Can the Leviathan Be Stopped or Slowed?

Tuesday August 24th, 2010   •   Posted by Robert Higgs at 4:44pm PST   •  

LeviathanIn a recent commentary titled “Diagnostics and Therapeutics in Political Economy,” I endeavored to show that an analytical understanding of past growth in the government’s size, scope, and power does not permit us to prescribe effective means of stopping or slowing this growth, particularly any simple silver bullet remedy, and I specifically disclaimed any personal knowledge of what is to be done toward this end. Responses to this commentary, some of them from keenly intelligent friends of mine who insist that diagnostics and therapeutics must be firmly linked, lead me to believe that I did not make myself sufficiently clear.

One respondent wrote, “Higgs must be speaking with tongue in cheek, for a man of his intellect simply must have a few solutions at least.” Well, yes, on one level, I have many “solutions” to propose. The problem comes when we ponder why I’ve just put quotation marks around the word solutions. The reason pertains to the links that connect my understanding of why government has grown with measures that might be taken to stop or slow its ongoing growth.

My understanding of the process by which government has grown in the United States and many other countries since the late nineteenth century is not easy for me to summarize briefly. It involves (1) a structural-ideological-political process operating in a persistent manner to produce long-term trends, (2) a crisis-ideological-political process operating during a series of discrete episodes of national emergency and (3) interactions between these two processes, which should not be understood as independent of one another, but as identifiable aspects of the single herky-jerky historical evolution sometimes regular, sometimes erratic of a politico-economic order. One upshot of this complex process might be seen if we were to examine a series of snapshots at, say, thirty-year intervals. Each snapshot would show us a society with a different composition of economic activities, production techniques, occupations, demographic attributes, and so forth, a different composition of ideological identifications, understandings, and loyalties, and a different configuration of political leanings, organizations, and institutions reflecting these structural and ideological differences. To oversimplify, we might say that the overall process creates usually gradually, but occasionally abruptly a changing set of vested interests among the population, but in this characterization we would have to interpret the idea of vested interests more broadly than usual, so that it includes not only people’s interests in pecuniary payoffs, but also their interests in ideological outcomes of various sorts. (My views in this area have been developed in a series of personal engagements [as a teacher, consultant in regulatory proceedings, and expert witness in legal proceedings] and in a series of research efforts, the most prominent results of which are reported in my books– Crisis and Leviathan, Against Leviathan, Depression, War, and Cold War, and Neither Liberty Nor Safety –to which the reader is referred for a more detailed account of my views on this matter, among others.)

Now, with this rather desperately compressed vision of the complex process by which the government has grown as our background, let us return to my solutions, that is, to my proposals for stopping or slowing further growth of government. In doing so, however, we must recognize that political solutions that clash strongly with the currently prevailing array of vested interests (broadly construed) probably cannot be implemented. For me to suppose otherwise would be inconsistent, because doing so would be tantamount to rejection of my own interpretation of how those interests came into being in the course of the historical process just outlined. At least within somewhat flexible limits, a society’s socio-economic structure, ideological postures, and political institutions must cohere. At a particular point in time, many conceivable (and in my view desirable) political reforms are not feasible.

At the moment, many people are enamored of the solution that calls for abolition of the Federal Reserve System. I certainly agree that the Fed has played an integral (but not an indispensable) role in the growth of government in the United States since 1913. But once one has demanded abolishing the Fed and subsequently found that it is still in operation, what does one do?

Various next steps might be suggested, such as sponsoring lecturers who explain how the Fed has adversely affected economic prosperity, peaceful international relations, and liberty. From time to time, I have myself given such lectures to audiences that ranged from ordinary Americans to social scientists to Latin American bankers, and, of course, many other speakers have presented similar lectures. All right, we’ve given our lectures, and the Fed is still operating, so what should we do next? Give more lectures, in an attempt to influence the thinking of more people? Or perhaps mount a political movement aimed at abolition of the Fed?

If one chooses the direct political option, where does one get the financing for it? Who will organize it? Who will lead it? What actions will it take? Will it try to place sympathetic candidates on the ballot for election to Congress? Will it attempt to influence sitting members of Congress by bribing them with campaign contributions or by threatening to recruit constituents to vote against them in the next election? My point is that once we select a specific means of stopping or slowing the government’s growth, an endless series of follow-up questions presents itself, as we encounter one problem after another, each of which must be solved successfully if we are to make headway.

No doubt the greatest obstacle of all to any such effort is that thousands of organizations are currently working, directly or indirectly, to promote further growth of government. A 2005 article in the Washington Post placed the number of registered lobbyists in Washington, D.C., at more than 34,750 and reported that their business was booming, creating a gold rush on K Street. Many of them have well-equipped offices, large capable staffs, including legions of lawyers, and established connections with incumbents in Congress, regulatory agencies, and other government offices, not to mention their friends on the courts. They also have millions upon millions of dollars to pour into their efforts to win friends and influence people, including the same mass electorate that an anti-Fed or other anti-government-growth political movement presumably seeks to influence. At this point in the historical process, anti-Fed proponents face a fabulously wealthy, tightly connected, deeply entrenched conglomeration of opponents who would sooner confine you, me, and all our friends and relatives at Guantanamo for nonstop torture than give up the Fed, which has long served, and continues to serve, their interests exceedingly well. So, yes, we can try to mount a political movement to abolish the Fed, but, given what we are up against, what chance of success do we really have? One in a thousand? One in a million?

