Elizabeth Warren has become an instant celebrity among liberals for her rant before what appeared to be a small coffee klatch of supporters captured on YouTube in her bid to replace Scott Brown as the Senator from Massachusetts.
The former Harvard professor, who blazed the trail for President Obama's new Consumer Credit Financial Protection Bureau (although Republicans in Congress blocked her being appointed the first head), puts forth a spontaneous declaration of liberal and Democratic claims on the American economy. I'm going to print the whole thing because I think it's worth deconstructing, word-by-word. You don't have to look any further to see why Obamaism points straight towards Greece.
I hear all this, you know, "Well, this is class warfare," this is whatever." No. There is nobody in this country who got rich on his own -- nobody.
You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn't have to worry that marauding bands would come and seize everything at your factory -- and hire someone to protect against this -- because of the work the rest of us did.
Now look, you built a factory and it turned into something terrific, or a great idea. God bless -- keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.
Got that? OK, let's take a look at what she's saying.
My first reaction on reading this is, "Wow, this is the crab bucket syndrome." It's well known among police officers, social workers and community organizers (like Barack Obama) that one of the most difficult and tragic phenomena in African-American ghettoes is that when one individual starts succeeding at something, like crabs hanging onto the legs of another crab trying to escape the bucket, everybody will impede his or her progress to the point of making it impossible for them to escape into the outside world. For a while there was a practice in eastern cities known as "kneecapping," where a young athlete who was showing promise as a basketball player would have his kneecaps broken so that he could not leave his buddies behind. Any student who tries hard to succeed at school is accused of "acting white."
"We're the ones who made you what you are!" "You never would have gotten anywhere without us!" "You owe us!" These are the common cries of people who are afraid they will come up short. And of course all this glides easily into, "You're not going anywhere unless you take us."
It's not an isolated phenomenon. It's common enough in families, particularly the extended families of developing countries. People who study immigration have found that the Senegalese salesmen who sprout on the sidewalks of New York selling umbrellas whenever it rains or the Guatemalans trying to make a living mowing people's lawns are usually sending half their income back home to their extended families in West Africa or Central America. It's an admirable act of loyalty but also a real impediment to any individual success, since workers are constantly being drained of their savings.
Developmental economists who studied the Third World in the 1960s and 1970s found this one of the most difficult roadblocks to growing a commercial economy. It is, in fact, the age-old problem of capitalism -- whenever an individual succeeds at something, they immediately earn the resentment of their neighbors who believe that if someone is getting rich then other people must be getting poor. Anyone who starts a business is immediately overwhelmed by the claims of friends and relatives -- and government officials -- demanding their share.
This produced what seemed an extremely puzzling anomaly -- that throughout the Third World the entrepreneurial sectors were run largely by foreigners, often immigrants from other Third World countries. The small business sector in Latin America was dominated by Japanese and Chinese immigrants. Cuba had a large complement of Chinese entrepreneurs who, when chased out by the Cuban revolution, moved to New York and opened a string of restaurants advertising "Comidas Cubana y Chinoise." The commercial sector in East Africa was run largely by Indian immigrants. The most important step in development, the economists argued, would be to get native peoples to accept entrepreneurial success among their own countrymen. This is what Deng Xiaoping was trying to do when he told his fellow Chinese that it didn't matter what color a cat was as long as it could catch mice.
What Elizabeth Warren is trying to do, then, is bring this Third World mentality to America. "Nobody in this country ever got rich on their own. Nobody!" "You only made it because of the rest of us." Which is to say, "You owe us, buddy -- big time."
To her way of thinking, things such as roads, law enforcement, and education can only be provided by the government. Without the state, every private business in America would be besieged by mobs trying to rip off their inventory and sell their machinery for scrap. (That "community organizers" such as Elizabeth Warren and Barack Obama would probably be leading such mobs will pass notice for now.) Let's look at the examples Warren offers:
Roads and transportation. The fact that government now owns most of the roads in the country does not mean without government there would be no roads. It simply means that road building and maintenance are mundane and unimaginative tasks that have been turned over to the government because nobody sees any chance of making money at it-- or rather that the government would undoubtedly prevent anyone from profiting at it if they tried. Many of America's first roads were toll roads built by private companies. Ferries, bridges, and commuter railroads were also private. Eventually people began to resent paying these fares and asked the government to take them over "for the good of the people." Road building has also devolved to the government because, as the landscape becomes more settled, it requires the power of eminent domain to push roads through populated areas. This is a compromise most people accept, although the details of "taking private property without due compensation" are still being worked out in the courts.
