Crossing the Rubicon:

The Major Push Toward American Statism

The historically famous crossing of the River Rubicon, just north of San Marino in Northern Italy, is not much remembered as the flashpoint where Caesar touched off civil war in 49 B.C. Instead, it is thought of by most people as a point in a course of action from which there is simply no return. We think it is time for America to recognize that such a pivotal point in our American democracy may well be at hand.

President Obama, Speaker Pelosi and Senate Majority Leader Reid apparently believe the time is ripe to deliver to the political left the full-blown statist society that has been the centerpiece of the far left’s agenda for a hundred years. And make no mistake about it, once we arrive at that degree of statist reliance on government, there will be no turning back. We will not be able to escape the trillions of dollars of debt and the many tens of trillions in unfunded liabilities that will be left to posterity and will hobble generations to come. We cannot escape that reality.

Statism is generally defined as reliance on a central government for all, or nearly all, social and economic planning, control and funding. It is the very antithesis of personal freedom and entrepreneurship on which our nation’s economic strength has been built. Extensive interference with individual decision making as well as individual property and contractual rights inexorably sublimates the role of the individual and the family to the role of government. Nothing could be more contrary to the America envisioned by the founding fathers. Such thinking has brought, and is bringing, ruin to many other nations, but never mind that. The simultaneous excesses within the financial industry and the vacant oversight by various federal agencies and, especially the Congress, which brought about the burst bubble of the last decade has given the political left its long awaited opportunity to take unprecedented steps to control vast swaths of the American economy. In the 2008 campaign Democratic candidates talked about sensible regulatory reforms to maximize fair competition. Once elected, however, governing philosophy as enunciated by Rahm Emanuel morphed into the phrase “never waste a crisis.” And they haven’t.

Certainly we have had occasional bouts of statism before. As government continued its relentless and compulsive 20th century expansion to advance this or that program that the left deemed essential to the well being of the people, statism took hold in certain segments of our national life. However, with the exception of some of FDR’s New Deal programs or LBJ’s creation of Medicare, statist encroachments have been narrowly directed (through lavishly funded) toward specific programmatic objectives such as President Johnson’s War on Poverty, or the assortment of President George W. Bush’s initiatives such as No Child Left Behind or Medicare Part D.

While we are no fans of hyperactive government, we acknowledge that to achieve the American objective of opportunity for all, on which a free enterprise system must be based, government has a role in preventing individuals, businesses and industries from gaming the system. However, we have now witnessed in the early months of the Obama Administration, the appointment of three dozen new so called czars, none of whom have been confirmed by the Senate, but who have been given unprecedented powers over vast swaths of the economy. Many of these appointees seem to have no particular expertise or experience with the mandates they have been assigned. Predictably, people throughout the country are beginning to react to the emergence of unchecked and rampant government controls or takeovers that seem to be mushrooming only nine months into this Administration’s tenure. It isn’t a pretty picture. And with the enormous projected costs, now running into the trillions of dollars, many Americans are becoming uneasy and seem to be asking, is this really what we bargained for?

Instead of simply sounding alarms which the political left will scoff at for fear it might impede their march toward socialism, we should examine the statist experiences of other countries. Obviously, the most extreme example is that of the Soviet Union and, for over 40 post-war years, its Eastern European satellites. The premise of so called true socialism was that the state would own the means of production, and everyone would equally share the bounty. In reality there was no such sharing because there was no bounty. Moreover state ownership of vast sectors of the economy often takes repressive regimes to enforce its control (think Cuba, Peron’s Argentina, Putin’s Russia, Chavez’s Venezuela, Iran, Burma, and most of the Arab world).

And of course there’s modern-day Europe and the statist European Union to which each member state surrenders more and more of its sovereignty with each passing year. This is the liberal statist’s model. Over and over again, we hear an assortment of universal healthcare proponents chide the American public that we are the only major industrial country that does not provide national or universal healthcare to its citizens. Never mind that 85% of Americans are covered by health insurance and the vast majority of these families are satisfied with their healthcare plans. We have Medicaid for poorer families and a requirement that every hospital emergency room provide care to anyone seeking it whether they can pay for it or not. Everyone concurs that there is room for substantial improvement in our healthcare delivery system, but to use the European statist model as the blueprint for healthcare in America will create an entitlement that we cannot ever hope to afford. What the left wants us eventually to emulate is, of course, the national healthcare programs first inaugurated by Great Britain and now widely in place throughout Europe and Canada. But when has Europe ever been the model we have chosen to follow?

True, in the European model, everyone has a place to go if they are in need of medical care and no one gets much of a bill, at least not from the clinic or hospital that eventually provides assistance. The bill, however, does come. It arrives everyday through the taxation required to keep these economies afloat. The aura of free medical service creates a significant increase in the demand for medical service without a commensurate increase in supply and, as a result, waiting time for service extends far beyond what we would consider acceptable in America. According to a recent study by the Fraser Institute, as reported on CBS News, wait time in Canada is 18.3 weeks for surgical or therapeutic treatment. Wait time is even longer throughout much of the EU. The quality of care doesn’t stack up well either, at least not for major illness. According to the National Center for Policy Analysis, breast cancer mortality is 52% higher in Germany than in the United States and 88% higher in the UK than in America. Prostate cancer mortality is 604% higher in the UK and 457% higher in Norway than it is here. And 70% of German, Canadian, Australian, New Zealand and British adults say their health system “needs fundamental change or complete rebuilding.”

