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Pharmakon II: Sold to the Corporate Libertarian

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“Indeed, economist Thomas Piketty observes that the United States presents for the first time in history a society headed towards extreme inequality, driven not by hyper-patrimony (inherited wealth) but hyper-meritocracy…”

Periods of great inequality have frequently coincided with an accelerated pace of intellectual and technological progress. The Greek and Roman societies of classical antiquity, whose systems of governance the West inherited and romanticizes, were slave states. The Renaissance, which gave birth to the ideas that scaffold much of modernity, was also a time of dismal poverty. The modern sophistication and prosperity of European nations is attributable to the imperialistic tyranny they practiced as seats of empires, plundering their colonies into a poverty from which many are yet to recover. Most renowned thinkers and artists—regardless of their century or continent of origin—did not emerge from the largely destitute body of common folk but were the beneficiaries of aristocratic patronage or inherited wealth.

Stark inequality facilitates the existence of a financially-liberated class, whose members are pardoned from enduring the drudgery that robs the average individual of their time, energy, optimism, and initiative. Those in this echelon can receive a private education no public school can match; maintain a portfolio of connections no working man can fathom; devote their productive hours to pursuing endeavors that align with their interests, values, and judgment; and summon capital at the snap of a finger to commercialize potentially profitable ideas. The inevitable outcomes of such an unencumbered life are intellectual and entrepreneurial fruits, the likes of which the average individual—benefitting only from a generalist education of dubious value and having to jump at the first job offer to keep his head above water—can never produce.

It is on the back of this awkward observation on which America currently rests. By following its national philosophy, the country has found itself superficially prosperous, no longer owing to the first principles of liberty, equality, meritocracy, and opportunity. However, due to stark inequality from which a hyper-wealthy class, colloquially referred to as the 1%, has emerged. The American economy is the largest it has ever been, but this top percentile has absorbed half of all real income growth over the last decade.

Some forms of inequality—such as those derived from discrimination—are morally reprehensible to exploit. Some forms—like the uneven distribution of natural resources—are coincidental and seen as fair game to capitalize on. Others still—such as differences in innate talents across individuals—are inescapable and need to be existentially accepted. The American ethos is that inequality within its borders is a manifestation of the last kind. Legal egalitarianism is moral aspiration after all, not an articulation of an underlying scientific conservation law. Different aptitudes and work ethics will lead to some outperforming others. When high-performing individuals associate to form communities, the thinking goes, there will inevitably arise a social order crowned by highly productive over-achievers. For this reason, reducing inequality—whether it be disparities in outcomes between different schools, geographies, businesses, or identity groups—has been rationalized to feel both un-meritocratic and counter-productive, like giving a raise to the worst employee or benching a star player.

Indeed, economist Thomas Piketty observes that the United States presents for the first time in history a society headed towards extreme inequality, driven not by hyper-patrimony (inherited wealth) but hyper-meritocracy:

“…whether such extreme inequality is or is not sustainable depends not only on the effectiveness of the repressive apparatus but also, and perhaps primarily, on the effectiveness of the apparatus of justification. If inequalities are seen as justified, say because they seem to be a consequence of a choice by the rich to work harder or more efficiently than the poor, or because preventing the rich from earning more would inevitably harm the worst-off members of society, then it is perfectly possible for the concentration of income to set new historical records.”

It is precisely the first justification—inequality is a consequence of a choice by the rich to work harder or more efficiently than the poor—that establishes the American national philosophy as the link between meritocracy and economic inequality. It is a conviction held along partisan lines. Among those leaning Republican, 66% believe “hard work, rather than a person’s advantages, has more to do with why someone is rich,” while 56% believe “the reason someone is poor generally has more to do with a lack of effort.” Democrats have a more empathetic outlook: “60% say a person is rich because they had more advantages than others,” while 71% say that “circumstances beyond one’s control are generally more often to blame for why a person is poor.” The Republican conviction has long been considered dubious. For example, a prominent 18th century moral philosopher wrote:

