I wondered when the socialists would start coming out of the woodwork. The answer, if the behavior of E. J. Dionne is indicative of the species, is now. In a column called “Capitalism’s Reality Check,” Dionne tells his readers that “the biggest political story of 2008 is getting little coverage.” And what, pray tell, would that be? The remarkable turn around in Iraq? That, surely, is a pretty big story, and one, moreover, that has been assiduously ignored by the mainstream media? Or maybe it’s the news that the approval rating of Congress has dipped to single digits (an historic low, I believe)? That’s a big story if only because it bears crucially on an important foundation of democracy: public confidence in our political institutions. And, again, you don’t hear much about it from the mainstream media who, when it comes to approval ratings, are considerably more interested in telling you how low President Bush’s rating are–never mind that they are twice as good as that enjoyed by Congress.
But, no, neither is what E. J. Dionne has in mind. His Big Story “involves the collapse of assumptions that have dominated our economic debate for three decades.” You know, assumptions like low taxes and free markets and deregulation are good for productivity and central planning, government intervention, and egalitarian economic policies are bad for productivity. Those were the policies–the capitalist policies–that, over the last three decades that Dionne cites, lead to the greatest creation of wealth in history. In the early 1980s, remember, the top marginal was 70 percent. In 1982, the Dow Jones Industrial Average dipped to 776–that’s seven hundred and seventy-six–and many were the bulletins alerting us to the impending “Death of Equities.” What happened in the succeeding decades? Capitalism happened. Republican Presidents pursued tax-cuts and free-market policies, they did what they could to stymie economy-strangling regulation. The result? The Dow is now over 11,000, and everybody, even E. J. Dionne, even, alas, Barney Frank, is much richer now than they were in 1982. (Congressman Frank is not being frank–indeed, he was either being culpably uninformed or disingenuous–when he says that the huge, worldwide economic boom of the last few decades was “monopolized by a very small number of people.”)
We are also going through a painful moment as the subprime crisis (brought about, at least in part, by liberal politicians demanding that the banking industry loosen their lending requirements) and soaring energy costs batter the economy. But this too will pass–unless the socialists get their way. E. J. Dionne tells us that “The old script”–i.e. the script that over the last few decades created trillions of dollars in wealth–“of is in rewrite.” He then cites Representative Barney Frank–Barney Frank!–who warns that “We are in a worldwide crisis now because of excessive deregulation.” Hello, earth to Barney? Let’s have a little lesson, shall we, Congresman, in the difference between post hoc and propter hoc.
Of course, E. J. Dionne’s valentine to the return of socialism is not an abstract exercise, it is a move in the game of partisan politics. Hence his peroration: “In the campaign so far, John McCain has been clinging to the old economic orthodoxy while Barack Obama has proposed a modestly more active role for government.”
Let’s parse that, shall we? John McCain “clings”–a bad thing, “clinging”–to an “orthodoxy.” Orthodoxies are bad, too, right? Politicians can’t quite bring themselves to say we want heterodoxies, partly because not enough people are familiar with the word, but mostly because it not heterodoxy but just Something Different (Change!) that sells. But since E. J. Dionne advises a “reality check,” shouldn’t he recognize that McCain is not some much “clinging to an orthodoxy” as subscribing to sound economic principles that have fuelled the longest bull market in history? (That sounds different, doesn’t it?) And as for Obama’s “modestly more active role for government,” when you stop laughing at the distinctly immodest, er, fib , start totting up the ways Obama wants to run your life and take your money. (Think government-mandated “service,” think elimination of the cap on social security tax, think raising the tax on capital gains–and that is just the beginning.)
The thing that is so depressing about E.J. Dionne’s litany on behalf of socialism is that we have been down this road before. The road was accurately denominated by Friedrich Hayek: it’s called the road to serfdom. We’ve been there before. Do we really want to go there again?