Contributed by Chriss Street. Newport Beach, CA.
Four years ago, Nobel Prize winning economist Joseph Stiglitz and the ultra-liberal Roosevelt Institute, where he serves as Senior Fellow, enthusiastically heralded the 2008 election as the beginning of at least a decade of continuous expansion of government intervention into the American economy. Stiglitz trumpeted the capture of the Executive and Legislative branches of the United States government by the Progressive wing of the Democratic Party for the first time since the 1970’s as the public’s endorsement of new social initiatives that would rival the Great Society’s Medicare, Medicaid, and education funding that began with the 1964 election of President Lyndon Johnson and continued through 1980 under Nixon, Ford, and Carter. But it has come as a severe shock to Stiglitz and the Roosevelt Institute that voters have already turned against the values of the days of disco.
Federal government spending grew 60% faster from 2008-2012 versus 1964-1968, by increasing the national debt four times as fast:
Government Statistics 1964-1968 2008-2012
|Government Spending||+ 16%||+27%|
|National Debt||+ 16%||+64%|
It took 16 years and four Presidents before public opinion turned against entrusting the economy to big government with the election of President Ronald Reagan. But the record increases in spending and rise of the national debt appear to have destroyed voter support for government and rehabilitated faith in free markets in just four years. According to the latest Rasmussen Reports opinion poll:
- Only 22% of voters accept President Obama’s suggestion that government investment is what made America great, versus 69% who think free enterprise deserves the credit.
- 66% of voters believe crony capitalist political connections, rather than price and quality; control the awarding of government contracts.
- Only 22% of voters believe society become fairer and economic inequality would decline in if the U.S. had greater government regulation.
- 60% of voters continue to believe American society is generally fair and decent.
- Just 23% of voters say increased government spending helps the economy.
Exasperated by the public’s failure to appreciate the virtues of central planning, the influential Roosevelt Institute hosted the “Rediscovering Government” conference in New York last week. Instead of opening the conference with a Pledge of Allegiance or American Flag Salute, Senior Fellow Jeff Madrick bellowed what might best be described as the bureaucrat’s prayer:
“There is no economy without government.
There is no America without government.
Government doesn’t have a role;
it is integral.”
In the keynote address, Joseph Stiglitz rationalized the reason the American public is so wary of government is they have been hoodwinked by conservatives for the past 40 years to value a false ideology that free market economies are superior to government central planning, just because free markets produce greater gross national product. The professor vociferously argued: “most Americans don’t realize that we are no longer the country of opportunity that we think of ourselves, that America today has less equality of opportunity than any of the other advanced industrial countries.” He declared only healthy societies have strong governments, because his research proved: “the reason the invisible hand often was invisible was that it wasn’t there.” Stiglitz concluded by stating that most Americans don’t realize how bad we’re doing, including the fact that “the median income of a full-time male worker today is the same as it was in 1968.”
It is interesting that Stiglitz did not take ownership of the 12 years after 1968. The 1970’s was the decade of the greatest concentration of public sector control over the American economy since World War II. The robust Congressional spending that began with President Johnson’s Great Society is blamed by most economists for causing the highest inflation since the Civil War. High inflation hammered American business profitability, which drove double-digit unemployment. The skyrocketing oil and commodity prices, coupled with rising unemployment, triggered years of stagflation misery in the late-seventies. By the end of the decade end, vast swaths of abandoned American factories turned the U.S. mid-west into the “Rust Belt.”
It is precisely because the memories of the wretchedness of the 1970s that the public has so quickly turned against deficit financed rapid growth of government. Tom Wolfe coined the 1970s the “Me Decade”, a period he described as undermining the long held communitarian belief of “we are all in this together” in favor of selfish individualism. Siglitiz and the Roosevelt Institute may still believe in the big government of the 1970s, but public opinion polls continue to show that few Americans are interested in repeating the experience.
Enjoy reading WOLF STREET and want to support it? Using ad blockers – I totally get why – but want to support the site? You can donate “beer money.” I appreciate it immensely. Click on the beer mug to find out how:
Would you like to be notified via email when WOLF STREET publishes a new article? Sign up here.