Can America Be Fixed?

One of our Arendt Center members sent me this latest article from Fareed Zakaria. The numbers can be dizzying, but the basic thesis is one that we at the Arendt Center have been worrying about: Overspending on entitlements and debt are bringing about a situation in which the essential public role of government is being crowded out by its social demands. As Zakaria writes,

The continued growth in entitlements is set to crowd out all other government spending, including on defense and the investments needed to help spur the next wave of economic growth. In 1960, entitlement programs amounted to well under one-third of the federal budget, with all the other functions of government taking up the remaining two-thirds. By 2010, things had flipped, with entitlement programs accounting for two-thirds of the budget and everything else crammed into one-third. On its current path, the U.S. federal government is turning into, in the journalist Ezra Klein's memorable image, an insurance company with an army. And even the army will have to shrink soon.

No doubt government has the role of helping its citizens in need. And our modern entitlement programs are an essential part of a just polity. But we now risk misunderstanding government for insurance. So much so that, according to the a report by Third Way, in 2029 the US will spend as much on social security, Medicare, Medicaid, and debt payments as it takes in from taxes. Everything else we want to spend money on as a country will have to come from either higher taxes or further debt.

The real problem here is not economic so much as political. It is easy to say that the US has always been partisan and that it is very American to disdain government.  Zakaria offers perspective, citing a 1975 report from the Trilateral Commission entitled The Crisis of Democracy, that predicted gloom in the United States and Europe. We should be aware of a human tendency to elevate our present difficulties into tragic flaws. And yet, simply because last time things worked out, we should not assume that they will this time as well.

What is different this time? While the United States remains a vibrant economy, its political system is increasingly broken. It is captured by special interests and addicted to debt. We spend $4 on our elderly population for every $1 we spend on our young. Schools are failing. We are cutting public pensions and obliterating private pensions outright with 401k savings programs that don’t provide people enough money to live on. Bridges are falling. Our roads, railways, and airports are in disrepair. And our political debate is consumed with taxes and spending. I know wise cynics say politics is politics, but the present idiocy does seem different. We should never assume that just because it worked out the last time, it will again. There are moments of new occurrences in politics. And it is possible that our current political crisis really does portend something new.

Image: Matt Collins

At least the public seems to think so:

Anger with politicians and institutions of government is much greater than it was in 1975. According to American National Election Studies polls, in 1964, 76 percent of Americans agreed with the statement "You can trust the government in Washington to do what is right just about always or most of the time." By the late 1970s, that number had dropped to the high 40s. In 2008, it was 30 percent. In January 2010, it had fallen to 19 percent.

Zakaria offers numbers upon numbers. I am sure some are more right than others. But the overall trend is undeniable. His essay is more than worth a read.

-RB