“The difference of natural talents in different men is, in reality, much less than we are aware of; and the very different genius which appears to distinguish men of different professions, when grown up to maturity, is not upon many occasions so much the cause as the effect of the division of labour. The difference between the most dissimilar characters, between a philosopher and a common street porter, for example, seems to arise not so much from nature as from habit, custom and education. When they came into the world, and for the first six or eight years of their existence, they were perhaps very much alike, and neither their parents nor playfellows could perceive any remarkable difference…The employments of people of some rank and fortune, besides, are seldom such as harass them from morning to night. They generally have a good deal of leisure, during which they may perfect themselves in every branch either of useful or ornamental knowledge of which they may have laid the foundation, or for which they may have acquired some taste in the earlier part of life. It is otherwise with the common people. They have little time to spare for education. Their parents can scarce afford to maintain them even in infancy. As soon as they are able to work they must apply to some trade by which they can earn their subsistence. That trade, too, is generally so simple and uniform as to give little exercise to the understanding, while, at the same time, their labour is both so constant and so severe, that it leaves them little leisure and less inclination to apply to, or even to think of, anything else.”

The moral philosopher in question is now only remembered as the godfather of capitalism, Adam Smith, but it is in his magnum opus The Wealth of Nations itself, that he noted these observations. He would be rolling in his grave if he knew that the self-anointed poster-child for capitalism had twisted his ideas into a justification of meritocracy bordering on social Darwinism that he clearly doubted, to entrench a classism he sought to reform.

The second justification—that preventing the rich from earning more would harm the worst-off members of society—preserves the American national philosophy’s momentum, rendering even those who are cynical of the first justification, wistful and reticent to address inequality. The voices of their conscience have been muzzled through a humanitarian argument that prioritizing the pursuits of the wealthy serves the greater good.

Unlike the first justification, the second is bipartisan. It is a train of thought common among liberal technocrats accustomed to the mathematical vocabulary of global optimizations, academics for whom objectivity requires entertaining such uncomfortable notions, and international business leaders privy to the global benefits of the American economy. The commonality of the adherents of this rationalization is, unsurprisingly, that they are not being asked to sacrifice but instead calling on others to sacrifice on their behalf. Although represented as being couched in logic and compassion, this justification is upheld in practice by self-interest.

That the first justification asserts the existence of a moral calculus, while the second implicitly eschews a moral calculus as the means to maximize well-being, is a glaring inconsistency and speaks to the two-faced nature of the American philosophy. On the one hand, there is the feel-good narrative peddled to the everyman to motivate him to work. On the other, there is the unsentimental conviction the powerful will never divulge—that the cost of facilitating the rich, an inequality so steep that social mobility is decimated and the aspirations of the common person rendered futile, is worthwhile. Taken together, it is difficult to not conclude that the American Dream is the marketing device of a gilded society, for which President Donald Trump, with his long history as a con artist and who stands to profit immensely from doubling-down on his message, is a perfect salesman.

Given these two justifications, it is no surprise that the ruling class is so lethargic and impractical about addressing the country’s social and economic issues. It is a strategy of inequality by design whose efficacy is even corroborated by recent economic models. For example, in his paper “Can’t We All Be More Like Scandinavians?,” Massachusetts Institute of Technology economist Daron Acemoglu and colleagues use a game theoretic model to find that:

“…under plausible assumptions, the world equilibrium is asymmetric: some countries will opt for a type of ‘cutthroat capitalism’ that generates greater inequality and more innovation and will become the technology leaders, while others will free-ride on the cutthroat incentives of the leaders and choose a more ‘cuddly’ form of capitalism. Paradoxically, those with cuddly reward structures, though poorer, may have higher welfare than cutthroat capitalists; but in the world equilibrium, it is not a best response for the cutthroat capitalists to switch to a more cuddly form of capitalism.”

If Canada is so great, why are there 350,000 Canadians living in Silicon Valley?

It is difficult to argue with the results of this cutthroat capitalism without feeling sheepish. Which country has the world’s most dominant and dynamic economy? Which state has the resources to maintain the military that putatively keeps the world’s peace, allowing the nations under its military umbrella to exist in a state of idyllic naïveté? Which country provides the most foreign aid and the lion’s share of the operating budget of every major international organization? Why is the United States the first and only country to have put a man on the moon? How can it be denigrated as backwards when it is more than 50 years ahead of the competition?

