Roads Taken and Untaken: A Meditation

The chart below from our friends at the Heritage Foundation is the kind of visual display of quantitative information (bow here to Edward Tufte) that sets the hearts of wonks fluttering, and the very kind of chart I do fairly often, too.  It displays the story of the relentless growth and avariciousness of the Federal government, showing that while median household income, adjusted for inflation, has grown only 24 percent since 1970, federal inflation-adjusted spending grew 287 percent.  In other words, federal spending has grown over ten times as much as median household income.

However, while the underlying point of this chart is correct, I wonder if it isn’t misleading in a couple of respects, or in need of additional layers of analysis.  What it leaves out is population growth, and more specifically household growth, since one half of the metric here is household income.  If the government extracts 20 percent of each person’s or each household’s income (which is about the historical tax take of total income), and the number of households grow along with income, you would expect total federal spending to grow faster than mere median household income because of that population growth.  So, between 1970 and 2010, while total population grew 52 percent, the shrinking size of the average American household means that the total number of households grew 75 percent, and total household income grew by 118 percent.  If the federal government merely taxed the higher level of income of the higher number of households at exactly the same tax rate, federal revenues would have also grown about 118 percent, and as such the 287 percent increase in government spending looks less dramatic than when compared only to the 24 percent growth in median household income.

So, to revise the original chart, it is more nuanced to say that federal spending has grown about two-and-a-half times faster relative to total household income—not ten times faster.  This is still bad enough, and it reflects not only higher taxes but the massive borrowing that has enabled the government to grow even when the economy and household incomes are not.  But the difference between a delta of two-and-a-half times and ten times is the gap within which a lot of confusing and inconclusive arguments take place.

In other words, while this kind of detailed analysis is important, it is still to argue on the home field of Krugman & Reich.  I suspect I’ve already lost a good portion of the readers of this post with the blizzard of numerology here.  But in the modern world, social science of this kind is said to be the pre-eminent if not the sole legitimate method of finding the truth or making distinctions between better and worse.  Yet as we know the numbers can always be sliced and diced in various ways, often deceptive, incomplete, or lacking context, that make it hard for workaday citizens to form a settled view of our public affairs.  This doesn’t mean we should eschew rigorous social science and quantitative analysis.  It might mean we should subordinate it to an older method of political and social argument—the kind of argument that is found, for example, in the extraordinary passage about moral reasoning that Alexander Hamilton struck off in the first three paragraphs of an otherwise ordinary essay about taxation in Federalist 31.

Or, to take a more current example on a higher level, consider a passage from Roger Scruton’s terrific 2007 book Culture Counts.  Scruton, a major figure in Anglo-American philosophy and my sometimes visiting colleague at AEI, departs in important ways from other British writers.  A lot of British conservatives, while friendly toward America, do not always understand America very well.  Roger gets it.  (So does Paul Johnson.  Memo to self: start a new Power Line feature with regular excerpts from Scruton to go along with the other past series on Hayek and Churchill.)  So in Culture Counts, Roger says this:

It is because of America, its successes, its conflicts, and its symbolic importance in the world, that the question raised by Spengler [about the decline of the West] is still with us: the question of Western identity.  Take away America, its freedom, its optimism, its institutions, its Judeo-Christian beliefs, and its educational tradition, and little would remain of the West, besides the geriatric routines of a now toothless Europe.  Add America to the discussion, and all the dire prophecies and mournful valedictions of the twentieth century seem faintly ridiculous.  Yet, precisely because the West now depends upon America, a country launched on a path that recognizes no place and no time as its own, Western identity has become an urgent matter of debate. . .

This project can endure, it seems to me, only if it can win a place in our emotions.

And that’s the point of my boss, Arthur Brooks, in his new book out today: The Road to Freedom.  You’ve heard of “recovering lawyers.”  Arthur is a recovering social scientist.  He can multiple-regress with the best of them, spreads calculus on toast, is more numerate than Fibonacci, George Boole, and Carl Gauss combined, and, on the side, can bench press The Collected Works of Adam Smith.  With one arm.  He’s the Dos Equis man of the think tank world: When Hegel tried to conceive pure thought, he had nightmares of Arthur Brooks.

The Road to Freedom obviously invokes a symmetry—hopefully not Blake’s “fearful symmetry”—with Hayek’s Road to Serfdom, which even a casual reader knows was not really about economics at all.  Arthur is blunt and direct: “Materialistic arguments for free enterprise have been tried again and again. They have failed to stem the tide of big government.  There’s only one kind of argument that will shake people awake: a moral one.  Free enterprise advocates need to build the moral case to remind Americans why the future of the nation is worth more to each of us than a few short-term government benefits.”  One might almost say this is an appeal to virtue—a principle of the Founders that has been airbrushed out of most accounts of the Founding.

Memo to the Romney campaign: please read this book.  I wince every time I hear Romney answer a reporter that the difference between him and Obama is that he (Romney) has private sector experience.  Really?  That’s what you’re going to go with as your leading contrast?  Please do us a favor and save all the campaign money and spend it instead on a good concession speech for November, because private sector experience not going to cut it, either for winning an election, or governing the country if he does somehow contrive to win.

Some months ago in this space I compared the gaps of Romney’s politics with something Whittaker Chambers wrote to William F. Buckley about his last encounter with Richard Nixon shortly before the 1960 campaign that I thought applied to Romney today.  I think it bears repeating:

If he were a great, vital man, bursting with energy, ideas (however malapropos), sweeping grasp of the crisis, and (even) intolerant convictions, I think I should have felt: Yes, he must have it, he must enact his fate, and ours.  I did not have this feeling. . .  So I came away with unhappiness for him, for all.  Of course, no such man as I have suggested now exists?  Apparently not.  Mr. Nixon may do wonders; he may astonish us (and himself), a new stupor mundi.  Then I shall have proved the man who, privileged to see the future up close, was purblind.  I hope so. . .  In short: I believe he is the best there is; I am not sure that is enough, the odds being so great.

The odds today are more difficult still.  The point is, we don’t need leaders who will merely resurface the road to serfdom, or even smooth out its potholes, or privatize the road with a technocratic approach.  We need leaders who recognize that a road is not merely a highway to a destination.