An essential post from Bartlett on the trivial differences between Europe and the United States. Speaking as someone who managed to survive growing up on that benighted continent, it’s high time we move beyond gratuitously bashing our closest political and cultural cousins. I’m not in favor of replicating the European social model here in the United States, but appropriating its best features sounds like a pretty good idea.
Will
Will writes from Washington, D.C. (well, Arlington, Virginia). You can reach him at willblogcorrespondence at gmail dot com.
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What are the best features you recommend that we replicate? Then we will have something to discuss.Report
Cheese sauces, for one.Report
We could start here, Mike:
http://www.ordinary-gentlemen.com/2009/10/how-do-those-northern-europeans-do-it/Report
One of his points is that increases in the income tax necessary to finance public committments would be ‘too debilitating’, and that therefore it be necessary for us to enact a value added tax. Given that for a generation the country has run balance of payments deficits to the tune of 4% of domestic product, a consumption tax is arguably a necessary compromise. However, he is also arguing that the Danish economy is not debilitated by a ratio of taxation to domestic product three quarters again our own. Perhaps there is support in the literature of applied economics for this; it would seem… counter-intuitive.
There is no mention of what looks very much like a demographic death spiral in a number of European countries. Is it his contention that this owes nothing to modes of political economy?
He is intent on making plain that the European state did not, as predicted by v. Hayek in 1944, consume the whole of the European economy. What he neglects to enumerate are instances where the state has retreated from the superintendency of economic life. In the United States, public agencies created to absorb surplus labor (e.g. the Works Progress Administration) were dismantled during the war and wartime economic planning, rationing, and price controls were dismantled after the war ended; there were a slew of mercantile regulations dismantled during the period running from 1977 to the present (in transportation, finance, and broadcasting). Otherwise, nada. For a period of four decades, the federal executive was in the hands of either Republicans or of Democrats who had cut their teeth in state capitals. Visible progress toward devolution: nil. For the entire period from 1947 to the present, state direction of economic life has (in this country) proven a one way ratchet.
The federal government has enormous inventories of timber and grazing land, operates a postal service, superintends a stew of subsidies and production controls in agriculture, and collects hundreds of billions of dollars in payroll taxes from impecunious people and then spits some back in the form of subsidized food, subsidized housing, and subsidized gas and electric power. There are also the small ticket stupidities – government grants for goods and services that could be handled bloody well by philanthropies (e.g. the National Endowment for the Arts). I would be more impressed with Mr. Bartlett’s point if he had brought any of this up.Report
“There is no mention of what looks very much like a demographic death spiral in a number of European countries. Is it his contention that this owes nothing to modes of political economy” so more supportive social services leads to less screwing??? Yeah right. why don’t you just blame rainy northern european weather on the “political economy.” The general tendency if for higher standards of living leading to lower birth rates and most western euro countries have high standards of living, which is apparently bad according to you. the idea that those various countries are going to disappear or turn brown or whatever is claptrap.
Try as you might you never refute his point that, as he explains Hayek, Hayek was wrong. Some government does not lead inexorable to total state domination. Even your examples in the US don’t show that. You also don’t explain why, other then you think it is a good thing, we should be devolving various gov functions. maybe its good we haven’t done so.Report
Considering that, in practice, “devolving government functions” tends to mean “wastefully and monopolistically outsourcing to politically connected corporations” rather than actual elimination of funding for said functions, I tend to be suspicious of it myself.Report
I actually had in mind the replacement of federal grants-in-aid, categorical grants, and bloc grants with an unrestricted subsidy to state, county, and municipal governments. Programs currently operated by states or localities with grant money from superordinate authorities might continue to be so, but according to the discretion of those more particular authorities.
One might also transfer properties and public agencies to more particular authorities as well. The largest public park in the United States is the Adirondack State Park. It is difficult to see (pace Ken Burns) that our inventory of wilderness needs to be superintended by the federal government.Report
FWIW While Adaroncak SP is a great place it is not the largets public park int the country. Wrangel-St Elias NP in Al is bigger, Denali NP and Preserve is almost the same size.
But you don’t have an argument why the feds shouldn’t be involved. It was the feds creating all those parks, which most Americans treasure and enjoy.Report
Questions:
1. Are there demonstrable economies of scale in the operation of assemblages of public parks?
2. What other claims are there on the time and attention of bodies undertaking oversight?
3. Why would one consider control by the central authorities more congruent with self-government than operation by state or local authorities?