If Canada is so great, why are there 350,000 Canadians living in Silicon Valley? Why do brains drain south? Sure, Canadian healthcare is great, but even the most fervent naysayers are handily stopped in their tracks by innocently posing the question: “Who is coming up with the cures to all the diseases?” Certainly not Canada. Could Elon Musk possibly have accomplished what he has, if he had stayed in the Great North? Perhaps you cannot have your cake and eat it too. Perhaps a socialist state is doomed to economic doldrums. After all, Canada is a land of economic tumbleweed—good nest material for real estate agents, mortgage brokers, bankers and public sector workers, but not much else.

Could any other country but America host universities of the caliber of Stanford, The California Institute of Technology, or Berkeley? Does any other nation have the capital and intellectual density to stock powerhouses like Google or Tesla? If the American system is broken, why is it the world’s powerhouse of research, the source of essentially every major technological innovation, and home to the most Nobel Laureates? If Europe is such a paradise, why do so many seek out the United States for higher education and why do so many European intellectuals end up settling on her shores? Why does it continue to be the beacon for even its most vocal critics abroad who regularly denounce it as a land of cheeseburgers and rednecks? If one had to place a bet on which country will first put a man on Mars, discover a cure to cancer, achieve a breakthrough in artificial intelligence, or develop a useable quantum computer, is there even another horse in the race?

Any moralizing about the disenfranchised in American society can be readily countered by the assertion, awkward to contemplate but non-trivial to debunk, that American inequality ultimately subsidizes the world’s well-being. The quintessential example is The Bill & Melinda Gates Foundation, credited with saving over 100 million lives by funding public health programs in impoverished countries through its $50 billion endowment. Could Gates have amassed the fortune to accomplish this if he had not been so ruthless in his early years as CEO, or if he had to contend with higher corporate taxes and European-style anti-trust laws? Those left behind in the United States, the thinking goes, are still better off than the wealthy in many other countries, and the failure to appreciate this results in the hand-wringing criticism of the American system.

The national philosophy, therefore, serves to morally justify policy. Slashing taxes on capital gains and corporations (often to effective rates below those levied on middle class incomes) is seen as sensible. Similarly, subsidizing companies, often at the expense of social programs, is seen as optimal. Statistically speaking, given a distribution of wealth, income, social conditions, education levels, and innate gifts among its citizens, America’s approach is to extrude the tail, while social democracies implement policies that budge the median.

While the American system may maximize some economic metrics like market capitalization and GDP by facilitating titan corporations and an ultra-wealthy class, it falls short of diligent social democracies, which enact policies with the average individual and public good in mind, on non-economic metrics. For example, social democracies outperform the United States in comparisons of healthy life expectancy, freedom to make life decisions, and trust in leadership. Even on economically-oriented metrics like educational attainment or per capita research output, comparisons favor social democracies, making it difficult not to suspect that the successes of the United States are not due to good policy but rather owing to economies of scale, which successfully disguise the fallout of bad policy. That so many Americans are struggling and unhappy is because the wrong metrics are used to justify the status quo, even as the country is necrotized by inequality. In a federalist system designed to have states be the Petri dishes for policy, it is telling that the have-not states, which are propped up by transfer payments from the federal government, are overwhelmingly Republican. Considering the Republican ascription of wealth to work ethic, it is both an embarrassing self-incrimination and suggestive that the libertarian philosophy leads to poor output when confounding factors are accounted for.

There are certainly other obvious places to look for the secret to America’s historical success than political philosophy. It is the world’s most populous, developed country, blessed with a bounty of natural resources, situated in a geographic sweetspot with oceans for moats and Canada as a neighbor, bolstered by an exodus of European intellectuals during World War II, and privy to the perks of hosting the world’s reserve currency. How could it be anything but the best given all these boons? From this perspective, the convulsions in American society are the lurching lamentations of a country that has squandered the payout from a winning lottery ticket.

