing air and drinking puddle water…"

  • Ludwig von Mises to Ayn Rand: "You have the courage to tell the masses what no politician told them: You are inferior and all the improvements in your condition which you simply take for granted you owe to the effort of men who are better than you…"

  • Paul Ryan: "Let's make this country a tax shelter. Right now about 60 percent of the American people get more benefits in dollar value from the federal government than they pay back in taxes. So we're going to a majority of takers versus makers…"

And remember the original source of the "nation of takers" meme? Edmund Contoski's 1997 book, Makers and Takers: How Wealth and Progress Are Made and How They Are Taken Away or Prevented? Contoski's publisher writes:

Amazing facts that you can read in Makers and Takers:

  • A million Peruvians became infected with cholera, and 10,000 died, after chlorination of drinking water was stopped because of EPA policy.

  • In India the death toll from malaria rose from 200,000 to 3 million annually after the U.S. government banned DDT.

  • Worldwide, several times as many people die every year because of the U.S. government's ban on DDT and other pesticides as were killed by Hitler's holocaust, by both sides in all the years of the war in Viet Nam, and by the atomic bombs of Hiroshima and Nagasaki combined.

  • EPA's policy on asbestos removal results in people having greater exposure to asbestos, and to far more dangerous substances!

  • Studies show that seatbelt usage decreases fatalities slightly for drivers, but increases deaths for rear-seat passengers, cyclists, and pedestrians. Analysts say that mandatory safety equipment leads drivers to be more aggressive and take greater risks.

  • Read how EPA falsified sulfur dioxide emission studies in order to force stringent regulations on utility companies and other coal-burning industries. Learn how each $1 billion in interest on the national debt results in about 200 fatalities.

  • Discover one simple fact that would tell you that CFCs (chlorofluorocarbons) can't be destroying the ozone layer over Antarctica. And read about the NASA study that found CFCs came in "a very poor last" as a cause for lower levels of global ozone.

  • Read about how the number of personal injury insurance claims increased for various models of automobiles after airbags became standard equipment.

  • There is no evidence of global warming. The world's ice caps are not melting. The Greenland ice sheet has actually thickened by two meters since it was first measured by laser altimetry in 1980. And satellite temperature measurements show no evidence of global warming.

  • Learn how and why the public education system indoctrinates our children with the idea that government is the solution to all the problems of society.

And it became very clear to me that the resonance of the term "takers" on the American right was such that we were no longer in the Technocracy Quadrant here. We were no longer seeking a proper structure for government to advance agreed-upon American values of equal opportunity, while properly compensating for destructive market failures. We were in a very different realm indeed.

Thus I cannot but think, although I do wish it were otherwise, that I wrote the right review of Nick Eberstadt's A Nation of Takers. It still seems to me that the most interesting question is the one I tried to wrestle with: why do the AEI and its political masters believe so in their Theory of the Moocher Class?

And I am eager to learn from anyone who can do a better job of wrestling with this question than I have.

2597 words