The American Spectator

The Battle: How the Fight Between Free Enterprise and Big Government Will Shape America’s Future
By Arthur C. Brooks
(Basic Books, 163 pages, $23.95)

The worst financial crisis since the Great Depression, war weariness, Republican sleaze and in-eptitude, a magnetic Democratic presidential candidate, a supine press: all of these aligned in 2008 to bring the left to power and give it an unprecedented opportunity to transform the United States into a European-style nannyocracy. What will happen if it succeeds — and how to keep that from happening — are the themes of Arthur Brooks’s The Battle, a fierce and necessary manifesto for the renewal of a common-sense right. “America today faces a cultural struggle,” Brooks’s first lines warn. “This is not the ‘culture war’ of the 1990s. This is not a fight over guns, abortions, religion, and gays. Nor is it about Republicans versus Democrats. Rather, it is a struggle between two competing visions of America’s future.”

Brooks, an economist and the recently appointed president of the American Enterprise Insti-tute, is a data master with a popular touch. His first data point sets the stage for the rest of his argument. “Whether we look at capitalism, taxes, business, or government,” he writes, “the data show a clear and consistent pattern: 70 percent of Americans support the free enterprise system and are unsupportive of big government. By contrast, somewhere between 20 and 30 percent of the adult population opposes free enterprise and prefers government solutions to our problems.” America is thus “the 70-30 nation.” The country’s economic downturn hasn’t really budged these numbers, Brooks points out. Recent polling data show around 70 percent of Americans approving of the “free market” and 75 percent having a negative image of the “government regulation of business.” Small businesses enjoy a 95 percent approval rate. These attitudes, deeply rooted in American history, separate the U.S. from Europe’s democracies, which are much friendlier to activist government and more suspicious of capitalism.

The 30-percent coalition now running the country, more European than American in sensibility and values, breaks down into leaders and followers, Brooks explains. The leaders are America’s cultural elite, so they possess disproportionate power. They make oodles of money, usually go to grad school, and tend to work in law, education, journalism, and entertainment. While other elites (engineers and bankers, for instance) and middle- and working-class voters have been trending conservative since the '70s, this “intellectual upper class” has become steadily more statist and left-wing. And President Barack Obama and his coterie of advisers are the leaders of the leaders.

Who are the followers? They include a few geographic enclaves like San Francisco (where 64 percent of adults call themselves liberal, compared with just 29 percent nationwide), blacks, Hispanics, municipal workers, and young people. Younger Americans, some surveys have shown, are even expressing a bit of sympathy for socialism. This is a new development — the under-30 crowd had been moving rightward on many issues until the mid-2000s or so — and how much it results from Obama’s youthful charisma remains unclear. But Brooks is right to worry: “This is not just a fifth of the adult population: It is the future of the country.”

And as The Battle describes, the left wants to hold on to these young supporters by making their long-term interests align with those of big government. No wonder the Obama administration has proposed to pay off student loans for college grads who go to work for the government or nonprofits (many of which depend on government funds) for 10 years. After Obama’s tax changes and enormous stimulus, moreover, the proportion of Americans who pay no federal taxes will near 50 percent. When the non-payers outnumber the payers, most Americans will then “have no economic incentive to defend free enterprise, because it is so far from their interest to do so.” Capture the young and create a majority of tax eaters with no “skin in the game,” as Brooks puts it, and you’ve built a formidable political machine to expand government.

The 30-percent minority won power partly because it took the moral high ground and imposed its interpretation of the financial crisis, Brooks maintains. The “Obama narrative” blames not the government but greedy bankers and supposedly unregulated markets for the financial meltdown and economic crash, contends that the crisis can be solved through massive government growth and deficit spending, asserts that Main Street Americans were blameless victims, and insists that “the rich” can pay for the entire stimulus. Brooks disputes each of these points with admirable economy, explaining, for example, how Republican and Democratic administra-tions alike pushed lenders to offer mortgages to high-risk, low-income borrowers, dangerously inflating the housing bubble, and noting how many mortgage-seekers falsified information when applying for their loans. The economic research, he observes, casts doubt on the efficacy of Keynesian prime-the-pump spending. That the wealthy will somehow be able to pay for all the new debt that the Obama administration is piling on is laughable.

YET DESPITE THE OBAMA narrative’s intellectual lameness, the left has worked, with at least some success, to leverage it into “a game-changer” for American culture and society. After all, we now have budget-busting ObamaCare, Government Motors, new union protections, an FCC trying to increase its regulatory control of the Internet-and much more bad policy is on the horizon, including harshly redistributive taxation, if the right can’t bring a quick conclusion to the Age of Obama this November and in 2012. The Obama “end game” looks something like this, Brooks says: “We will have bigger bureaucracies, bigger labor unions, and bigger state-run corporations. It will be harder to be an entrepreneur because of punitive taxes and regulations. The rewards of success will be expropriated for the sake of attaining greater income equality.” America will be less able to attract the top talent. It will be less of a “gift to the world.” Friedrich Hayek’s warnings about a road to serfdom seem scarily relevant.

To prevent this denouement, the friends of free enterprise — of freedom — not only must reclaim the narrative of the crisis, but they must also reclaim the moral high ground from the left. This is the crucial battle of Brooks’s title. “More than any other system,” Brooks says, the free market society “is not just an economic alternative but a moral imperative.” It beats the competition not just for efficiency but for fairness and justice. The 70-percent majority needs its politicians and advocates to get this point and argue for it. If they can’t or won’t, the 30 percent coalition will keep winning battles it shouldn’t be winning — and eventually become a statist majority.

The forces of freedom have an important ally in the battle: human nature. The left thinks that “spreading the wealth around,” as Obama would say, will make society more just and people happier. But this attitude misunderstands the human heart, Brooks explains, reprising and updating the argument he made in his earlier Gross National Happiness. The data show that inequality doesn’t really bother us; what frustrates the spirit is closing the opportunities for earned success. The sense of meaningful achievement that accompanies earned success — doing a job well, setting down and completing a project, exerting control over one’s life and future — makes us happy in profound and lasting ways. This “is the liberty our founders wrote about, the liberty that enables the true pursuit of happiness,” Brooks says. And here the freedom agenda easily beats the com-petition, since it opens myriad possibilities for people to succeed through hard work and merit and talent and luck. The left’s redistributionist agenda — far more materialistic than the supposedly greedy right’s — winnows possibilities; resentment invariably festers.

The Battle clearly began life when the right’s prospects looked grim and publishers were rushing out books with titles like The Death of Conservatism and 40 More Years: How Democrats Will Rule the Next Generation. A year and a half of liberal rule has reminded many Americans why they don’t like the left. From the extraordinary Tea Party rallies against big government and vertigo-inducing debt to the mounting anger about cushy pension deals for public sector unions to the plummeting approval ratings of the president and the Democratic Congress, the 70-percent majority is fighting back. Even some young Obamaphiles seem to be having second thoughts: only about half of young voters are planning to go Democratic in upcoming House races, a Gallup poll reports, down from six out of 10 in 2006. (Brooks is no party man, it’s worth adding: he harshly condemns Republicans of the Bush years for their awful earmarks, bloated federal budgets, incompetence, and corruption.)

Brooks steers mostly clear of foreign policy and the social issues. The most urgent conflict right now, one that should bring all conservatives together — and in this, The Battle reads like a 21st-century Frank Meyer, a reborn fusionism — is keeping the Obama/Pelosi left from radically remaking America into a social democracy. That way lies not dynamism and growth but social poison and sclerotic decay.