4. The federal government was once the formal proprietor of all land not within the borders of the thirteen original states, so it did sequester the land in question for the creation of the parks. The significance of that now is just what?
It is difficult to think of a more ‘local’ issue than land use.Report
If you bracket out some oil principalities and some microstates that function as tax havens (e.g. Monaco), the United States has the world’s highest per capita income. Norway is more affluent, but that is nearly it. The U.S. also has a fertility rate about at replacement level, which is atypical in Western Europe and not to be found in the affluent countries in the Far East either.
I am aware that fertility rates decline in response to the shift in the distribution of employment from agriculture to industry and services. My point concerned not the quantum of sexual activity in Denmark or in Philadelphia, but in how taxation, entry and exit from the labor market over the course of the life cycle, and the incentives embedded in public benefit programs influence people’s understanding of the costs and consequences of child bearing. What is happening in Western Europe suggests that the pattern of one generation caring for another over the course of the life cycle has been badly disrupted.
Refuting v. Hayek is not my job, nor my object. My object was to discuss problems which have manifested themselves in an American context. Quite a number of European countries have been able to sell off large inventories of state-owned industry; I am not sure they have been all that successful in reducing the quantum of redistribution or of goods and services purchased by the state.
I think centralization is useful in circumstances where a larger actuarial pool is desirable. As regards (say) primary schooling or public works (for the most part), it is hard to see that is true. You have decisions being transferred from local politicians who may better reflect the priorities and sensibilities of locals and transferred elsewhere. The filaments of public finance are means by which the discretion of state and local authorities is constrained and leave even attentive publics confused as to just who is responsible for which policy failures. One also does get the impression that the utility of federal funding is for local cadres to pursue courses of action at a variance with local sensibilities, with the excuse that the federal apparat has made a condition of it. In addition, the promiscuous use of federal grants and state grants allows the formation of patron-client relations between politicians and constituencies and good publicity for the politician at the upper level. A general subvention to particular units which has the affect of ameliorating the effects of intrametropolitan migration, regional economic decline, and regional underdevelopment would be in order. The thing is, there isn’t any candy in it for politicos who want stuff to put on their brochures, nor for the compulsive micromanagers in the U.S. Congress.Report
Will, I followed the links, but I’m still not sure which aspects of Denmark’s governance we should emulate. Civil liberties, such as? Nationalized healthcare? I’m not being difficult, but is there something specific?Report
Mike –
A deregulated labor market, robust support for free trade, and a reasonably expansive social safety net sounds pretty good to me.Report
Depends on what sort of behavior that safety net encourages and discourages.Report
I wouldn’t call these features of the European social model, except maybe the expansive safety net, which is what you proposed we adopt — but then we’ve had a reasonably expansive safety net since FDR.Report
I butchered my response — you advocated adopting the best features of the European social model, but the only thing you listed which would be a feature of the European social model is the expansive safety net, and we already have an expansive safety net.Report
Mike, I think you missed the most important part. The northern europeans have an extensive social safety net and rather high taxes. What they also have a a very very non-intrusive policy when it comes to private industry. In other words they’re very low on the regulation side of things. Now obviously it may not transfer to bigger less homogenious countries in America but the Nordic Europeans seem to have figured out a way to strap the golden goose into a harness to get a lot of good work out of it without killing it.Report
we already have an expansive safety net.
And it’s a Rube Goldberg contraption rife with perverse incentives and rent-seeking.Report
North, I got the point, but when you talk about features of the European social system, and then concentrate on a small country like Denmark, which couldn’t operate like it operates if it had pay for it’s own defense, or support a large, diverse society, or be a major contributor to IMF and the World Bank to support third world countries, , it seems a little like comparing apples to astronauts. Our country and our position in the world is so different from Denmark, that it’s a useles comparison. But taking Europe as a whole, and looking at its social system, I’d say that there are stark differences in the way we should operate — so the point is that Bartlett is being silly by finding a few areas to build up, while ignoring the main point — that we couldn’t survive under a Eurpean system, and Europe couldn’t survive if they had our responsibilities. Plus, the few areas we have emulated have become, like Art Deco writes, a disaster corporate welfare and incompetence which we can’t sustain. America is a unique country which needs to support capitalism if there is to be any long-term wealth creation and progress. We should be looking for innovative ways to create safety nets through voluntary means, not follow the European model, which will bankrupt us — and unless Europe takes responsibility for its own defense, if we collapse, they go to.Report
I don’t completely disagree with you. But if we were emulating the Danes then we wouldn’t be doing corporate welfare.Report