American Exceptionalism

In his most recent New York Times column David Brooks puts out as good a definition of American exceptionalism as any:

In an important 2001 paper, the economists Alberto Alesina, Edward Glaeser and Bruce Sacerdote detailed exactly how distinct America’s system has always been.

In 1870, they wrote, government in America spent only 0.3 percent of gross domestic product on social benefit programs while France spent 1.1 percent. By 1998, America’s spending on such welfare-state programs as poverty relief and benefits for retirement, disability, unemployment, health care and family care had risen to 11 percent of G.D.P., but France’s had risen to 21.6 percent. Several European countries were typically spending twice as much as America to help the old, the young, the sick and the disadvantaged. Today, America spends 19 percent of G.D.P. on social benefits while France is at 31 percent.

Why have we adopted such a distinct system? Well, we’re a country that came into being through a revolution against centralized power. We have a high suspicion of the state. We’re also an immigrant nation. We put enormous faith in the gospel that hard work leads to success. This has led to an ethos that invests lots of money in future growth and less in a safety net for those who fall behind.

Finally, we’re a diverse country. People support social spending for the poor when they see the poor as members of their racial or ethnic group. People are less likely to support social spending when they see the poor as predominantly members of some other group.

to which I would add that government in the United States is not merely trusted less than that of other countries; it is less worthy of trust. If you’re looking for evidence that’s the case just consider how many elected officials become wealthy in elected office, far wealthier than can be explained by their official salaries.

He then expresses his doubts about current trends:

Ten years ago, I would have been aghast at this leftward shift. But like everybody else, I’ve seen inequality widen, the social fabric decay, the racial wealth gap increase. Americans are rightly convinced that the country is broken and fear it is in decline. Like a lot of people, I’ve moved left on what I think of the role of government and income redistribution issues. We surely need to invest a lot more in infrastructure and children.

But I worry about this new economic philosophy that asserts you can have everything you want without trade-offs. This week I was reading a smart blog post from a progressive economist and I came across phrases that startled me: “Public debt doesn’t matter” and “Work incentives don’t matter.” Really? Have the laws of gravity been suspended, too?

These are not disconnected. For reasons I don’t quite understand progressives tend not to believe that there is such a thing as “human nature” or, at least, they believe that human nature is completely malleable. Furthermore, also incredible to me, they tend not to believe that people follow incentives. If you reject the possibility that history is any guide, you are ipso facto rejecting the lessons of history.

In my view the adverse developments to which he points are a consequence of factors that include the following:

• Financialization of the economy and its handmaiden
• Monetization of the debt
• Deindustrialization, i.e. Loss of productive capacity
• Mercantilism on the part of countries with which we compete
• Passing laws but not enforcing them
• The strategy of improving the lot of the poor by paying people to provide services for them
• Too many poor immigrants too fast

Contrary to what you might conclude from that last bullet item, I am not anti-immigrant. I just think that the U. S. is an outlier and should remain so but at 15% being immigrants, mostly from Mexico and Central America, we presently have an immigrant population that is more than we can assimilate. We’re changing: we’re becoming more like Guatemala.

Which of these factors does the Republican leadership want to change? None. Which of these factor does the Democratic leadership want to change? None.

That’s why that rather than “investing a lot more in infrastructure and children” we will inevitably end up paying a lot more to construction companies and teachers without improving our infrastructure or educational outcomes. It’s also why what will be billed as “ending the carnage” will do practically nothing to reduce gun homicides but will mostly result in more unenforced laws being broken.