One truth we often say here at the Spherical Model is,
Whenever government attempts something beyond the proper role of
government (protection of life, liberty, and property), it causes unintended
consequences—usually exactly opposite to the stated goals of the interference.
I should count how many times I’ve said that. Anyway, it’s
something you can count on.
So, back when President Lyndon Johnson developed the Great
Society, what did he actually create?
That was the subject of Rep. Dan Crenshaw’s podcast last week with, as his guest, historian Amity Shlaes. You might know her from previous works, The Forgotten Man, about the Great Depression, and her biography on President Calvin Coolidge. Her latest book is Great Society: A New History.
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Dan Crenshaw tends to ask a question and then just listen as the
guest informs. They went back a couple of decades earlier, to see what was
going on. We had won World War II. We were a prosperous nation. We felt
omnipotent. So when President Kennedy set a goal to reach the moon, we thought,
of course we can. So why not tackle the poverty problem?
Shlaes paraphrases Norman Podhoretz, the editor of
Commentary, as saying,
AS: “Well, I thought cleaning up poverty would just be
basically a mopping up action in the United States,” because he’d seen the
achievements of the US in World War II as a soldier. It just didn’t seem like
such a big deal.
Dan points out that Kennedy didn’t look like a Democrat
of today, so he asks her about that:
Dan: Do you think Kennedy would have, if he was still
president, do you think he would have enacted something like The Great Society?
You look at a lot of his rhetoric on free markets. He enacted tax cuts and
pursued free trade policies and sound budgets. Pro-Second Amendment. It’s hard
to see him as a modern-day Democrat. Would he have gone this direction?
She says there are people who have explored that very
question. Ira Stoll, in a book called JFK, Conservative. Also Larry
Kudlow. Her personal opinion is, no, Kennedy would not have implemented the
programs of the Great Society.
He was more conservative than the impulsive progressives
around him: his brother Robert Kennedy, his successor Lyndon B. Johnson, his
brother-in-law Sergeant Shriver. But once Johnson saw his opportunity, he took
it.
Johnson had been involved, years earlier, with President
Roosevelt’s New Deal. He thought FDR didn’t get enough done. So he set out to
finish. By means of the federal government, of course. And he was very
ambitious.
As Shlaes explains,
AS: Lyndon Johnson was a New Dealer. He worked for
Franklin Roosevelt. He led the National Youth Administration as a very young
man in Texas. So, he said to himself, and to others, “I will finish what
Franklin Roosevelt started. He started the New Deal. I will finish the work
with The Great Society, and poverty will be cured.” C-u-r-e. That is the verb
Johnson used. He didn’t say reduced. A very ambitious goal. And, because
we were so wealthy, it seemed eminently possible—get to the moon, cure poverty.
So, what do the metrics say actually happened?
There was poverty. It wasn’t well defined. There wasn’t a
metric until a woman in the Labor Department, Molly Orshansky, invented one. But there were poor people. Shlaes recommended a book, similar to
the recent Hillbilly Elegy by J. D. Vance, also
about Appalachia, called The Other America, by a Catholic idealist named
Michael Harrington. He described the people as really poor. Shlaes says,
AS: And it was true; they were really poor, and they
had terrible problems. “So, let’s do something. Surely we can,” was the
attitude.
Poverty, nevertheless, was on a downward trend, even in the 50s, because of economic growth. So there was something of an effort to step in front of a trend to take credit for it. Estimates show that the poverty rate was declining downward from 20% toward 10%. It hit 11% in 1973. Dan asks, did that mean the Great Society policies were working? Shlaes says no.
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AS: John Cogan wrote a whole book about this, at Stanford.
I recommend it. It’s about entitlements. [The book is The High Cost of Good
Intentions: A History of US Entitlement Programs.] And what he shows is
that, overall—some years you get a different picture—but overall the reduction
in poverty decelerated. And then it stalled. So, you look at the result,
once all the programs are in place, and in the 70s we kind of got stuck at 10%
or so. What does that mean? Maybe 10% of people will always be poor. OK. That’s
very sad. But what’s much more important is what we did… and that was to train
people to believe they will always get entitlements.
