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JFK2k4
I used to be a Republican, now I'm a Democrat, and of course, as everybody knows, I love explaining things in terms of basic principles. That's why back in April I wrote an essay trying to explain to my fellow liberals why conservatives think the way that they do. Now I'm ready to return the favor, but it's going to take two essays, because the two distinct threads of liberalism have less in common with each other than the various flavors of conservatism have in common with each other. But I will say this: from the way that conservatives talk, it is painfully obvious to me that they just plain do not understand liberalism at its most basic level. And as with all cases where people on opposite sides of an issue don't understand each other's motives, since they can't think of any honest reason why the other person would disagree with them, there can only be dishonest or otherwise evil reasons. Allow me to demonstrate that there's nothing evil, and everything sane and reasonable, about liberalism.

The first principle of economic liberalism is that there are certain services that, unless everybody gets them, everybody suffers. Let me give you a perfect example, because we actually tested this in history. We don't have to imagine what privatized fire protection looks like, because until about 90 years ago, nearly all fire fighters in America were privatized. If you bought home owner's insurance, it included with it a metal plaque you bolted to the front of your house. Then, if your house caught fire, you could call the fire protection company that was subcontracted to your insurance company, and they would come out to fight the fire. If a fire fighting company got out to your house and the plaque wasn't there, they'd turn around and go home. Which is what you deserve for not buying insurance, right? Well, even if you think that way, what about the houses on either side of you? If your house is allowed to burn to the ground just because you didn't buy insurance, what's going to stop that fire from spreading to their houses? Sure, they might have one or more fire protection companies on call, but won't they have a lot less damage to their house if, instead, your house isn't allowed to burn until the fire spreads?

  • If anybody doesn't get immunizations and related basic health care, then everybody has to risk living in a city where plague is spreading death and decay and the resulting vermin and rot.
  • If anybody doesn't get police protection, then everybody has to live in a city where the criminals have safe havens they can retreat to.
  • If anybody doesn't get a full education, then everybody has to live in a city where the permanently unemployable have nothing better to do than to burn the city down, and plenty of incentive to do so.
Granted, I chose the easy cases first, but not the easiest. Even conservatives understand that you can't privatize national defense, because when the army has to go overseas to protect America from some imminent threat, it's not as if they can "only" protect the people who paid for the army.

The second principle of economic liberalism is that it makes the most sense to pay for these things by taxing the people who can afford to pay. From the standpoint of pure fairness, you'd like to pay for these things with a flat tax. After all, if everybody receives the same benefit, everybody ought to pay the same price. Not that, in America, everybody receives the same benefit. It's not as if poor neighborhoods get the same quality of schools or policing that rich neighborhoods do. But let's keep things simple, and imagine a world in which everybody did get a fair share of the things that everybody has to have or else society will crumble. In such a world, everybody ought to pay the same price. After all, McDonald's doesn't "means-test" its hamburgers. If Bill Gates wants a Happy Meal, he pays the same price for it that I do, because we both eat the same snack and get the same toy. That's only fair, right?

But what if you took 100% of the income of the poorest people in America, set that as the baseline for taxation, and charged everybody that much? It wouldn't come to anywhere near enough to pay for even the minimum basic services. So somebody's going to have to pay more, or else we have to choose to let society crumble. And to some extent, in America, we have chosen to let society crumble rather than collect enough taxes to pay for these things, as even a casual drive past a rural or inner city school will show you; you can see the broken windows and sagging roofs from the street without even getting out of your car. But even with all of the social pressure to not charge rich people an "unfair" amount for services that everybody gets, we still do have to charge them more. As any conservative can readily tell you, the richest 25% of Americans pay 83% of the income taxes collected, and the poorest 50% pay only 4% of the income taxes collected. But the fact of the matter is that those poorest 50% can't afford to pay another dime.

The third principle of economic liberalism is that the middle class is "the economy."</b> Conservatives believe that if you cut taxes on the rich, they'll invest that money into companies, which will use that money to hire more people or pay more overtime, and therefore everybody benefits. For the last four years, we've been testing that theory. And indeed, rich people did invest that money in creating jobs ... elsewhere. They also invested that money in technology that could be used to replace workers. In short, giving money back to rich people resulted in them using that money to make it harder for ordinary Americans, the 80% or so of us who identify as middle class, from earning a living, let alone earning enough to invest anything in preparing our kids to better themselves, let alone enough to be able to pay enough taxes on to support the cities we all live in. And so after four years of tax cuts for the top 10% of all wage earners, we have the predictable result that cities are going bankrupt, and families are going bankrupt. And the other effect of this is that the companies themselves are going bankrupt ... because nobody can afford to buy their products.

