Tuesday, July 27, 2010

Shlaes Lays Out Humble Federal Policy

Humility is a terrific concept. It's very central to the Christian gospel. SWNID is thinking about trying it sometime.

We think the government should too.

So what would a humble government economic policy look like? The ever-relevant historian of economics Amity Shlaes provides an answer. It means lower taxes for all, less regulation, no more "stimulus," and reduced entitlements.

What's "humble" about all this? Government admits it isn't smart enough to decide in advance who wins and who loses, what will be more or less effective economically. Voters stop trying to squeeze just a little more into their own pockets from Uncle Sugar. Everybody decides that punishing the rich is stupid.

The result? In Shlaes's words:

Humble policy then goes on to concentrate on trying to let our economy become that broad space that future businesses and industries still unknown, might find inviting.

Shlaes tags Mitch Daniels and Paul Ryan as two guys who are getting this. We agree, as consistent Gentle Readers with keen memories will note. Those guys remind us of Calvin Coolidge. We'd be happy to vote for either or both for national office in a couple of years.

Oh, and Shlaes is writing a biography of Coolidge.


JB in CA said...

"Humility is a terrific concept. It's very central to the Christian gospel. ... We think the government should [try it sometime]."

Agreed! But I wonder. Did it simply slip SWNID's mind to mention that business could also stand to invest a little in that valuable commodity? Or does SWNID think that humility is more of a liability than an asset for business, because it can't be effectively leveraged to maximize profits?

Jon A. Alfred E. Michael J. Wile E. SWNID said...

SWNID agrees with Jim Collins, author of Good to Great, that over time the most successful businesses are not just usually but always led from a standpoint of humility. The book has a delightful chapter on this that we warmly recommend.

While we think that greed is universal and intractable and that the genius of free-market capitalism is its channeling of greed into socially constructive endeavors, we also think it patent that virtue amplifies and conserves the gains of the free-market system. So enlightened people will temper and even their greed with virtue, finding their prosperity better assured as a consequence.

SWNID thinks that the public dialogue presently needs most of its correcting on the government side of the arrogance quotient. Public dialogue these days--at least the loudest parts of it--is highly Manichean, with all the light ascribed to government and America's Working Families and all the darkness to Wall Street, banks, CEOs, and the ugly rich. We offer the contrarian's balance, reminding America's Working Families that they'll be much better off if the rich are allowed to prosper than if they're despoiled.

We ask unrich Americans, in other words, to acknowledge that though the rich, unvirtuous as they are, may deserve a flogging, they deserve it no more than the unrich, and the enlightened self-interest of the unrich will not be served by flogging the rich, though it might seem morally satisfying for a moment or two.

Further, we don't think it is our role as a citizen to lecture businesspeople at large. That is our role as an investor or a customer with those businesspeople with whom we do business or who want our business,* but not as a citizen. Since markets over time tend to punish the proud and reward the humble, the public harangue is neither fitting nor necessary. It is our duty, however, to harangue public officials and other voting citizens in public. That's the body politic.

We also think it utterly impotent to imagine that we can shame and exhort businesspeople to make productive investments to strengthen the economy when the business climate is as uncertain as it is presently. We grimly affirm that not all the uncertainty can be controlled, but that part of the uncertainty created by the stated aims, established record and amplified rhetoric of the present administration could be eliminated with a single address from the Oval Office pledging to do what Shlaes recommends.

In sum, we do affirm that moral law is universal, but we leave it to philosophers to articulate that. Our address is purely topical and occasional.

*We presently are considering the launch of an additional blog on which to offer praise and blame for specific commercial entities, large and small, as we find reason to assess them. We welcome suggestions as to the name for such a blog.

Jon A. Alfred E. Michael J. Wile E. SWNID said...

In the second paragraph of the post above, the word "even" should be followed by "conquer."

Anonymous said...

For what it's worth, the company I work for has its own charity to deliver eyeglasses and provide basic eyecare to people in third world countries, etc.



Jon A. Alfred E. Michael J. Wile E. SWNID said...

Anon, we think it's worth something. Philanthropy is becoming the norm in private commerce in our Republic. We doubt its sincerity (of course it's done for PR purposes) but affirm its potency (it does good, whatever the reason). The phenomenon illustrates a different aspect of the notion that the profit motive harnesses greed for public good.

We notice that when advocating taxing the rich, no one complains that Bill and Melinda Gates, aided by buddy Warren Buffet, are giving away billions. By most measures we've seen, philanthropy historically is inversely proportional to marginal tax rates.