That’s the point that caught my attention. If you want to
create a truly great society, how can you get there by incentivizing people not
to work?
Shlaes illustrates with the story of a talk she gave at a
charter school in Arizona:
AS: I was mentioning food stamps, which exploded at
the end of the 60s. And I talked about that. And a student got up and said,
“Don’t you care about the poor? My family is on food stamps. We’re not ashamed.
How dare you shame us?”
I wasn’t shaming them. The answer to that is, everyone comes
to want from time to time. Some people need food stamps. No one would deny them
that. It’s not a shame. But what is a shame is to expect, not only
yourself, but your children and grandchildren to be on food stamps.
That’s what we did to them. We, the voters, did to poor
people. We trained them to dependence. And they don’t deserve that. They’re
more talented than that. We trained them to sell dependence rather than look
for opportunity. We trained our own children to that. That is a shame.
There was a point where they mentioned Andrew Yang and his universal
income. It sounds appealing. But—remember, the consequence is probably going to
be the exact opposite of the intention. So what is the intention of a universal
income? To alleviate poverty, along with the worry about not having the means
for food and shelter. You want people who are free from that worry.
What you will get are people who are not capable of working
their way out of poverty—because you take away the incentive. Why work if it
doesn’t matter?
I’ve heard the theorists, including Yang, make a relatively convincing
argument that changes in technology are going to affect the jobs available—and the
level of thinking necessary to do those jobs. Jordan Peterson has talked about this
to some extent. There are people that not even the military will accept,
because they aren’t trainable. Their IQ is simply too low. It’s a relatively
small percentage of the population. Some have a mental defect. Some are simply
mentally well below average. Technology could make it so a larger segment of
the population fits into that “can’t be trained” category.
But I don’t believe it. We have Down’s Syndrome people among
us. Many can be trained. We see them working productive jobs at Walmart and
Kroger near us. Can they do all jobs? No, but they can do something worthy of
pay. If we didn’t have a minimum wage, there would be more jobs employers would
be willing to hire them to do—something commensurate with the value they bring to
the employer, so it isn’t merely charity on the employer’s part.
No matter how good technology gets, there’s still a whole
lot of menial labor that needs to be done. I think Yang and others overestimate
the ability of technology to clean up messes or do physical labor.
But, for argument’s sake, what if we did provide a basic
income for those who can’t earn enough—because of their very real limitations?
For some, that would mean they’d still need to live with someone who could
supervise their daily living. But for the remaining few low-IQ untrained
people, it would mean aimless and purposeless lives, to replace their
meaningful labor. I don’t think that is a way to improve their lives.
And then you do it for everyone? Universal basic income?
Yang at least does that as a replacement to each and every
poverty program now in place. But still. Not a good idea.
Shlaes offers a little history lesson, to show what we’ve
already considered.
AS: We tried to do that with the universal income
program led by Daniel Patrick Moynihan. It was actually Richard Nixon who led
it. It didn’t pass, because Congress saw it was unbelievably expensive. But
also because Congress saw it—Congress didn’t want people to think they—it didn’t
want to put into concrete the entitlement that you’re supposed to be paid. So,
I’m concerned about that, because I do think it’s bad to honor the idea that
you should always pay people.
Not to mention, Dan says, “Why would you basically tax
people, run that money through a bureaucracy, and then just give them back that
money? That doesn’t seem to make any sense.”
What have we learned? What could actually work? Shlaes
suggests education and training. She has come to like a historical black civil
rights leader named Robert Paris Moses, from New York:
AS: He was a math teacher, and he developed a program
called the Algebra Project on the hypothesis that all 13-year-olds should learn
algebra. And maybe trig, right? And that all can. And the truth is that almost
everyone can learn algebra. They might learn it more slowly than other
people.