Liberals understand that the biggest single problem with the economy, not just here in the USA but around the world, is insufficient demand. How many empty factories do we have? How many warehouses full of machine tools and processed raw materials do we have? How many workers do we have looking for jobs making things? How many people do we have who don't have enough things to live on? Why can't we move the huge inventories of processed raw materials and machine tools to the idled factories, hire the unemployed to work in those factories, and make the things that people need but don't have? The reason that we don't is that the people who need those things can't afford to buy them. And the reason that they can't afford to buy them is that wages are too low. Sweatshop workers in Burma and Indonesia and Malaysia don't buy a lot of American products, or for that matter, not a lot of Burmese or Indonesian or Malaysian products, either.

In summary, liberals don't support more public sector jobs and spending because public sector workers vote Democratic, but because they see things that every American must have access to or we all suffer along with them. Liberals don't support higher taxes on the wealthy because they feel entitled to steal from the rich, but because somebody has to pay for the things that we all benefit from (including the rich), and the rich are the only ones who can afford it. Liberals don't support higher wages and protection for American jobs because corporate officers and top shareholders vote Republican and unions vote Democratic, but because they understand that as long as Americans don't make good wages, the whole economy will be worse than it could be for rich and poor alike.

(Next: Lifestyle liberalism explained.)

Comments

[info]gothkat wrote:
Aug. 2nd, 2004 12:31 pm (UTC)
That's probably the best explanation of economic liberalism I have ever seen. I couldn't have said it better myself.
[info]harmfulguy wrote:
Aug. 2nd, 2004 12:37 pm (UTC)
Wow. These are some basic principles that I think I've started to understand over the last year or so, but haven't really been able to put together into a coherent picture, and certainly haven't been able to articulate well enough to explain to anyone else. Thanks a lot for your explanation.
[info]cargoweasel wrote:
Aug. 2nd, 2004 01:04 pm (UTC)
Right on, absolutely. Are there places where there is waste and inefficiency and government is throwing away tax money instead of using it on needed services? Yes. Where republicans and democrats differ the most is on the degree of this waste and the particulars of what should be cut vs. preserved. Republicans see something like public broadcasting or the NEA and think it should be cut, and Democrats tend to think there should be less military spending. It is a matter of deciding on priorities. Right now the priorities are way skewed in favor of military spending and kickbacks to corporate friends of the bush administration. republicans tend not to see those things as waste, where a nickel given to an arts group would make them scream bloody murder.
[info]xodiac wrote:
Aug. 2nd, 2004 04:20 pm (UTC)
well articulated
I've been thinking of the whole Liberal vs. Conservative thing a bit myself recently. What's interesting is that each side has some damn good points to make.

Both sides are after what they call, "fairness." So neither is a group of evil bastards out to rip people off. But they are after two different versions of "fair." To understand this, let me pose an analogy:

Take an elementary school class of, oh, 25. Let's pretend that school lunch is, oh, 3 bucks a day. (I have no idea how much it is, be let's use this number, okay?) That means for 15 bucks a kid can eat a decent mean each day.

15 of the kids receive an allowance from their parents of 20 bucks a week. So they can eat their meal, and have a little left over for pokemon cards or whatever. Or they can have a pretty nice meal.

5 of the kids get an allowance of 15 bucks a week. They can have their meal, but not really anything else. The'yre barely scraping by.

3 of the kids get only 10 bucks per week. They're really hurting.

And two of the kids get a whopping 45 bucks a week. They can have a really nice meal and still have enough for all the luxuries they want. They can buy pokemon cards or even save for a few weeks and buy a bike. The sky's the limit!

The Liberals says, "Hey, that's not fair! You're getting all this nice crap while these kids are getting bupkis. If you just give up $7.50 a week each they'll be able to survive well enough, and if you give up $15.00 a week they can even improve their lot! And you'll still have plenty for pokemon. This isn't fair. Whaddya say?"

The Conservatives say, "Hey, we earned this money, why should I have to give it up for people who haven't the smarts, talent, or luck to get it for themselves? That's not fair! This is mine and I'm going to keep it."

The situation is complicated, of course, by the fact that we are not kids in elementary school with an allowance; most of us did some kind of task in order to receive the money we have. (Though whether the task is equivalent to the money earned is sometimes up for debate - witness actors and sports stars. But it can't be denied they did do work.)

