Speaker's Notes for: Concrete Economics @ SXSW!: Speaking 12:30 PM Meeting 10AB Level 3 :: Signing 1:00 PM Bookstore Level 3:
- Small book
- Readable book
- Important book (we think)
- America's political-economic governance from 1787-1975 or so was extraordinarily successful
- America's political-economic governance since 1975 or so not so
- What changed?
- America's political-economic governance took a destructive turn, an ideological turn, about 1975
Hold It!: Wasn't America Governed by Political-Economic Ideologies Before 1975?
- There were strong ideologies:
- Jefferson's agrarian ideology
- Madison's (early) small-government ideology
- Calhoun's Herrenvolk ideology
- Lochnerites--the claim the Constitution imposed Herbert Spencer's Social Statics
- But they all lost in the great political-economic scrum
- Hamilton overcame Jefferson
- Even Madison and certainly Madison's successors overcame Madison
- Lincoln overcame Calhoun
- Teddy and Franklin Roosevelt overcame Herbert Spencer and the Lochnerites
What, Then, Did Govern America from 1787-1975?
- Hamilton's state-led push for commerce, industry, finance
- A very heavy governmental role in westward expansion--very bad for the Amerindians, very good for the settlers and the settler economy
- Lincoln and his successors' push for the acquisition of capital--farm capital via homesteads, human capital via education, plus corporate capital
- Teddy Roosevelt's Progressive curbing of overweening Gilded-Age power
- All of these were ruthlessly pragmatic: looking not at ideology as a guide but at the world, and what seemed likely to work to increase popular wealth
But the New Deal! FDR Was Ideological!
- FDR's New Deal was the antithesis of ideology
- FDR tried everything
- Agricultural subsidies
- Social insurance
- And he reinforced what seemed to work
- The New Deal policies that survived became an ideology, but they started out as the most ruthless pragmatism
- And Eisenhower:
- Highways, automobiles, suburbs, massive federal support for technology
- But also fear of the military-industrial complex and a strong desire neither to break inherited things from the New Deal the worked
- Eisenhowerism was, as Daniel Bell wrote, an attempt to institutionalize the permanent end of ideology
So What Has Gone Wrong in the Past 40 Years?
- Belief that the inflation and oil shocks of the 1970s demonstrated that Eisenhowerism was tapped out
- And the fault laid to insufficient love of the free market (and excessive big government)
- Hence the big push for:
- Spending two Pentagons on excess wealth for our overclass in an attempt to give them "incentive"
- Spending a Pentagon on excess health care administration and excess unnecessary and harmful treatment
- Deregulation and financialization leading to a Pentagon's worth of waste in over-financialization
- Is corporate control better? Is risk-bearing more advanced?
- Plus two additional Pentagons' worth of waste in permanent damage from the financial crisis
- The only rich capital-inflow economy in history
- A really rich country should be exporting capital
- And leveraging its innovative, intellectual, and human-capital expertise over ever-growing communities of engineering and entrepreneurial practice
- To some degree, we have been doing the second
- But we have been letting "the market" greatly reduce the scale
- From the middle-class perspective, 8 Pentagons worth of waste over the past 40 years--all of them driven by ideology (and interest)
What to Do Next?
- All such books are supposed to end with: MY PLAN
- We refuse: such "my plans" are never convincing
- What we do seek to convince you of is this:
- The world is a complicated place
- The world surprises you--and the more bound you are to your ideology, the more you will be surprised
- Feedback and pragmatism are better than ideological oversimplifications
- Arguments against policies of the form "this breaks ideological principle X" should have much less purchase than we give them
Today That Principle Leads to a Total Rejection of the Republican Party and All of Its Works
- But that fact is a judgment on the Republican Party as it is currently constituted
- And whatever parties we have in 30 years will be equally vulnerable to ideological viruses--as vulnerable as were jefferson, Madison, Calhoun, the Lochnerites, and more recently the Bushites, Cruzites, Rubites, Gingrichites, and even the Kasichites.
- We need to defeat them and be pragmatic--with Hamilton, the later Madison and company, Lincoln, Teddy and Franklin, and Ike...