Almost everyone can be OK in trig. Most of us can’t do
calculus. We pretend to, but we can’t. So, we’re all closer to being alike than
we imagine.
And, I thought that was a great project. He said African-Americans
will have a better life if they can get a skilled job. And, this project, the
Algebra Project, won a McArthur grant, a genius grant. It never went scaled.
And I think that’s a pity. I liked also about it that it was extremely
empirical. “You can learn algebra; let’s be sure you do. And let’s spend
endlessly to be sure you know algebra.” If you have algebra and you can talk,
you can get a job.
Dan asked about the gap between black and white
unemployment, because the Great Society actually made that worse. Shlaes talks
about that, reiterating that education point:
AS: We undertook many measures that focused on the
black community. And we hurt them. In fact all poor people, but poor people who
happened to be black, we accustomed them to the welfare story. And then the
question is, why are they unemployed? Some of that is, skills are very
important now. We didn’t emphasize skills; we emphasized need. That was a
problem. That’s why I like Robert Paris Moses. If you have enough skills, and
you can talk to grownups—and that’s important—you can get a job in the United
States.
It may not be a good job, but from that job you can learn.
And then you move towards the job that you want. That whole culture is gone.
She then mentioned that unions, another outgrowth of the
Great Society, added to the problem:
AS: Unions were a big problem in the period too.
Unions demanded very high wages. Who loses when unions are powerful?
Underskilled people. New arrivals. That’s very sad. So, I’m mainly concerned
about education and looking forward.
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Dan, as a legislator, questioned what is the federal government’s role in that. He mention some successes of the private sector, in his Houston area district.
Dan: There’s a lot of private sector places,
especially around the Houston area that do really incredible training programs,
and they basically want us to just leave them alone. Which seems right. But how
do I encourage more companies to do what they’re doing. They’re putting people
through—these are definitely low-income, low-skilled people—through a training
program that ends up starting, I think, $70,000 a year. Maybe welding pipes or
whatever it is. And it’s incredible.
That is incredible. These are jobs people who don’t
go to college are getting. Shlaes told another story about free-market
solutions.
AS: In New Mexico, a lot of the Great Society was for Native
Americans as now. Poverty was sometimes appalling, and people improve that on
reservations. The company called Fairchild, whose executives later became the
leaders of Intel, the chip maker, decided they were going to open a factory in
the reservation area in Shiprock, New Mexico. They even had some cooperation
from the government. And they quickly became the largest private sector
employer of Native Americans in the United States. They employed hundreds and
hundreds of Native Americans in chip making.
It was actually something that Native Americans were really
good at, because they had worked with their hands on needlework. And, you know,
that was opposed to having a factory abroad.
Eventually… the more left-leaning radicals tried to take over
the factory, and the company did what companies always do, which is to withdraw
and make the chips elsewhere. Because companies can’t handle big trouble.
But the point was, the private sector generally comes up with
great solutions to help poor people by giving them work and training them.
That is the alternative to the Great Society programs: free
market innovations. She summarizes the actual solution—instead of federal Great
Society programs, which haven’t worked.
AS: A strong economy is the best way to help people
out of poverty. It’s actually a fact.
Imagine if the interferences of FDR had never happened. Then
imagine that the interferences of LBJ and beyond hadn’t happened. Then add into
the equation the boom that happened in the first three years of the Trump
administration, after the Obama malaise—and despite the still existing
interferences. What if we allowed growth to just keep happening?
You want a truly great society? Follow the rules for freedom, prosperity, and civilization. Limit government to its proper role of protecting life, liberty, and property. Get out of the way so a free market can innovate solutions to problems. And, I’ll add, for when there are times when people need a temporary help—or long-term help that is due to circumstances beyond their control: charity and philanthropy.
That system works. It takes a self-governing
people to do it. But it works a whole lot better than government programs.