At any rate... while I agree with you, it is certainly a complex issue with many factors involved. I do think the rich should pay more. I don't think they should be taxed out of existence down to the poverty level, but there's a big scale between "more" and "all."

One question, by the by: where did you get your figures and facts? Because I know some people who need to see this post, but without a source for the figures you made your arguement out of, it can easily be dismissed.
[info]bradhicks wrote:
Aug. 7th, 2004 08:05 am (UTC)
Re: well articulated
Forgot to reply until now: the only actual numbers in the piece are from the Heritage Foundation's web site (there's a link to them in the article), so I don't suspect your conservative friends will be able to argue with them. The flat taxer's always publicize such figures because they think that they're unfair. And to some extent, they're right, as I admitted above. Taxation isn't about fairness. It's about finding a way to pay for essential services. And a "fair" tax just could not possibly raise enough money, so that means "unfairly" taxing the people who have enough money to cover the difference.
[info]cos wrote:
Sep. 16th, 2004 05:46 pm (UTC)
Re: well articulated
Contrary to what [info]bradhicks said, I think it is fair for the rich to pay higher taxes (and I say this as someone who has been in an upper tax bracket in the past), and I think a lot of liberals do. I posted my explanation in a comment below.
[info]cos wrote:
Sep. 16th, 2004 04:48 pm (UTC)
capitalism
I'll add one more element, or rather, flesh out something you implied or hinted at that I think needs to be more direct. See, I'm a Democrat (former Green), and I'm also a Capitalist, in the most direct way - I co-founded a company with two friends, and it grew to 30 people before it got merged into another company and I got a nice chunk of cash for my stock. I assert that the right wing of today simply does not understand Capitalism, and Democrats do.

Rich people don't invest simply because they have money - they invest when they think it's their best opportunity to turn what they have into more money. Similarly, companies don't invest or hire simply because they can afford to. They do so when they feel they need to, in order to meet demand for their goods or services. If they don't think that demand is coming, they won't spend their extra money hiring or making capital investments, they'll sit on it or pay it out in dividends.

So giving back more money to rich people, or to corporations, doesn't spur the economy much. What makes the economy work isn't rich people and corporations having more money (through a tax cut, for example) - it's when they believe they need to work for that extra money. When companies think that more demand is coming, and so in order to make money they need to hire and to build. When rich people think growth is coming, so they'll put their money into those companies.

And the engine that drives all that, of course, is consumer spending. Give back money to the people who aren't already rich enough to buy what they want - these are the people who have been holding back on buying what they want or what they need, because they don't have enough money. Give them money, and they'll spend it.

So, to build the economy, spread money amongst the poor, and let the rich compete to earn a share of that money. That is what we call a market, and that's what Capitalism is based on.
[info]cos wrote:
Sep. 16th, 2004 04:55 pm (UTC)
progressive taxation
Another important point is this: The rich actually deserve to pay higher taxes. It's not just that they're the ones who can afford it - it's that they're the ones who owe it, morally. Why? Because they're the ones who got the most benefit from the current system, they're the ones who ought to be supporting it.

I particularly like to give out copies of this column by Warren Buffett, writing about Bush's dividend tax cut plan. As one of the richest people in the world, he can't exactly be accused of petty jealousy against the rich. And my favorite part of his column is this:
    She's [my secretary] not complaining: Both of us know we were lucky to be born in America. But I was luckier in that I came wired at birth with a talent for capital allocation -- a valuable ability to have had in this country during the past half-century. Credit America for most of this value, not me. If the receptionist and I had both been born in, say, Bangladesh, the story would have been far different. There, the market value of our respective talents would not have varied greatly.
And that's exactly it: What he's saying is that he's not richer than his secretary because he's a more worthy person, or because he worked harder. It's because the system he and his secretary live under rewards his talent far more than it rewards hers. Without that system, he wouldn't have any more money than she does. And although he doesn't say it directly, I think he'd agree with me that the corrollary to this is that it is right and just that he pay more than she to support the maintenance and smooth functioning of this system.
[info]bradhicks wrote:
Sep. 20th, 2004 12:42 am (UTC)
Re: progressive taxation
I'm aware of that argument, and it appeals to me, but I don't use it when I'm talking to conservatives because it carries no weight with them. As far as they can tell, the system actually gives them fewer advantages than it does a poor person. That's such a huge gap in perception that if I let the argument go in that direction, it gets bogged down in useless minutiae.
[info]cos wrote:
Sep. 20th, 2004 11:46 am (UTC)
Re: progressive taxation
This isn't an argument, is it? I thought the goal here was to present the way we perceive things differently, and this is a very important part of it to me.