If the policies of social democracies were deployed here, it is argued, the result would be a society both more humanitarian and economically productive. After all, there are 20 million people in the United States that live in trailer parks, 36 million that rely on food stamps, and over half-a-million students that drop out of high school annually. Surely, these cannot be the hallmarks of a well-oiled machine? Even among billionaires; for every Elon Musk, there is a family of Waltons, for every Bill Gates, a clan of Kochs. A lot of human potential is left on the table or squandered outright, and one could just as well conclude that the American strategy is a suboptimal political, cultural, and economic orientation in which the vast untapped capacity of the majority is forsaken to prime the “proven success” of the wealthy well past the point of diminishing returns. Whatever incremental yield can be extracted by throwing more resources at the wealthy is dwarfed by the staggering opportunity cost of not developing diamonds in the rough. Instead of opting to develop a deep, stalwart roster, the bench has been pillaged to support the star player, whom they expect to carry the team.

The current economic climate is the runaway conclusion of the American national philosophy, which has precedent in the monopolies and inequality of the Roaring Twenties, while the New Deal policies of the 1930’s-1950’s are a re-stabilizing attempt in keeping with the default philosophies of social democracies. The current extremized incarnation can succinctly be described as corporate libertarianism.

Corporate libertarianism extends the ethos of personal libertarianism by anthropomorphizing enterprise so that economic dynamics are asserted to be governed by the same moral calculus that supposedly applies to individuals. High autonomy enabled by lax regulation purportedly creates meritocracy at a corporate scale so that businesses operating more efficiently or selling more innovative products increase their market share and achieve larger profits. This is supposed to benefit the whole nation through deliverance of cheap, high quality goods and services, and the establishment of a large corporate tax base.

While personal libertarianism is at least built on superficially sensible principles, leveraging the same anthropomorphic arguments at a corporate level to justify laissez-faire capitalism is fantasy. Most tenets of capitalism are only plausible in the context of an early-stage thought experiment, in which there are a plethora of businesses capable of competing for every market niche. In such a regime, genuine competition is possible and keeps prices down, profit margins low, and encourages innovation, while regulations distort initially level playing fields. As certain companies eventually gain the upper hand and others go out of business however, the real mechanisms by which the survivors increase profit margins and grow market share typically involve innovations of a more conniving nature. These include acquiring and disbanding innovative startups, which threaten to deploy disruptive technologies; mergers that hold markets hostage to abusive pricing; marginalizing employees to reduce the cost of labor; factoring punitive fines as a cost of doing business; lobbying the government for subsidies; exploiting legal loopholes, offshore tax havens, price fixing, planned obsolescence, dismantling unions, regulatory capture, and share buybacks.

Bulkier corporations become incentivized not to innovate or operate efficiently but to maximize shareholder revenue by any means. Given that the average citizen derives his income from wages and not investments, it is hardly surprising that maximizing shareholder revenue rarely translates into well-being for all, as is typically claimed. The gains are largely distributed to the ultra-wealthy who own these businesses or occupy the upper strata of management. That many, including President Trump’s own Treasury Secretary, have credited him for a bullish stock market, using it as an indicator of the country’s economic well-being, is evidence of the pervasiveness of this fallacy. That some economists consider the period since the Great Recession in 2008 a golden time of recovery based on the ticker, leaves many on Main Street, for whom this decade has been one of belt-tightening and bleak prospects, scratching their heads.

While underhanded corporate strategies may yield short term results for the stock market, they are ultimately cannibalizing in the long run. With reduced wages, workers have less disposable income to purchase goods and services, causing profits to tumble. By precluding entry of new players into a market, there is technological stagnation. Corporations do not have to innovate when they are already reaping large profits with existing technologies. As such, countries become less competitive on the international stage—China’s rapid bridging of the technology gap has as much to do with intellectual property theft as yearly iPhone releases. Corporate tax evasion reduces the government budget so that talent pools cannot be sufficiently developed and retained. The tax base needed to finance social programs shifts from corporations to individuals who can ill afford to be taxed more in the absence of a fair wage. Lobbying governments to the point that individual citizens are marginalized is abrasive to democracy, the form of government with the strongest guarantee of property rights, the contract on which private enterprise is built. These inescapable long-term realities are conveniently swept under the rug.

An efficient transit system would not service the suburbs; a profitable mail system would not deliver to the countryside.

