Confronting the Conservative Nanny State: Can Progressives Stop Using Scripts Written by Right?
There is a basic political framing that shapes most debates over economic policy in the United States. This framing holds that conservatives support the market. Conservatives want people to have the option to succeed or fail on their own. If people do well, then the government should allow them to enjoy their success and not burden them with excessive taxation. On the other hand, if people fail, well that's too bad for them.
The liberal/progressive side in this frame wants the government to constantly intervene in the market to help the people at the bottom. It is prepared to tax the rich to ensure that those who are less successful still have a decent standard of living.
While this framing is very useful for the right, it happens not to be true. In fact conservatives support government intervention every bit as much as progressives. The main difference is that conservatives want the government to intervene to ensure that income flows upward. The other difference is that conservatives are smart enough not to own up to their role for government, portraying their favored interventions as nothing other than the natural workings of the market.
My book, the Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer, describes the key mechanisms through which conservatives have rigged the rules to ensure that income flows upward.
To start with the most egregious example, CEOs in the U.S. don't get paid tens of millions a year because of the free market. They get paid huge salaries because the government set rules for corporate governance that virtually allow CEOs to write their own checks. Under the current rules, management gets to count non-returned shareholder proxies as supporting their position. This is like letting incumbent politicians count all the people who don't vote as voting in their favor. In other words, it's rigging the deck.
The rules could have been written so that top management (and its salaries) is more strictly accountable to shareholders. Instead, we are told that the huge salaries CEOs can get with a rigged deck are simply the outcome of the natural workings of the market.
Trade is another area where the conservative nanny state crew has framed the debate in a way that turns reality on its head. Over the last quarter century, the United States has pursued a number of trade agreements (usually described as "free trade" agreements), the main purpose of which has been to put manufacturing workers in direct competition with low paid workers in the developing world. This is done by creating rules that facilitate the import of goods manufactured in the developing world. The effect of this policy is to directly reduce the wages of manufacturing workers and to indirectly place downward pressure on the wages of the 70 percent of the workforce that does not have a college degree.
The conservative nanny state crew pronounces this drop in wages for less educated workers to be a part of the natural process of globalization. Their remedy is to tell these workers to get the skills necessary to compete in the new global economy.
But, we could have just as easily drawn the rules differently. Suppose our trade agreements were structured to make it very easy for smart kids in India, China, Mexico and elsewhere to train to practice law, medicine, accounting and other highly paid professions in the United States. Such trade agreements would have allowed enormous economic gains (if our doctors' pay were brought down to the levels of Western Europe, it would save us $80 billion a year in health costs, almost $1,000 per family), and these trade agreements would cause income to flow more to those at the middle and the bottom.
However, the conservative nanny state proponents of free trade suddenly become arch- protectionists when the issue is free trade in the services of highly paid professionals. They want international competition to bring down the wages of auto workers and textile workers, not doctors and lawyers. (Nanny state conservatives are smart enough to know that someone else's income is a cost to them -- that's why they want cheap wages for less educated workers.)
Bill Gates is incredibly rich because the government has granted him a monopoly under which it will arrest anyone who chooses to sell or transfer copies of Windows without his permission. Contrary to what nanny state conservatives would have us believe, copyrights come from governments, not god, and they are not the only (or best) way to support innovation and creative work.
To get the whole story, read the book (available as a free e-book), but the key point is that progressives largely give away the store when we accept the framing that conservatives like markets and progressives like the government. The conservatives don't want everyone for themselves, they want the government to make sure that the rich get richer.
The public has well-founded fears concerning the efficiency and benevolence of the government. To be seen as knee-jerk supporters of government intervention is a virtual guarantee of political failure. On the other side, the market is a tool, just like the wheel. We have to figure out how to use it in a way that will lead to desirable outcomes.
Progressives can produce an agenda that appeals to bulk of the population, but the first step is to stop reading from a script that was written by the other side.
Dean Baker: Author Bio | Other Posts
Posted at 9:48 AM, Jul 10, 2006 in Economic Opportunity | Economy | Employment | Fiscal Responsibility | Government Accountability | Labor | Middle-class squeeze | Progressive Agenda | Tax Policy | public services
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