As far as they can tell, the system actually gives them fewer advantages than it does a poor person.

That's just it, that's the reason why this has to be part of the summary of how we see the world differently. If you don't say it, it won't occur to them to even think of it. It's something we need to be repeating, so at least they're aware of the idea. Over time it may take hold with some people who previously hadn't thought of it, too. And it can be defended rationally, when it comes to actual debate.
[info]bradhicks wrote:
Sep. 21st, 2004 10:36 pm (UTC)
Re: progressive taxation
Let me know how that works for you, OK? Because I gave up on it a long time ago. There's no point in even arguing this particular set of facts with someone who believes, as many do, that there are no advantages available to rich people in this society that aren't also offered to sufficiently highly motivated poor people, as Ted Rall nicely lampooned just last Friday.

Somebody I was reading a couple of months ago, I think it was [info]es, wrote an interesting essay about how much of social policy goes wrong because we base it on exceptional cases: we hold everybody to standards of success that can only be met by exceptionally strong individuals; we protect people from hazards that only affect the exceptionally stupid.
[info]cos wrote:
Jan. 17th, 2006 01:21 am (UTC)
Re: progressive taxation
There are people for whom nothing "workes", there are those who will think over something after they've heard it from many sources or over a long time, there are some who are re-evaluating or open to it at the moment and can be swayed by a good argument, there are plenty who just haven't thought about it and if you give them a new nugget they'll be surprised and it'll trigger something.

Overall, I find this "argument" to be one of the most powerful and most effective. It's one that a lot of people just don't seem to see until you point it out, because they don't really think critically about what Government spends on and what value people get from it in general sense, they think locally, about specific issues that have been in the news or up for a vote.

So yes, as well as anything else "works", this works with the best of them.
(Anonymous) wrote:
Jan. 16th, 2006 07:53 am (UTC)
Re: progressive taxation
What about the idea that the rich actually use the system more than poor people, so should pay more? I have heard that most of the time the courts spend is on business law -- rich people. Most of the wear and tear on our highway system is from trucking -- business using it more than private people. and so on.
If they get more use out of it, why shouldn't they pay for more of it?
(Anonymous) wrote:
Sep. 16th, 2004 11:01 pm (UTC)
One comment
Great post.

The only item I found needed clarification was the following:

"Even conservatives understand that you can't privatize national defense, because when the army has to go overseas to protect America from some imminent threat, it's not as if they can "only" protect the people who paid for the army."

Unfortunately, national defense has been extremely privatized at this point, with an estimated ratio of contractors to military of 1 in 10 - approximately 10 times that of the first Gulf War. (http://www.brookings.edu/views/articles/fellows/singer20040415.htm)

-yev (hi cos)
[info]bradhicks wrote:
Sep. 20th, 2004 12:43 am (UTC)
Re: One comment
Well, yes, but what I mean is that you can't privatize it in the sense of making it something that only the people who feel like buying military protection pay for it. Even today's All-Volunteer(ish) Army knows that it can't get by depending on All-Volunteer Taxpayers.
[info]perich wrote:
Sep. 30th, 2004 10:06 am (UTC)
Wow
I've never seen the arguments more clearly stated. Granted, I think they're wrong in every particular (I'm not a liberal), but that's the most accurate summation of the core tenets ("wow," I was saying to myself, "it really does all boil down to that") and the clearest presentation thereof I've read in ... a while, if not ever.

So, you get my Seal of Approval, for what that's worth.
[info]nikkif wrote:
Jun. 25th, 2007 05:13 am (UTC)
Since you just linked to this post, and I hadn't read it before, I hope you don't mind a very late comment.

The sliding income tax scale is more fair than conservatives seem to believe, and not just for the reason you mentioned (that it is the only way to pay for the essential services).

If everyone paid the same percentage of their earned income in taxes, say 10%, that ends up being regressive. For a person at the low to middle part of the economic scale, their earned income from a job is close to 100% of their revenue stream. So 10% of it is 10% of everything they have, essentially. But folks on the upper end of the scale make money from lots of other sources. They inherited it, they are earning returns on investments of one sort or another, etc. For them, earned income is often a pretty small percentage of what they are worth. So 10% of their income, while it is a lot higher than 10% of my income, is still a smaller percentage of their total income stream than it is of mine.

So the sliding tax scale is not only necessary, it is fair.