Instead, as corporations saturate available markets, they inevitably turn their eye to the public sphere. The logical corollary of the national philosophy is that even public property and social services should eventually become the purview of wealthy private entities. Why is it the government’s job to continue being involved? They were only acting as feeble regents until captains of industry could come riding in. Why should the public rely on government, co-ops, community organizations, religious institutions, or other organizational structures to fulfill certain needs, when corporations can theoretically handle them more efficiently?

The question itself is telling. Private business should not call the shots in domains where efficiency is not the end-all and be-all. An efficient transit system would not service the suburbs; a profitable mail system would not deliver to the countryside. Many domains in society do not demand increases in efficiency or competitiveness; they require accessibility and oversight. Can a plug-and-play corporate solution really work? The incentives that govern business entities—if properly regulated—can be harnessed to great effect, a notion that social democracies too appreciate. But it is a mistake to think that left unchecked, they naturally scale in ways that align with national stability or the public interest. The checks and balances forced upon governments at every turn, which are often decried as bureaucratic inefficiencies, are lacking in corporate environments.

The inexorable result in a corporate libertarian society is that by prioritizing efficiency and profitability, those who are most vulnerable and in need of services that cannot be justified by quarterly reports, are left by the wayside. It is an unstable dynamic that marginalizes the poor, pushes the middle class into poverty, and allows corporations to erode and usurp the rights of citizens. This is epitomized by the 2010 Citizens United ruling, in which the Supreme Court declared corporate spending limits on political lobbying an infringement of the free speech clause of the First Amendment.

When public property and social services are treated only as an untapped hinterland waiting to be conquered by private enterprise, the protection of which is construed as unconstitutional annexation by a power-hungry and inept state, instead of defense of a commonly-owned resource, the net effect is social dysfunction. The American landscape is proof of this. Unfortunately, the necessity of protecting public assets is one that many segments of the American population do not seem to appreciate. This indifference is dangerous in any democracy but is especially problematic in the United States, given the ravenous nature of its political philosophy.

While President Trump sold corruption of the national philosophy as the source of America’s woes, the true culprit is the pillaging of public property and social services, justified by the philosophy itself. An America with strong labor laws, more progressive taxation, strict campaign finance regulations, an equitable public school system, universal healthcare, modern rural infrastructure, and greater investment in publicly-funded media would continue to be an economic powerhouse, while also being insulated from the destabilizing effects of income inequality, globalization, automation, and propaganda. These issues have caused hardship around the world, but nations with beefier social services have mounted a more graceful response and been less perturbed by populist backlash.

There would be no medical bankruptcy in the United States if there were universal healthcare. The high rates of gun violence, incarceration, and drug offenses would be decimated by a more equitable school system and less interference from lobbyists. Greater union enrollment would have buffered the working and middle classes against wage stagnation and provided greater collective bargaining power to resist outsourcing and offshoring. Affordable post-secondary education would have allowed those in disappearing industries to transition to other careers more gracefully. Rural America would not be so isolated if there were greater public investment in deploying broadband technology. The American Dream might still exist if the nation’s engines of social mobility were not scrapped for parts. While citizens in every other industrialized country strive to be their brothers’ keepers, in America, it is every man for himself.

The greater the extent to which public property is neglected and privatized, the more society resembles an auction house. The more moneyed a system is, the faster social mobility vaporizes. Given that the first outcome is the encouraged product of corporate libertarianism, while the second outcome undermines the very premise of the American Dream, it is apparent that the political philosophy of the country is one of a snake eating its own tail.

The inaugural Cabinet appointees in the Trump administration, who seemed to have been selected on the basis of their diametric opposition to the social services their respective departments are charged with overseeing, is glaring evidence of this contempt for public property. Although many have since been sacked or been forced to resign due to ethical breaches, that a President, whose pitch was to restore America, thought to go about doing so by recruiting this crew of corporate pirates corroborates the thesis. These appointments have been roundly lambasted by many scholars and watchdogs as calculated attempts to dismantle departments from the inside out. As each department is considered, it is not difficult to see how President Trump’s policies would disproportionately impact the poor, further stifling social mobility and exaggerating economic inequality.

