A helpful government [u]

The title is judged an oxymoron by conservatives, who subscribe to the Reagan doctrine that government is the problem. Decades of anti-government rhetoric have taken their toll on public sentiment, which leads us to this facile deduction: If government cannot work, why give it money? So, down with taxes.

Back in the relative halcyon days of the 50s and 60s taxes were higher and governments were busy building highways and operating more than decent public school systems. The rich weren’t quite as rich and the poor not as poor. Inequality was at its lowest point.

Then along came California’s Proposition 13 and Reagan’s taking control of Sacramento. After largely destroying the state, Reagan enlarged his appetite in the White House and anti-tax initiatives proliferated throughout the country. A revolution was underway, this time from the right.

The other day I accompanied my wife to the local drivers’ license agency. In years past such a visit was tantamount to a date with the dentist: something to be dreaded and endured. The clerks were typically surly, impatient, and abrupt. Not any more. As soon as one enters the doors one sees posters on the walls promising excellent customer service. The clerks are now friendly, efficient, and helpful. My wife renewed her license quickly and pleasantly.

If the DMV can change, why not the rest of government? Why, in the end, can’t government be effective?

Well, we won’t get there by simply bashing government and squeezing it to death. Only a fool would believe that society can function without a system of governance. Yes, I know that there are plenty of such fools out there plying social media and Fox News. Heck, some even get themselves elected and re-elected to, yep, government.

But who will:

  • build and maintain transportation systems
  • build, maintain, and operate public schools
  • promote the general welfare?

Notice that I have bolded the third bullet. It comes from the Constitution’s Preamble. I emphasize it because it is often ignored or variably interpreted, depending on one’s ideology.

Suppose we focus on one issue that dominates the “general welfare” category. That would be inequality. One can dismiss or deny that it exists, but the facts say otherwise. Let’s take a look.

Gini index to 2014

Unless our eyes deceive, the curve has been moving steadily upward since the 1970s. We may also note that the trend appears to be bipartisan; it really doesn’t matter who is in the White House or controlling Congress. Indeed, the measure rose sharpest during Clinton’s first term in office, despite Democrats’ ostensible support for income distribution.

Inequality, we know, is bad for our health. It also threatens democracy. It would be difficult for someone to argue with a straight face that inequality promotes the general welfare.

So, which actors in our economy could make a difference in this trend. Who, or what, could force the curve downward?

I suggest we look around the world. Here’s a map from Wikipedia based on CIA data.

World_Income_Gini_Map_(2013).svg

The lowest Gini indexes (dark green) correspond with countries in northern Europe, mostly the Scandinavian nations. These countries have more or less embraced social democratic principles and their respective governments are proportionately larger than the U.S.’s. Moreover, these governments redistribute income to a far greater extent than ours does.

Sometime ago I wrote about “spreading the wealth around.” I included a chart similar to the one below.

Poverty rates selected countries before and after taxes and transfers

We see that the above countries dramatically reduce poverty through government efforts. Look at the Scandinavians.

Meanwhile in the U.S., the free-market crowd promotes not the general welfare but proper values. Let them eat thrift, I guess.

___________________

UPDATE (May 19, 2014):

Via Digby I came across this lengthy essay in the Washington Post about the Great Society 50 years later. It’s a fascinating read, telling us about the program’s many initiatives, their possible overreach, but also the conservative reaction. I found this interesting, and apropos of my post above:

The economy was booming, ginned up by a big tax cut. America was mourning a slain president who had ignited its idealism. The civil rights movement had awakened its conscience. The nation was led by a president of unmatched legislative skills. And confidence in Washington was as high as pollsters have ever seen it.

Back then, when Americans were asked how often they trusted the federal government to do what is right, nearly 80 percent said just about always or most of the time, according to data compiled by the Pew Research Center.

That confidence would begin to erode dramatically in the mid-1960s as Vietnam and social disruption surrounding the Great Society shook Americans’ faith in the government that had brought them through the Depression and World War II.

By the end of 1966, their favorable view of Washington had declined sharply, to 65 percent — and it had a lot farther to go. It stood at 19 percent after last year’s government shutdown.

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