Given this reality, if I offer as a solution to the ongoing growth of government that we abolish the Fed, my proposal solves nothing. It only raises a series of other difficult questions, each one of which leads to another and another and another. No political realist was surprised when, according to an October 30 Bloomberg report, Ron Paul, the Texas Republican who has called for an end to the Federal Reserve, said legislation he introduced to audit monetary policy has been gutted while moving toward a possible vote in the Democratic-controlled House. If the powers that be are not even willing to permit a vote on a bill with 308 co-sponsors aimed at making the Fed’s decision-making more transparent, does anyone really believe that those same powers would stand idly by while the Fed was abolished?

Nor is abolition of the Fed unique in this regard. One might propose abolition of any number of government departments or agencies for example, the Department of Education, the Department of Energy, the Food and Drug Administration, the Securities and Exchange Commission, and countless other government bureaus and find that in each instance one runs up against another fabulously wealthy, tightly connected, deeply entrenched conglomeration of opponents.

One might alternatively propose simply to reduce government spending across the board, without trying to reconfigure the government’s organization chart. The obstacles here, however, are if anything even greater, because thousands of powerful interest groups are currently seeking to increase government spending. Of course, each wants mainly an increase in the portion of government spending that enriches its own members, but the budgetary process has evolved, along with the committee structure of Congress, to facilitate a gigantic logroll, so that each year nearly every predatory interest group of any consequence tacitly agrees to refrain from blocking the other predators if they will refrain from blocking its own raid on the Treasury. Committee chairmen and ranking minority members are paid off as required to achieve this massive predation. Hillary Clinton used to complain about a vast rightwing conspiracy, but if one wants to see a genuine mega-conspiracy, one need look no further than the nexus of members of Congress and the thousands of well-organized and well-financed special-interest groups that support these politicians’ perpetual reelection in exchange for their direct or indirect channeling of almost unimaginably huge amounts of the public’s wealth into these special interests coffers.

So, yes, one might propose, say, a balanced-budget amendment to the Constitution indeed, by now this proposal is hoary with age. Political realists understand, however, that getting support for such an amendment is diabolically difficult, and, even if one were to be ratified, the members of Congress would simply install the appropriate smoke and mirrors to conceal their violation of this constitutional restraint, as they installed such circumventions on previous occasions to violate their own rules for spending restraint. Does anyone still recall the Gramm-Rudman-Hollings Balanced Budget and Emergency Deficit Control Act of 1985?

It appears, then, that among the critical difficulties of restraining the growth of government is the obvious fact that even when restraints are enacted into law, the government will not obey that law. Needless to say at this point, constitutional amendments are not worth the parchment on which they are inscribed. After all, the Constitution still contains the Ninth and Tenth Amendments. With those amendments and three or four bucks, you can get a latte at Starbucks.

I trust that by this point I need not belabor my point at greater length. To recapitulate: solutions to the ongoing growth of government are available for a dime a dozen. I have a bag full of them myself, and every one of them is utterly worthless as a means of achieving the ultimate goal. Every genuine solution must be carried through, and any serious solution will require enough people and money to carry out the activities necessary to bring it about. Marshalling people and money may in turn require ideological conversions on a substantial scale, which themselves may require a great many people and a great deal of money, if such conversions are possible at all, given the existing configuration of vested interests (broadly construed).

Moreover, another potent constraint always lurks in the background. Although we need not spend much time at present in dwelling on this issue, the fact remains that if any truly effective measures were approved to rein in the government, the rulers in all likelihood would resort to whatever legal or illegal violence proved necessary to prevent those measures from taking effect. Thus, I am quite sure, for example, that if Ron Paul were ever, by a miracle of miracles, to be elected president, he would not live to take the oath of office. Opponents of the government’s ongoing growth must bear in mind that we are dealing with violent, heavily armed, utterly unscrupulous people who, if pushed to the brink, will stop at nothing to retain their power and privileges.

I welcome anyone’s proposed solutions to the ongoing growth of government, and I wish all such proposals success, however much I doubt the likelihood of their success. I do not believe, though, that a substantial prospect of success is necessary to justify one’s efforts in resisting the ongoing growth of what is at bottom a gigantic criminal enterprise. To resist its further growth is simply the decent thing to do, regardless of whether one expects to succeed.

And even those who believe, as I do, that the chances of success in such efforts are extremely small can take heart from the knowledge that ultimately this criminal enterprise will attain such bloated size and scope that its own survival will no longer be possible, and it will implode, as the Soviet Union and other similarly overreaching politico-economic orders have imploded. Governments that grow and grow ultimately find that their predation becomes greater than their prey can support, at which point such predators are doomed. Thus, the present system of government in this country and many others contains the seeds of its own destruction, even if those of us who abhor it cannot stop or slow its continued growth in the near term.

Some of the younger people among us may live long enough to help in picking up the pieces and beginning anew. One hopes that the new beginning will rest on a less coercive, more voluntary basis than the present system. Otherwise, it will be destined only to trace the same predatory rise that the present system has followed and to arrive at the same self-destruction that ultimately awaits our own politico-economic order.

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