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One warm (or maybe hot) Spring day in 1968, I was in a little public park in a small California town, hanging around with a shifting group of 50 folks or so. We were awaiting the arrival of Eugene J. McCarthy, liberal Democratic Senator from Minnesota who in November the year before had announced his intention to run against President Lyndon Johnson in the New Hampshire primary. He was about an hour late, but no one seemed to mind waiting. I myself had waited two hours in the fall of 1960 for John Galbraith to get to our college town campaigning for John Kennedy. In both cases, there was a sense of excited anticipation but not frustration or annoyance.
Then a car drove up, and three folks got out. Applause and a few cheers greeted them, and McCarthy as well as a small Hispanic man shook hands joyfully as they moved toward the center of the crowd in this little park. The third guy, evidently a staffer, settled us down and apologized for being late. There had apparently been a big, enthusiastic crowd for them in Berkeley.
As Gene looked on benevolently, the staffer gave an impassioned introduction to the dark-skinned little man, who was apparently a significant figure in the Hispanic community, who himself then gave a wonderful short speech to great acclaim. (I later learned a lot more about Cesar Chavez.) But it was McCarthy whom we had come for, and it was a privilege to hear him, to shake his hand, and to wish him well.
That was in 1968, when McCarthy's 1964 book had been reprinted: A Liberal Answer to the Conservative Challenge. I should have read it then, of course, but I have been glad to read it now at last. It is surprisingly relevant today... when liberals might think an "answer to the conservative challenge" is as much needed as it ever has been.
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Here are some key passages from this almost 50-year-old book:
From the Introduction, "The Banner Yet Waves" -
“The principles of sound taxation have not changed since they were stated by Adam Smith in 1776. A sound tax system, he said, should raise enough revenue; it should be just; it should be easy to administer; and it should stimulate growth.” [p. 13]
“Liberals have been accused of being materialists - conservatives of believing in economic determinism; liberals of lacking faith - conservatives of having no trust in human reason; liberals of perpetuating and sharpening the class struggle - conservatives of advocating unlimited competition, the survival of the fittest as the dynamic of life and progress in society.” [p. 8]
“The basic ideas or
concepts [in the American founding documents] are self-determination, equality,
liberty, and the positive role of government.
Of these basic concepts the only one subject to serious debate is the
last – that of the role of government.
It is on this point that liberals and conservatives in the United States
come closest to ideological or doctrinaire – as well as practical –
disagreement. The other ideas are
generally accepted by both liberals and conservatives.” [p. 10]
“The principles of sound taxation have not changed since they were stated by Adam Smith in 1776. A sound tax system, he said, should raise enough revenue; it should be just; it should be easy to administer; and it should stimulate growth.” [p. 13]
“Liberals have been accused of being materialists - conservatives of believing in economic determinism; liberals of lacking faith - conservatives of having no trust in human reason; liberals of perpetuating and sharpening the class struggle - conservatives of advocating unlimited competition, the survival of the fittest as the dynamic of life and progress in society.” [p. 8]
McCarthy’s comparison between Liberals and Conservatives reminded me of one of my own attempts to address this question:
http://byronderrick.blogspot.com/2011/04/conservatives-liberals-and-american-way.html
Also, as I read McCarthy’s introduction, I was struck by how much his observations on the U. S. of the almost 50 years ago seem like things a liberal might be expected to say today.
So I read on.
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Part I is called “The Scales of Justice,” with the first chapter "Taxes and the Quest for Equity." Here are some of the memorable comments:
“The principles of sound taxation have not changed since they were stated by Adam Smith in 1776. A sound tax system, he said, should raise enough revenue; it should be just; it should be easy to administer; and it should stimulate growth.” [p. 13]
“…Social control objectives will continue to be reflected in our tax laws, as they are today in excise taxes on such things as liquor, tobacco, and gambling.” [p. 13]
“The progressive income tax is a special target of the conservatives. Some even advocate the repeal of the 16th Amendment.” [ p. 13]
“Although there is a continuing debate even among liberals as to whether the rates themselves are proper or defensible, it is generally accepted by liberals that tax rates should reflect in some degree the taxpayer’s ability to pay; that is, the rate should be higher for those in high income brackets. The top rate in the federal income tax scale has been, for many years, 91 percent. [p.14] (emphasis added)
"…Many [of the rich] benefit from special dividend credits and deductions now provided in the law. Many have changed their investments so as to be able to take advantage of the capital gains provisions of the law.” [p.14]
“In his 1961 tax message to the Congress, President Kennedy recommended that the present dividends exclusion …be repealed.” [p. 16]
Moving on, then, here are some passages from the next chapter, "The Myths of Federal Financing":
"The United States is currently engaged in a very important discussion of economic and fiscal policy." [p.19]
"There are three widely and strongly held conservative ideas which bear importantly on this discussion: One, that a balanced budget is an ultimate good; two, that absolute control of inflation is not only an economic good but also a moral good; and three, that government expenditures by their very nature are wasteful and noneconomic." [p.19]
"I must ... make it clear that liberals are not in any absolute or moral sense in favor of unbalanced budgets... [or] inflation - galloping or creeping - and that liberals do not believe that governmental expenditures are never wasteful." [p.20]
Note: The reference to "galloping" or "creeping" inflation was McCarthy's nod to the rhetoric of the '60s, or rather to the clichés
The subject of this chapter - fiscal policy - is the most directly related to my own interests. So far, the statements in this chapter (except maybe for the rhetoric) could have been written by a liberal today. Moving ahead, we find these passages:
"A balanced budget may be good or it may be bad." [p. 20]
"In the years between 1953 and 1960 - the Eisenhower administration - the budget was unbalanced in five out of eight years, and the national debt increased by roughly $20 billion." [p. 21]
"Deficit financing and the extension of credit are vital to the American economy. Credit is one of the instruments which have contributed greatly to the growth of Western civilization and certainly to the growth of the United States." [p. 21]
This part of the discussion reminded me on my own essay:
Let's see what's next:
"A popular position on the part of the conservatives is that the imposition of a federal debt ceiling will result in something called 'fiscal responsibility.' This claim is not supported by the record." [p. 22]
The debt ceiling is certainly a pertinent issue today.
