As we come to the end of the century, the American people are thinking about the condition of their government with extraordinary ambivalence. The political scientist who said that the American people are ideologically conservative but operationally liberal may have been right: The American people complain about big government, but they are quite content to live with it. Client groups in the country are now so strong that they can guarantee that the government will not do very much less than it is now doing. The tax phobia in the country is so strong that it guarantees that the government will not do very much more. So we stand at a stalemate.
This is not altogether bad news.
For a number of years now the center of political gravity has been moving steadily to the right. Indeed, with regard to balancing the budget and cutting back discretionary spending, Bill Clinton ran a more conservative campaign in 1996 than George Bush ran in 1992. And between now and the year 2000 Bill Clinton is promising to govern more conservatively than Ronald Reagan governed. In 1992 there were fifty-six Democratic senators. Today there are forty-five. Immediately after the 1992 elections there were 259 Democratic members of the House. Today there are 208. Immediately after the 1992 elections there were thirty Democratic governors. Today there are only seventeen--governing only 25 percent of the American people. These figures attest to liberalism in retreat, not on the march.
All sides in the political debate--liberals, conservatives, and moderates alike--now agree that the overwhelming problem of American public life is how to achieve economic growth. This represents a testament to the conservative ascendancy. It is yet a further testament that we have in substantial measure learned how to achieve precisely the growth we seek. Consider what we have learned about managing the business cycle.
Between 1890 and 1945 the business cycle was convulsive and destructive. Three times the economy contracted 5 percent. Twice it contracted 10 percent. Twice it contracted almost 15 percent. Yet since the Second World War there has been a single contraction, of a mere 3 percent, and today we find ourselves in a fifteen-year expansion that has been marred by only one mild recession. We have, in short, learned a thing or two--we have learned that our management of the economy should be marked less by fiscal and monetary fine-tuning than by broad respect for deregulated markets.
Yet are there problems on the horizon? There are indeed.
Paradox of the Welfare State
One is particularly painful for the nation's remaining liberals. It is a paradox. The great achievement of twentieth-century liberalism is the creation of the welfare state. Yet the welfare state today makes liberal government--by which I mean energetic, big-spending, redistributionist government--impossible. How can this be? It is so because the welfare state has swallowed the federal budget, leaving no room for new initiatives of any significance, and the welfare state will lay increasingly voracious claim to the budget as the population continues to age. For a welfare state, demography is destiny. The great demographic fact about our nation is that the elderly have become the disproportionate consumers of welfare state transfer payments. Fifty-two percent of the budget now goes to entitlement programs and another 14 percent to paying interest on the national debt. That leaves a grand total of one-third of the budget for all discretionary domestic spending plus all defense spending. Nothing is more certain than that that one-third will shrink to even less.
There is one way and one way only out of this paradox: economic growth at a more rapid rate than we have been taught is sustainable. The pivotal economic question of our era is thus whether 2.5 percent growth is the best we can hope to achieve or whether we can do better. A subsidiary but vital question is this: How far-reaching will the effects of Moore's Law prove? I refer to the then-outlandish 1965 prophecy, by Gordon Moore of Intel, that every eighteen months the computing power of the silicon chip would double. Moore's Law predicts, in short, that between 1965 and the present, computing power should have increased two million times. Astoundingly, it has. Does this in turn mean that the American economy, now aided by computing power at every level of production, can now achieve a permanently higher rate of growth than was previously possible? On that question hangs much of our politics.
The Deeper Problem
We come now to a second and deeper problem. I said a moment ago that all sides agree that the overwhelming problem of American public life is how to achieve economic growth. Yet this consensus has crystallized just in time for us to experience the discomfitting realization that it may no longer be relevant. Let me explain.
|Can we achieve a higher rate of growth than was previously thought possible? On that questions hangs much of our politics.|
Twenty years ago, everyone knew, as a cardinal tenet of the conventional wisdom, that economic conditions in America determined social conditions in America. When the economy improved, the culture improved. No one remains confident of that any longer. Two decades ago two lines on a graph crossed ominously. One line showed declining unemployment. The other showed rising welfare dependency. John Kennedy once said, "A rising tide lifts all boats." We are sadder and much wiser now. We know that many boats remain stuck at the bottom. In short, we have seen vividly demonstrated the central tenet of conservatism, which is that culture more than politics determines the success of a society.
Today the American urban crisis is producing a civilization of a kind that has never existed anywhere and that should not exist here. I mean a civilization in which the cities are important, not as centers of cultural and commercial vitality but only as burdens. Indeed we are witnessing a phenomenon virtually without precedent in urban history: broad-scale social regression in the midst of rising prosperity. The principal correlate is family disintegration. The principal consequence is the intergenerational transmission of poverty. The principal sound effect is gunfire. It is already the case in several states that more people die of gunshot wounds than of vehicular accidents.