Billionaire Republican donor Betsy DeVos, who has neither attended nor ever enrolled her children in public school, was appointed Secretary of the Department of Education. She has lobbied extensively in favor of a voucher system, in which parents are guaranteed a fixed level of federal support, regardless of whether their children are enrolled in private, charter, religious, or public schools. The net effect is that wealthier parents are federally subsidized to register their children in expensive private schools, siphoning money away from the public system relied upon by poorer students. This would accentuate disparities in an education system that is already very unfair. On average, public schools source 45% of the funds needed to pay salaries and provide school supplies from the property taxes in their respective district. A school in the inner-city surrounded by dilapidated apartment buildings will have a fraction of the budget of one located in a wealthy enclave filled with double-garaged mansions. Many states also tie their funding contribution (which constitutes another 45%) to test-based performance. When poorer schools, which have the neediest students and are unable to attract good teachers with a paltry budget, inevitably under-perform, they are stripped of funding as a punitive measure. While other developed nations provide funding agnostic of postal code, the American free-market mentality dictates that these struggling students need to be weeded out. An equitable or progressive system is considered an infringement of individual rights in America. It would mean that the wealthy could no longer buy their child a seat at a private magnet school or gain entry to an elite public school by purchasing a mansion in a ritzy neighborhood. Once a student is ready to graduate and enter the adult world, the script is flipped, and his academic maturity is acclaimed as the product of innate brilliance. What should be the main engine of social mobility is inverted to become a primary driver of inequality.

Dr. Tom Price was appointed as the Secretary of the Health and Human Services Department, where he pushed the $765 billion Trumpcare tax cut. He is a former Tea Party supporter who is “devoted to limited government and lower spending” and opposed to the “vile liberal agenda that is threatening everything we hold dear as Americans.” What exactly is “everything we hold dear”? It appears to be the freedom for individuals to opt-out of Obamacare, a policy which requires everyone to purchase health insurance as a way of keeping premiums down on those with health conditions. It is considered un-American because it increases payroll expenses for businesses that subsidize their employees’ insurance and burdens the rich, who can afford on-the-fly one-off medical procedures without having to pay a lifetime of premiums. Even for the insured, high deductibles and an inefficient medical system mean that Americans spend twice as much on healthcare for worse outcomes. In 2014, seven million Americans reportedly dipped below the poverty line owing to medical expenses. There is no egalitarian conviction in the value of a human life, only survival of the richest. Enter American libertarian as social Darwinist.

The Secretary of Housing and Urban Development, Dr. Ben Carson, voiced his support before Congress in 2017 to slash funding for his $50 billion agency by $7 billion. The cuts were expected to force a quarter of a million families “to pay much more in rent and sharply limit their access to housing in safe neighborhoods with quality schools and other opportunities,” according to an analysis by the Center on Budget and Policy Priorities. Secretary Carson believes that “poverty to a large extent is also a state of mind…You take somebody that has the right mindset, you can take everything from them and put them on the street, and I guarantee in a little while they’ll be right back up there,” a two-faced attitude for someone whose path to prominence as a neurosurgeon included food stamps, a self-confessed quality education in Detroit public schools, and a full scholarship to Yale. In keeping with his newfound libertarian understanding of social conditions, Secretary Carson commented in a New York Times interview that homeless shelters should not be “a comfortable setting that would make somebody want to say: ‘I’ll just stay here. They will take care of me’…We are talking about incentivizing those who help themselves.” This is a caustic attitude in a country where the working poor number in the millions because full-time employment at the federal minimum wage is insufficient to make ends meet—and where families with children constitute one-third of the homeless population. What chance do these children have at making a life for themselves? How can this be the land of opportunity? The silent rebuttal hangs in the air—if you could not afford to have kids, why did you have them? Thankfully, most ignore this nonsense or else the United States’ population would be halved in two generations.

