In his latest New York Times column David Brooks thinks he has discovered the golden thread that runs through the Biden Administration’s COVID-19 relief bill, its infrastructure plan, and its yet-to-be-released “family” plan:
This could be the Chinese century, with their dynamism and our decay. The unexpected combination of raw capitalism, authoritarianism and state direction of the economy could make China the dominant model around the globe. President Biden, Dunn said, believes that democracy needs to remind the world that it, too, can solve big problems. Democracy needs to stand up and show that we are still the future.
I asked Cecilia Rouse, the chair of Biden’s Council of Economic Advisers, where our vulnerabilities lie. It is in our public goods, she said, the degradation of our common life.
“The model of the past 40 years has been to rely on the private sector to carry the load, but that sector is not best suited to deliver certain public goods like work force training and infrastructure investment,” she told me. “These are places where there is market failure, which creates a role for government.”
Brian Deese, the director of Biden’s National Economic Council, said that Bidenomics has three key prongs: an effort to distribute money to those on the lower end of the income scale, an effort to use climate change as an opportunity to reinvent our energy and transportation systems, and an effort to replicate the daring of the moon shot by investing big-time in research and development.
Some people say this is like the New Deal. I’d say this is an updated, monster-size version of “the American System,” the 19th-century education and infrastructure investments inspired by Alexander Hamilton, championed by Henry Clay and then advanced by the early Republicans, like Abraham Lincoln. That was an unabashedly nationalist project, made by a youthful country, using an energetic government to secure two great goals: economic dynamism and national unity.
I don’t know that I have ever encountered a more drastic, untruthful reinterpretation of American history anywhere. Let’s start with the opening passage of the column:
What is the quintessential American act? It is the leap of faith.
I don’t know what the experience of Mr. Brooks’s immigrant ancestors was but I am pretty familiar with my own. “Act of faith” does not really characterize them. More like “couldn’t stay where they were and there was nowhere else for them to go”. I would wager that was the situation for Mr. Brooks’s ancestors as well. Whose ancestors does that describe? Certainly not those of Native Americans, the original Americans. They were just going to the next hunting ground in pursuit of game that they could see. No faith involved. It doesn’t describe the ancestors of most American blacks who were transported here against their wills in the holds of ships in chains. It doesn’t describe the ancestors of Virginians were were transported here as indentured servants to pay off debts or those of Georgians whose ancestors were transported here as prisoners, having been convicted of some crime.
It does describe my Wagner ancestors who bought tracts of land from land developers who came over to Germany and came to the U. S. in the 1820s without really knowing what they would find. They had both hope and faith but they didn’t rely on the government to do anything for them other than, perhaps, to leave them alone more than had been the case in their native Rhineland-Palatinate. But they were a distinct minority even among my ancestors who were mostly fleeing debts.
Onwards. Mr. Brooks does not, apparently, see the irony of admiring the Chinese for “raw capitalism, authoritarianism and state direction of the economy” without noting that until 1979 they had both authoritarianism and state direction of the economy and remained the country with the largest number of drastically poor people in the world.
“Public good”, as I’ve noted before, has a definition. It means a good (or service) that is non-rivalrous and non-excludable. Neither work force education nor most infrastructure fit that definition. If you don’t believe just google healthcare job certification, IT job certification, auto mechanic certification, or any of a dozen others. You will find a dizzying array of different possibilities. Clearly, there is no market failure there. Being most generous, perhaps they’re conflating market failure with a lack of willingness to pay. Those aren’t the same things.
When someone throws around terms that actually have established meanings like that one of two things is most likely. Either they’re ignorant or lying. Again, being generous I’ll go with ignorant. I think the syllogism goes something like “economists are smart people; economists use those terms; if I use those terms I’ll be a smart person”. That’s a major problem today but it’s not a new one. The Smothers Brothers lampooned it more than 50 years ago:
I see by your outfit that your are a cowboy
I see by your outfit that you’re a cowboy, too
We see by our outfits that we are both cowboys
If you get an outfit you can be a cowbody, too.
So far I have seen nothing in an of the Biden Adminstration’s plans to “distribute money to those on the lower end of the income scale”. What I have seen is plans to pay NGOs and individuals to provide services for those people and to boost the ranks of union membership. I have also seen plans to pay companies among the ranks of approved bidders to build and repair roads, bridges, etc. Not much actual redistribution there, either, except from one group of well-heeled individuals to a different group of well-heeled individuals.
Now turning to Alexander Hamilton, I presume what he’s referring to is Mr. Hamilton’s “Report on Manufacturing”. The other components of the Hamilton Plan all had to do with public debt and are not really relevant to Bidenomics.
The “Report on Manufacturing” championed tariffs and subsidies to industry, mostly in the forms of roads and canals. I’m not sure what the 21st century equivalent would be but it certainly wouldn’t be subsidizing personal transportation. Interstate traffic is overwhelmingly personal transportation; less than a quarter is truck traffic. My view, as I have tried to make clear, is that building new roads and bridges is subsidizing the personal transportation of the 20th century and repairing existing roads and bridges is not much better. It will be interesting to see how the Biden Administration differentiates itself from the Trump Administration while adopting its views on tariffs and other issues.
In conclusion I honestly don’t know what the “quintessential American act” in 2021 would be or even if there is such a thing. 20 or 30 years ago I would have said that setting out to make it on your own and to persevere despite obstacles was the quintessential American act. None of my immigrant ancestors expected anything they didn’t pay for. Neither did my parents who were not only the first individuals in each of their families to get post-graduate degrees, they were the first to graduate from college, high school, or even from grade school. Neither did my parents or great-grandparents. Neither did Huck Finn or Tom Joad, in their own ways quintessentially American characters. I think that was a different America.