"One of the most serious consequences [of this arbitrary ceiling] is that the ceiling has served as an excuse, perhaps justified by necessity, for highly questionable budget practices. [p. 22]
"Actually the debt ceiling is not an instrument for [keeping budgets balanced]. It is ineffective in times of prosperity, when revenue is high, and has a dangerous, arbitrary braking effect during times of recession. It leads to rigidity in debt management and in thinking with regard to government finance and policy. One Secretary of the Treasury after another has borne this out in testimony." [p. 25]
These comments all still pertinent to our situation today. In the remaining four pages...:
"Sumner Slichter, who has a reputation as a somewhat conservative economist wrote..., "Most important of all, people should realize that the alternative to creeping inflation is a fairly substantial amount of unemployment.'" [p. 26]
"Is a balanced or an unbalanced budget good or bad? The answer must be that neither is economically or morally good or bad in itself, but that each budget must be judged in relation to the whole pattern of facts and forces." [p.28]
"To oversimplify and to misapply slogans is to do a disservice to the whole decision-making process in a democracy." [pp. 28-29] (emphasis added)
Some of these book's comments - including this last one - could be said about any time in any nation's history.
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The next chapter is called, "The Common Stake." Let's see what memorable comments we find here:
"'Get the government out of business" is a popular conservative political slogan. ...The federal government has been actively involved in the business and economic life of the country since the beginning of our nation's existence." [pp. 29-30]
"The issues of government fiscal policy, of credit and interest rates, rates of economic growth, taxes, tariffs, and of government relation to business remain political issues today... ." [p. 30]
"Today" could be 2012 too.
"... American business is primarily motivated by search for profit and individual or corporate advancement, and cannot be expected to respond to all of the demands of a social or economic nature... . Government, on the other hand, has primary responsibility for the common good and, therefore, must assert itself when private interests seriously threaten or interfere with the efforts to achieve it." [p. 30] (emphasis added)
"Regulatory powers serve a number of purposes: They may protect the public, insure a free competitive economy, or promote business activity." [p. 30]
"Almost without exception, federal intervention in the economic life of nation has followed abuse of privilege, or neglect or failure on the part of extra-governmental institutions or individuals to meet the needs of the country." [p. 31]
In 2012 the tension between businesses and public regulation is still, or again, a central issue in our political debates. The next section recalls the statement in the Introduction: "Liberals [have been accused] of lacking faith - conservatives of having no trust in human reason." Moving on...
"In political campaigns it is customary for liberals to charge that government has not done enough for the economy, and for conservatives to charge that the government is attempting to do too much." [p. 32]
"[Liberal] Leon Keyserling ... insists that reasoned judgment be applied to the economy and the business community and to its problems; and that to leave these problems to nature or to the operation of economic laws (which, with some oversimplifications, is called the conservative approach) is to declare for the irrational." [p. 35]
"Technical processes, which includes business and economic processes, must be directed to human ends." [p. 35] (emphasis added)
"The idea of 'survival of the fittest' does not apply to human society... ." [p. 35]
"...Some of the early and simple rules of competition, which work well when there are many small producers competing in a free and open market, do not work as effectively when great concentration of economic power is involved. We must acknowledge that with an increase in power there must be corresponding increase in responsible control." [p. 36]
And in 2012 we must acknowledge that power has become more concentrated in larger and larger multi-national business corporations than ever before. But there has not been "corresponding increase in responsible control" - in fact, to the contrary.
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Part II is called "Of Payrolls and Poverty." I will get to its first chapter "The Poor: Their Plight and Rights" in Part Two.
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