The former United States Senator from Alabama, Jeff Sessions, was selected to head the Department of Justice. He advocated for the increased use of private prison facilities, while simultaneously pushing for mandatory minimum sentencing, despite years of research indicating that incarceration is not an effective deterrent. This is doubly problematic considering 73% of immigrant detention centers are run by private companies. Are criminalization of minor drug offenses and the growth of the prison-industrial complex what the country with the largest incarcerated population in the world and second highest incarceration rate really needs? What could the business model for a private prison ever be? They are incentivized to lobby for maximally punitive laws that criminalize as many minor violations as possible and lengthen as many sentences as possible in order to bill the state as much as possible. Why is this approach being prioritized instead of one that emphasizes crime prevention, prisoner rehabilitation, and reduced recidivism? Because citizens are seen as sources of income to be farmed.

In a former life, Steven Mnuchin served as an executive at Goldman Sachs and managed a bank that sold for billions of dollars after “aggressively foreclosing on senior citizens” during the financial crisis. Upon being nominated as Secretary of the Treasury, the department which oversees the Internal Revenue Service, he failed to disclose $100 million in assets and business ties to tax havens like the Cayman Islands. As part of his 2017 tax bill, corporate taxes were slashed from 35% to 21% and across the board income tax cuts were implemented, costing $1.5 trillion in lost revenue. How the government will continue to fund programs is yet to be explained. Conveniently, individual tax cuts are set to expire in eight years, while tax cuts for corporations will remain in perpetuity. Harming corporations would hurt everyone in society after all.

After a series of transient appointments, the Secretary of Labor is now Eugene Scalia, son of the late conservative Supreme Court justice Antonin Scalia. His prior track record includes fighting on behalf of Wal-Mart to defeat legislation which would have required companies with more than 10,000 employees to spend more on healthcare costs; representing Boeing in a complaint brought by the National Labor Relations Board for opening a new factory in a right-to-work state to circumvent union representation; challenging an Obama-era policy requiring advisers managing retirement accounts to act in their clients’ best interests; stopping an Occupational Safety and Health Administration policy requiring workplaces to voluntarily develop safety programs or submit to more frequent inspections; and arguing that MetLife, a global insurance company, should be exempt from stricter oversight imposed on Wall Street firms after the 2008 financial crash. Given that the Department of Labor’s mandate is “to foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights,” his appointment is tantamount to the fox guarding the henhouse.

The Department of Energy manages laboratories that conduct research on renewable energy and is responsible for environmental cleanup efforts and setting energy standards. In 2017, the former governor of Texas, Rick Perry, a climate change denier, ex-board member of the company seeking to build the Dakota pipeline, and a cheerleader for the coal industry, who during the Republican presidential primary said that he would scrap the department, was confirmed as its head. Extending the theme of contrarianism, President Trump’s first appointment for Administrator of the Environmental Protection Agency, Scott Pruitt, in his former role as Oklahoma Attorney General, sued the EPA fourteen times. He is also a climate change denier and describes himself as a “leading advocate against the EPA’s activist agenda.” He was instrumental in President Trump’s decision to withdraw the United States from the Paris Climate Agreement, and, under his direction, 23 anti-environmental initiatives were undertaken in the first hundred days of the Trump administration, including delaying improvements in energy efficiency standards, revoking limits on methane emissions on public lands, and eliminating protections for wetlands and tributaries.

Unsurprisingly, President Trump’s Cabinet is the richest in history, consisting of two billionaires and a dozen multimillionaires, with a collective wealth of over $5 billion. “I love all people—rich or poor—but in those particular positions,” Trump is quoted as saying, “I just don’t want a poor person.” Government budgets are billions of dollars, so experience dealing with large sums of money may realistically help in navigating these jobs. However, the prevalence of tycoon Cabinet secretaries across the gamut of government departments is indicative of the administration’s belief that wealth is a proxy for competence. It is a fitting metaphor for the validity of libertarian ideas that the only thing to recommend this administration, thus far, has been its incompetence. The Republicans have run the least productive government in recent history, somehow managing to force a shutdown in 2018 despite controlling both houses of Congress and the White House.

It would be remiss to not mention the most vulnerable and sacred of all public properties that is desecrated when dictators are praised with impunity, lampoons of the disabled are met with guffaws, war veterans are mocked by draft dodgers, or the Oval Office is defiled into an existential crime scene: trust in the existence of a collective conviction that life ought to be humanitarian and meaningful.

Duluxan Sritharan is a PhD candidate at Harvard University.

