The labyrinth connections of persuasion
(c) Can Stock Photo / focalpoint

The more things change, the more they stay the same. — Translation of a French epigram by Jean-Baptiste Alphonse Karr: “Plus ça change, plus c’est la même chose”

Despite the kernel of truth in this famous epigram,  the long sweep of history teaches us it is fundamentally false. About a millennium ago, the timescale on which human world views (weltanshauungen, religions, ideologies) were fundamentally changed was measured in centuries. In our time, however, with increasing connections between human minds offered by the internet and televised news, and with accelerating advances in science, this timescale has shortened to decades. It would be extremely expedient and opportune for us now to find yet another revolution in Western world views. The modern challenges the Western world faces are truly existential in nature. Neoliberal and progressive minds will have to adjust if we are to survive.

The Ideological Crisis In The West

Yet, many of the pundits  I read depend on the continuity claimed by Jean-Baptiste Karr. Any change they see is strictly on the margins. Most decades, such a conservative view would be justified by cultural inertia. People expect any changes to be relatively modest, even after a change in power between political parties. Government roles, power, spending, and regulations might marginally shift with a change in the ruling political party, but the fundamental nature of government changes little. With the singular exceptions of Ronald Reagan and Donald Trump, both American parties have acquiesced to the growing government control over society initiated by presidents Woodrow Wilson and Franklin Delano Roosevelt almost a century ago. From what little I can perceive, the situation appears to be very similar in Western Europe.

Unfortunately for us, we are living in a period where a historical dialectic is forcing us to confront multiple existential crises arising from government policies. Contradictions between what we want for our country, what our ideologies tell us we can do to get what we want, and the consequences flowing from the resulting policies are threatening to destroy us. Most of these impending catastrophes are economic in nature, others concern national security, with some related to social problems.

Over the past one to one-and-a-half centuries, Western governments have accepted an increasingly dirigiste role over society, exploding government spending as a share of national income. As governments accept the demands of citizens and voters to attack the serious problems confronting them, the dirigiste governments create increasingly expensive programs to “solve” those problems. Yet somehow those problems never seem to get solved. What is a serious dirigiste government leader to do but to double down and request the citizens to grant him/her additional powers and economic resources to finish the problems once and for all? As a result over time, increasing amounts of social and economic power flow from the individuals making up society to the supposedly benevolent government ruling them. One would think an ordinary citizen would ask why government never seemed able to solve the problems, whether those problems were ones of continued long-term economic growth, of increasing inequality in wealth and power, or problems in national security.

The former British Prime Minister Margaret Thatcher once remarked that “the problem with socialism is that you eventually run out of other people’s money.” This is a problem not just with explicitly socialist regimes, but with somewhat lessor dirigiste regimes as well, Take for example the mandatory entitlement spending (Medicare, Medicaid, and Social Security) of the United States. If you were to nonlinearly fit exponential growth curves to total government revenues and to total entitlement expenditures (plus interest on the national debt), and then extrapolate those two curves to the year 2045, you would get the plot below.

Of course, taking this plot seriously assumes that government spending and revenues do not appreciably change their behavior over the extrapolated period. However, if government spending habits on entitlements do not change and revenues do not appreciably change their growth rate, then by April 2031, just the expenditures on mandatory entitlements plus interest on the national debt alone would be enough to absorb every single penny of government revenues. There would be nothing left over to defend the country, to fund the federal court system, to fund the Congress, or to do anything else! What would happen then to national security when the Defense Department and U.S. armed forces go out of existence for lack of resources to support them?

Then there is the behavior of stagnating economic growth throughout the West to consider. Also, as dirigiste governments attempt to grapple with this “secular stagnation”, they seem to move inevitably toward more authoritarian government. The mechanism for democracies evolving toward more autocratic government seems to be involved with the destructiveness of government actions on not just economies, but on chaotic social systems of interacting human beings in general. Ruling dirigistes (progressives in the United States) will legislate increased government power to address one social or economic problem or another. They will then discover that although the direct applications of the new powers might (or might not) ameliorate the addressed problems, they also usually create unforeseen side-effects that are often of similar or greater malignity for society. A sobering observation of this effect was written by the late Senator Daniel Patrick Moynihan in 1965. The U.S. Department of Labor report, entitled The Negro Family: The Case for National Action and also called “The Moynihan Report”, noted how Lyndon Baines Johnson’s War on Poverty would be destructive to the black family. A later study by the Urban Institute in 2013 showed that it had been destructive not just to black families, but to white and hispanic families as well. The basic problem is chaotic human social systems react to government actions in typically unpredictable, and usually unpleasant ways.

In reaction to these kinds of government failures, dirigistes — having faith in the application of government power to solve social problems — figure out a further ad hoc increase in government powers to “solve” the newly arising problems created by the old applications of government authority. Due to the complexity of chaotic systems, this chain of evolution toward ever more autocratic government will not end until one reaches the end state of a completely fascist government. The Democratic Party in the United States displays a definite penchant for this kind of evolution.