The problems with statist controlled societies aren’t limited to healthcare issues. Sooner or later, trade, manufacturing standards, how many hours a man or woman can choose to work, vacation time, sick time, compensatory time, termination rules, hiring rules and every other aspect of commerce and daily life can, and sooner or later will, become the focus of statist scrutiny and control.

Camouflaging state control with soothing sounding programs doesn’t make it any better. To paraphrase a song from the Broadway musical “Mary Poppins,” “a spoonful of sugar” doesn’t make the medicine go down. And yet without any real understanding by the American people that this kind of overreaching would occur, the state is now exercising ownership and control over the banking system, the auto industry and, very possibly, it is about to have enormous control over the healthcare system, and the energy industry (through a preposterous cap and tax system). And the Federal Communications Commission is preparing to encroach into the internet through the cleverly named net-neutrality regulations. Other intrusions are hidden in the nooks and crannies of the ever-expanding regulatory morass. Even light bulbs and toilet paper haven’t escaped the government’s regulatory watch list.

When statist laws take effect, decline might be averted for a short time. But by destroying the free market place, the piper will soon enough be paid. Argentina’s economy collapsed more than once and Brazil also lost its credit standing in the world and created poverty rather than wealth when it flirted with statism. And we need look no further than Mexico to see how statist policies have stifled that country from widespread wealth creation and kept it from reaching the economic potential that its natural resources alone would permit.

The magic of America, since the nation’s inception, has been the internal gyroscopes of the people, free to gravitate toward each individual’s true north. That, to a great extent, is what American Exceptionalism is and has always been. And it is the Administration’s failure to understand this aspect of the American psyche that is perilous to all of us. In its quest to control healthcare, anything that can remotely be packaged as “protecting the environment” (or, with even more grandiosity, “saving the planet”), executive compensation and nearly every other aspect of our national life, we now have all-powerful bureaucracies answerable to no one but the President and his acolytes in the White House.

Faoud Ajami, Professor at the Paul H. Nitze School of Advanced International Studies at Johns Hopkins University, predicted in the Wall Street Journal, several months before the election that Barack Obama, if elected, would not merely change the direction of America, but the very fabric of America. Five days before the election, candidate Obama pretty much confirmed Ajami’s assessment when he proclaimed in a stump speech in Ohio, “we are five days away from fundamentally changing America.” Sadly, most Americans didn’t know what “changing America” meant. They were disgusted with the Bush Administration and simply voted to change parties without seriously drilling down on what candidate Obama meant by change. And that, in a nutshell, is why Congressional Democrats are likely to face trouble in next November’s elections. The people may like and admire President Obama but do not want him, the Congress or anyone else, to “fundamentally change America.”

We know two things for sure about statism; (i) It is a seductive but poor form of governance, invariably leading to stagnation, socialism, crushing costs and, ultimately, to economic decline; and (ii) it is the very antithesis of what our founding fathers envisioned as liberty and freedom for the new nation they brought forth.

The founders envisioned a limited role for the national government. They assigned to the federal government those powers that were necessary to secure an orderly and safe society. That is why they moved, very early on, to establish a standing army and navy, to take on the debt of the several states and to issue debt on behalf of the nation. They established a system of tariffs (largely to raise revenue), minted our own coinage and acquired enormous swaths of land consistent with the manifest destiny they believed we were morally obligated to pursue.

One thing, however, the founding fathers were careful to avoid and, in fact, went to great lengths to proscribe was interfering in the lives and the legitimate pursuits of the people. They, to a man, understood that the old model of governance whereby a sovereign would dispense rights to the people, distribute or redistribute wealth by government fiat and impose government directives or enforce papal bulls by which the people would be allowed to organize their lives, enjoy liberty or pursue happiness was not the principle for which they had fought.

Instead in a remarkably new experiment they created a form of government, previously unknown or untried, whereby the people were largely free to pursue their dreams without government direction or interference. Those early decisions unleashed a spirit of industriousness and productivity never before experienced in the history of mankind, and created widespread societal wealth at a level which was unprecedented.

We couldn’t say it better than Francis Cianfrocca did in the June, 2009 online edition of Commentary Magazine:

“The United States is organized on the principle of the consent of the governed. Power and legitimacy do not flow from the state to the people, but the other way around. In this respect, what individuals do is entirely their own business, just so long as they do not violate the law or the sovereignty of other citizens. Generating wealth is therefore no different from any other private human activity; it is and should remain private, outside the reach of government, until the point at which it impinges on others.”

Today, a new paradigm for America is being imposed upon us. New for America, but old, tattered and largely discarded where it has been imposed by repressive regimes elsewhere. Its basic premise is that everyone will produce and contribute to society to their full ability and will accept as the fruit of their labor only the earnings the government allows them to retain. It is, essentially, a redistributive philosophy of governance, whereby the government decides what you can keep of what you earn. Of course, one could argue, correctly, that a progressive income tax, which Americans have long accepted, does exactly that. But in America, when citizens acquiesce to such progressive forms of taxation they do so with the unwritten understanding that government will be responsible in limiting its appetite for funding, and will observe the powers reserved to the states and the people under the Constitution.

When government overreaches and establishes programs that require a modern form of tax farming that makes an art of taxing everything that national, state and local governments think they can get away with in order to impose state mandates to replace the free choice of its citizens, the people get restive and angry. And that state of mind leads them inevitably to use the one weapon that has always been available to them to curb government gluttony…the ballot box. Sadly, by that time, any damage done by this Congress will already be the law of the land.