We know what is causing this, but we do not know what is causing the cause.
|John Kennedy once said, "A rising tide lifts all boats." We are sadder and much wiser now.|
The cause itself can be described by three numbers: 26, 69, and 33. In 1965, young Patrick Moynihan, then in the Department of Labor, published a report called "The Condition of the Negro Family." He argued that there was then a crisis in the Negro family because 26 percent of all children born to African American women were born out of wedlock. That figure today is 69 percent. The figure for white America is 26 percent and rising quickly. And the figure for America as a whole is 33 percent, certain to rise to 40 percent within the next decade.
When Patrick Moynihan published his report, he wrote an article in which he argued that the lesson of history is clear. From the wild Irish slums of the nineteenth century to South Central Los Angeles today, when you have a large cohort of unparented males, you have chaos. Today we have chaos indeed--in large parts of our inner cities life is a slow-motion riot.
The cause is, as I say, family disintegration. But the cause of the cause? That we do not know.
I grant that many of my conservative friends believe they do know. They assert that the cause of family disintegration lies in the perverse incentives embedded in the welfare system. They argue--and it is not a trivial point--that when you subsidize something you get more of it and that we have now spent a number of decades subsidizing bad behavior. In other words, when we erect a welfare system whose message to young women is "Get pregnant, remain unmarried, leave home, drop out of school, and we will reward you with an array of benefits," then we are asking for trouble. And when you ask for trouble, you get it.
|From the wild Irish slums of the nineteenth century to South Central Los Angeles today, when you have a large cohort of unparented males, you have chaos.|
The problem with this argument is the power it grants to marginal economic incentives. Conservatives argue in effect that marginal changes in welfare benefits--benefits that have never been lavish and that have for twenty years been devalued by inflation--have had the power to alter a centuries-old social stigma against the fundamentally reckless act of having children out of wedlock. This tends in the direction of the old liberal assumption that you can engineer society by tinkering at the margins with economic incentives. This is the failing of which I sometimes think Jack Kemp is guilty when he says that the cure for urban blight is enterprise zones. The theory seems to be that if you lower taxes in a section of the blasted lunar landscape of South Chicago, then all the young men riding in BMWs with Uzi machine guns under their seats making $40,000 a week dealing crack cocaine will suddenly open dry cleaning stores. I suspect it's more complicated than that.
The New Paradigm
What does cause family disintegration? We do not know. What we do know is that the paradigm that has governed social policy for some sixty years is now inadequate. From the 1930s to the 1970s, social policies were shaped by men and women who were themselves shaped by the searing experience of material deprivation during the Great Depression. The paradigm that informed these policies was that poor people need material goods and services that the government knows how to deliver. The new paradigm that is being entertained in Washington--and that is driving a remarkably searching policy debate--holds that the old paradigm is exactly wrong. The new paradigm asserts that the impediment to growth and development for a large portion of the American population is not material scarcity but deeply rooted behaviors. It argues that the poor do not lack material resources but inner resources.
If the government has contributed to the dissolution of social capital, it remains unclear that the government knows much about how to replace it. Indeed, look for episodes in modern history that provide examples of similarly demoralized urban populations, and you will come, I think, to London at the turn of the nineteenth century. What occurred to ameliorate the social ills of that time and place was not acts of Parliament. It was John Wesley leading a cultural and religious revival.
Can we somehow generate such a revival of our own? We do not know. We know only that just when we appear in many ways to have solved the economic problem as traditionally understood, we come to learn that the economic problem is no longer the problem.
The Last Six Inches
It reminds me, as everything does, of baseball.
When Warren Spahn, then of the Boston Braves, was pitching in the Polo Grounds against the New York Giants in 1951, the Giants sent to the plate a rookie whose record to that point was a dismal zero for thirteen. His name was Willie Mays. Spahn wound up on the mound, sixty feet and six inches from home plate, and released the ball. Mays crushed it--left field, upper deck, a home run. After the game, sports writers asked Spahn what had gone wrong. Spahn replied, "Gentlemen, for the first sixty feet that was a hell of a pitch."
Just as sixty feet is inadequate when a pitch must travel sixty feet and six inches to reach the batter, so it is inadequate for us to solve the economic problem when cultural problems of such gravity remain. Indeed, in democracy, which rests on the shifting sands of public opinion, there is no such thing as a final victory. Which is why institutions such as the Hoover Institution are never done with their work, no matter how many victories you achieve.