Besides the crisis thrust on us by unsustainable government spending and the authoritarian tendencies of dirigistes, there is a seeming contradiction between international free-trade and national prosperity. Because of the off-shoring of American jobs, many on both the Left and the Right have become hostile toward free-trade. An at least partial return to mercantilism is advocated by some. Yet, substituting foreign production for domestic releases the U.S. capital previously devoted to the production of the substituted goods. The foreign supply of those goods also reduces their prices in American markets. Then, what the loss of American jobs and businesses to overseas indicates is an American economic failure to adjust to foreign competition, and to reinvest the freed-up capital.

Why is that released capital not reinvested? Again, rather than foreign competition being the fundamental threat, we seem to be our own worst enemies by limiting the capability of our own companies to adjust and earn profits. This gives those companies disincentives to reinvest the liberated capital back into new production and jobs. Both government economic regulations and taxes in the past have made our companies uncompetitive internationally.

Clearly, the manner in which we govern ourselves has somehow become dysfunctional. Before any of these existential problems can be eliminated, the American people will have to gain a much better understanding of what is causing them. What this probably means is a large fraction of either progressives or neoliberals will have to be converted to the side of their ideological opponents. Otherwise, cultural inertia will carry us ever further toward disaster with nothing changed about government dominance over human affairs. Just how malleable are the beliefs of neoliberals and progressives?

The American 2018 Midterm Elections

The first possible hint  of the influence of neoliberals and progressives on each other would come with the midterm elections of 2018. The 2016 elections were remarkable for the foul mood of the electorate toward their ruling elites and the rebellion of many against them. This rejection by the electorate should give the academic, political, and economic elites plenty of motivation to come up with answers for why past government policies just made our problems worse more often than not. Merely reiterating standard policy positions will no longer cut the mustard. The 2018 elections will give us a scorecard for which side the people believe most.

However, given the intemperate and reflexive response of “total resistance” by progressive elites to Republicans, we are probably unlikely to see any move by them toward neoliberal views. Their primary concern right now seems to be to find the wherewithal to impeach Donald Trump, and to shame those who are degenerate enough to support the Republicans. Introspection into their fundamental premises and beliefs does not seem to be a priority for them.

Neoliberal elites also seem mostly impervious to progressive persuasion. There were a few GOP congressmen who would not support repeal and replace of Obamacare, so the progressives might pick up a small number of putatively neoliberal congressmen to support them on some issues. This is a problem for the GOP primarily in the Senate, where despite the Republican majority they do not control that part of Congress because they do not have the 60 votes necessary to invoke cloture on filibusters.

This leaves the balance of power and the decision of what kind of country we will have right where it ought to be: in the hands of ordinary people making up the bases of both parties. How persuadable are the minds of those making up the two bases? For several possible reasons, public opinion polls have become increasingly inaccurate, so we will probably not know how their opinions are moving until the only poll that counts is taken in the voting booth.

If this time was like 40 years ago toward the end of the Jimmy Carter administration, I would be almost certain Democrats would get thrashed this coming November. Nevertheless, this is a very different time when a new generation, the Millennials, are increasingly entering the electorate. Over the decades since the 1960s, progressives have dominated the teaching of students in high school and university. The leftist domination of American higher education is something that can be rigorously demonstrated. The results of this leftist domination can now be found with the millennials being the only living American generation to be favorable toward socialism. In 2014 a Reason-Rupe poll asked of various age groups, “Would you say your opinion of Socialism is very favorable, mostly favorable, mostly unfavorable, or very unfavorable?“. Graphing the number of net favorable and net unfavorable responses versus age group gave the plot below.

With millennials being a large voting bloc, they are a wild card whose effect can not be easily predicted. If they vote in large numbers they could return control of Congress back to the Democrats. Nevertheless, in the last general election the electorate were clearly unhappy with the previous eight years of Obama’s policies, both domestic (Obamacare, Dodd-Frank, environmental and energy regulation, and other aspects of economic policies)  and international. They were also evidently disgusted with the corruption of the Democratic Party, as exemplified by Hillary Clinton. Donald Trump may have just barely won his race for President, having lost the popular vote but won the electoral college, but the Democrats were hammered most everywhere else, in state and local elections as well as in congressional elections. After the 2016 elections, the GOP controlled 69 of 99 state legislative houses, the most in almost a century.

In addition, Trump has done a good job in restarting economic growth over the past year, primarily with a partial deconstruction of the federal regulatory state. In addition, with the recent passage of the Tax Cuts and Jobs Act, Republicans have taken away corporate incentives to flee the country and become foreign companies through corporate inversion. The tax reform has greatly improved the competitiveness of U.S. companies with their foreign competition. Assuming we are living in the neoliberal universe and not the alternative one in which progressives live, all of these changes will mean an increased economic well-being for the American people by election time.

This does not mean Republicans will have an easy time at the polls this November. Nevertheless, I find it hard to believe most people would like to return to Obama’s domestic or foreign policies. If they felt foul-tempered about them in November 2016, I would be flabbergasted to see the electorate vote this coming November for those policies — or for ones even farther to the Left. Then again, I have been flabbergasted before.

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