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rick burcik
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rick burcik

According to Harvard Mr. Sritharan is a fourth-year graduate student in biophysics but his prior education does not suggest that he has studied economics in any depth. Thus, one might excuse him for not knowing that in a May 2015 article that Prof. Piketty submitted to the American Economics Association titled, “About Capital in the 21st Century”, that Piketty recanted much (most?) of what he wrote in his 2013 book. Alas, all of the careful readers of MW already know that I revealed this truth in my April 10, 2020 MW article titled “In Reply to McManus: Harping on Income Inequality Ignores the Data”. Therefore, I yet again feel compelled to ask — Why do many on the left fail to check their facts before they sit down to write?

David George
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David George

I got to the second sentence ” prosperity of European nations is attributable to the imperialistic tyranny they practiced as seats of empires” before I gave up on the rest.
This assertion has been fully debunked, the prosperity we enjoy is a product of an efficient market utilising the tools of science and technology under an umbrella of law, education and governed by trust.
Plenty of nations that have never had empires follow these basic tenets and are prosperous and free.

Duluxan Sritharan
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Duluxan Sritharan

Given the gravity of the subject, there’s relatively little scholarship. The research that does exist is closely aligned to what I wrote. The most comprehensive study I’m aware of is a 2005 paper by MIT economist Acemoglu, which has ~2000 citations (https://economics.mit.edu/files/4466). Quoting from the introduction: “We document that the differential growth of Western Europe during the sixteenth, seventeenth, eighteenth, and early nineteenth centuries is almost entirely accounted for by the growth of nations with access to the Atlantic Ocean, and of Atlantic traders. Throughout the paper, the term Atlantic trader refers to Britain, France, the Netherlands, Portugal, and Spain, the nations most directly involved in trade and colonialism in the New World and Asia. Atlantic trade, in turn, means trade with the New World, as well as trade with Asia via the Atlantic, and includes colonialism and slavery related activities.” Quoting from the conclusion: “This paper documents a distinctive and interesting fact related to the process of European growth: between 1500 and 1850, the growth of nations with access… Read more »

Duluxan Sritharan
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Duluxan Sritharan

The article in which Mr. Burcik claims Piketty ‘recanted much of what he wrote’ can be found here (http://piketty.pse.ens.fr/files/PikettyAER2015.pdf). Piketty clarifies the limits and applicability of his book’s conclusions, but this hardly amounts to a retraction: “…the way in which I perceive the relationship between r > g and inequality is often not well captured in the discussion that has surrounded my book. For example, I do not view r > g as the only or even the primary tool for considering changes in income and wealth in the twentieth century, or for forecasting the path of inequality in the twenty-first century. Institutional changes and political shocks—which to a large extent can be viewed as endogenous to the inequality and development process itself—played a major role in the past, and it will probably be the same in the future.” This matches the wording in my own essay, which does not make recourse to r vs g at all, but focuses exactly on institutional changes and political shocks. (Moreover, the idea… Read more »

rick burcik
Guest
rick burcik

To MW staff:
Why has my approved comment not yet been posted?

Santiago Madrigal
Guest
Santiago Madrigal

Cuase this is not so simple. Consetvative thbiker do not think that about how the World is more comolex that economicism or utilatarian framework wants to teach us.

It is not about facts. It is about ideology too. The way we see the facts is very important, like it or not. Measure of inequality depends on this.

Also, this is a cultural magazine with all perspectives are wolcome, so you can not see your “refitatioms” about the importante of económica inequality and capitalism responsability with out undermine Interdisciplinary investigations. That’s why your arguments are not sucessful.

rick burcik
Guest
rick burcik

Mr. Madrigal,
I am unclear regarding what you are suggesting in your reply to my comment. Is it your position that your ideology (feelings) should trump my facts?

Duluxan Sritharan
Guest
Duluxan Sritharan

Thank you for your thoughts Mr. Madrigal.

I agree that determining acceptable levels of inequality requires considering issues through lenses beyond simple utilitarianism.

The way we interpret economic data is also very important as you say. Given that the layman is directly (and often brutally) affected by economic decisions, he has every right to opine on a subject where experts themselves often can’t seem to agree on the fundamentals.