Perhaps the best example of this is the New York City subway system. The original subway line -- the Interborough Rapid Transit (IRT) -- was built in 1905 on contract by a private corporation and then leased back to it by the city government. The Brooklyn-Manhattan Transit (BMT), built shortly after, was entirely private. During the 1920s the Independent (IND) line was built by the city government to prove it could do things just as well as private enterprise. The big problem was the "5-cent fare." Because the fare had been 5 cents in 1905 when the first line was built, New York City politicians decided it should be 5 cents forever. Whole mayoral campaigns were run around "saving the 5-cent fare." Finally, just before World War II, the 5-cent fare bankrupted both the IRT and the BMT and the city took over. The fare stands at $2.50 today but must be hugely subsidized in order to pay the wages and pensions of the Transit Workers Union.
Police protection. The police power has indeed been ceded to governments for as long as there have been governments. One of the most succinct definitions of government is that it is the "entity that has the official monopoly on force." When those police disperse the mobs outside the factory owner's building, they are exercising the powers of the state. But that does not mean government is the only form of protection. In Haiti, where government authority has completely broken down, a private guard with a machine gun stands outside every shop in what is left of the commercial sectors. All over America, major corporations and many small businesses contract for private security. Nor is it just the business and commercial sector that sometimes looks beyond the gendarmes. One growing practice in upscale suburbs is for subdivisions to wall themselves off with private roads and police forces.
The alternative to government law enforcement is not no law enforcement but private law enforcement. Public authority is simply the fairest and most efficient way of achieving domestic tranquility. But if people find it inadequate, they will not succumb to violence. They will look for private security.
Education. Education? What can we say? Warren may think "the rest of us paid to educate" today's workers but the poor state of education in the workforce is now regarded as one of the greatest vulnerabilities of the American economy. The government monopoly on education is being challenged on all fronts, through home schooling, charter schools, and the campaign for vouchers. People choose these alternatives because they believe the government isn't doing a very good job.
The unraveling of public education corresponds precisely with the rise of teachers' unions, which, like all dominating unions, run a business for their own benefit rather than the benefit of consumers. Teaching assignments are made on seniority rather than merit, labor contracts calculate teachers' break time and lunchroom duties to the second, and colleges of education participate in the charade of awarding graduate credits for courses offered on weekends or during spring break so teachers can move up the "grid" to higher pay. In the classroom, first graders study the rainforest and chant "Man did it" to an honor role of extinct and endangered species almost before they learn their ABCs. For this we should be thankful?
Warren's is making the Hobbesian argument that without the government life would be solitary, poor, nasty, brutish and short. So shut up and pay. It worked well to justify the absolute monarchies of the 17th century. Forty years after Leviathan, John Locke published Two Essays on Government, which posited the doctrine of Natural Rights. The Natural Rights argument says people have a right to choose differently if they don't like their governments and has proved to be much more compatible with democracies.
The problem with defending "you'd-be-nowhere-without-us" government is that government is no different from any other organization in society -- it seeks its own aggrandizement. AT&T, General Motors, and Microsoft would love to have world monopolies, controlling all the resources and expanding into every corner of people's lives. But they are limited by competition, the dynamics of the marketplace, and the need to win people's consent in order to market their products.
Government is different. It expands by fiat, through legislation, through taking advantage of emergencies, and by declaring that private entities can't be trusted and government intervention is necessary. Most of all it grows by raising taxes and hiring more and more people so that soon its voter base approaches a majority of the electorate. In Greece, 14 percent of workers are employed by the government. In New York City the figure is slightly higher. Add in family members dependent on a government paycheck and you're getting close to a third of the population. And that doesn't even count the people who live off government benefits. When you reach this kind of critical mass, all kinds of things become possible. In Greece, the government is now trying to balance its budget by raising the property tax. It has given up tax collection, however, since evasion is already endemic. Instead it is trying to collect the property tax on the bills from the government-owned electrical company. But the electric workers are unionized and are refusing to collect the tax! Carry mooching to its logical conclusion and you end up where Greece is now.
What Elizabeth Warren is expressing, then, is the moocher's credo, updated to fit contemporary America. In the 1930s, liberals argued that government could run businesses better than private companies. They didn't need to make a profit and could eliminate "greed." They would install college-educated engineers and professionals to replace the ignorant plutocrats and cowboy capitalists that ran corporate America. Now liberals are content to regulate business instead of owning it. They have become parasites instead of carnivores. And so the rallying cry has become: "You couldn't do it without us! Where's our fair share?"
The enemy of all this is individuality -- individual enterprise, individual responsibility, individual initiative, and individual creativity. There is nothing more difficult in the contemporary world than starting your own business -- having the courage to risk your savings and years of work effort and defying some traditional way of doing things by saying, "I'll bet I can do this differently, and better."
It is hard to imagine America without this.