Friday, October 14, 2011

What if Moderation Fails?

-- Posted by Neil H. Buchanan

In my new Verdict column, I discuss the Occupy Wall Street protests (OWS) and their potential importance as harbingers of larger protests to come. I do not, however, take the position that OWS is the leading edge of a lefty radical movement in the country. Far from it. Instead, I point out that the current protesters seem to be arguing for little more than moderate, center-left policies. In other words, they are calling on Obama and the Democrats to be just a little less willing to capitulate to Republicans. To the extent that we can determine an overall agenda, the protesters are asking for some mildly redistributive tax policies, along with some long-term investments in infrastructure, education, and the environment. Not exactly weak tea, but certainly not a boilermaker, either.

The OWS protesters are, in other words, asking Obama to stick to his recent script, which he adopted a few weeks ago once he realized that his "only grown-up in the room" strategy -- along with his evident reluctance to stand for anything -- had done much more harm than good. Given all of that, the OWS protests are not the right-wing echo chamber's nightmarish Leninist uprising. They are, instead, nothing more than a group of people expressing their (clearly correct) opinion that the government has been taken over by the financial elite of the country.

Even if the protesters were wrong about that, my column's larger point is that this might be the political system's last chance to deal with festering problems and resentments in a reasonable way. If this movement goes nowhere, the next round of protests could ignite some genuinely dangerous fires. We already have seen some dovetailing of far right and far left views in the calls to abolish the Fed, for example. That radical and disastrous move could be merely the first of many overreactions, should enough people in the country become convinced that the political system is truly broken.

Regular readers of this blog might have noticed that this theme -- the current crisis might get out of hand -- has come up more than once in my posts over the past three years or so. I have become fascinated by the Great Depression, especially its lessons regarding the possibility of cataclysmic social change. We know that there were large numbers of people in the 30's who were drawn to anti-democratic, extreme ideologies on the left and right. The American Communist Party's high point for membership was reached during those years, for example. The Klan and Nazi sympathizers also found many new adherents.

Because of that and other factors, I have always marveled at the hatred that those on the political right harbor for FDR and the New Deal. The most likely counter-factual to the New Deal remains a breakdown of the capitalist system -- not necessarily an embrace of Stalinism, but certainly something that would have combined some ugly nativist tendencies with strong backlash against Wall Street and the business sector of this country. We cannot know, of course, what would have happened, but that outcome seems much more likely than the counter-factual in which people calmly wait for the prosperity that is right around the corner, while the business sector waits until wages have fallen far enough for it to be worth hiring again.

As many others have noted, this logic also applies to the right's hatred of the Rev. Martin Luther King, Jr. For all the blind fury that J. Edgar Hoover directed at King, the alternative was (from the standpoint of white America) surely worse. After Malcolm X's assassination, the Black Panthers and leaders like Stokely Carmichael were openly talking about not being as "patient" as Dr. King. I was in grade school when rioting broke out in cities across the country (Detroit in 1968 being the one closest to my home), and I can testify that white people were genuinely scared that things were getting out of control. Even after King's assassination, his message of nonviolence was a key part of keeping the relative peace. (I express no opinion about the wisdom of any of the strategies adopted by various civil rights groups and leaders. I am only saying that Dr. King's views should have been welcomed by all white leaders, rather than making him a target of their rage.)

What has made the 2008-present period so unique is that -- even though we have an economy that is broken, and a political system that has moved from doing too little to doing nothing at all -- the political radicalism has been entirely one-sided. There certainly is a resurgent right, one that has shown its willingness to blow up the economy in the name of an extreme ideological agenda. It is because one should have expected a "scary left" to emerge by this point, I suspect, that so many people were eager to label the OWS protesters as extremists. They are anything but.

The absence of pressure from the left, in turn, has allowed Obama to forsake the role of FDR or MLK, and instead to be content with minimalism. It is true that he has been fiercely opposed throughout his tenure, but it is also true that he could have, for example, demanded much more from Wall Street in return for continued TARP distributions and Fed support in early 2009, yet he chose not to attach any strings.

The non-existent radical left, however, might have been temporary. The OWS movement does not, at this point, show any tendency toward radicalism (or even unapologetic liberalism). My reluctant prediction/warning is not that the current protesters will suddenly become violent if their demands are not met, but that there is enough pain and hopelessness in the country that we are risking much worse results if the political system continues on its current path.

7 comments:

Charles said...

"They are, instead, nothing more than a group of people expressing their (clearly correct) opinion that the government has been taken over by the financial elite of the country."

This is Public Choice 101 with Regulatory Capture being considered a form of "government failure" in the economic literature. Is the left even aware of this dynamic? I have my doubts.

"We already have seen some dovetailing of far right and far left views in the calls to abolish the Fed, for example. That radical and disastrous move could be merely the first of many overreactions.

Perhaps not. Professor's Selgin and White have a new paper arguing that "The Fed's full history (1914 to present) has been characterized by more rather than fewer symptoms of monetary and macroeconomic instability than the decades leading to the Fed's establishment."

http://www.cato.org/pub_display.php?pub_id=12550

Bob Hockett said...

Do not forget that Professors Schmelgin and Smwhite have a new paper, posted at NBER, empirically proving (a) that the earth is flat, (b) that economic growth rates were higher during the bubonic plague period than at any other time in human history, and (c)that carbon monoxide, benzine, and enriched uranium are essential bio-nutrients in respect of which the population now falls far short of recommended daily doses.

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