Last week in the nation’s newspaper of record, the venerable New York Times, well-known columnist/commentator/Palin critic/conservative impersonator David Brooks mounted his soapbox and told those who harbor doubts about the economic recovery to cheer up because things are not as bad as they seem. He points out, no doubt correctly, that “The United States remains the world’s most competitive economy …” we are the international leader in nearly every important economic sector, and the world’s most creative and dynamic growth engine, with the American share of the world’s Gross Domestic Product actually higher today than it was in 1975, a full generation ago.
So far, so good! Brooks then segues into the heart of his argument by questioning the need for a national industrial policy. He points out that President Obama’s National Economic Council dusted off this idea and is now considering it as a model for development. The National Industrial Policy debate began in the mid-1980s and pitted supporters like Lester Thurow, Felix Rohatyn, and Robert B. Reich against the traditional free market oriented Chicago- school economists who argued that “Industrial Policy” was simply a new title for a neo-mercantilist approach to political economy, and would invariably involve bureaucracy choosing winners and losers in the marketplace and would ultimately stifle innovation and development. This debate seemingly ended with the defeat of the Industrial Policy cabal by the early 90s, but like other bad pennies of bygone years, it has turned up again in the Obama Age.
David Brooks, sensibly, rejects the call for a National Industrial Policy. He dismisses its potential effectiveness and goes on to call for…a National Industrial Policy! Brooks argues that the government needs to formulate a bi-partisan agenda to “…improve the economic ecology”. Unfortunately, Mr. Brooks policy suggestions are, for the most part, politically impossible, qualitatively dubious, and of little substance. He rarely advances beyond the realm of shibboleths and sloganeering. For instance, Brooks argues that the nation should implement the Obama Administration education reforms. He ignores the fact that every Administration since the 1970s has actually advocated education reform. We remember, do we not, the 1983 report entitled A Nation at Risk? We remember George H.W. Bush proposing significantly higher educational funding. More recently, as a nation, we dealt with Goals 2000 and with No Child Left Behind. After all of the dust has settled very little has really changed. American students still score poorly in comparison to Asian and European students, and many high school graduates border on illiteracy. Yet Brooks and his fellow white-wine sipping sophisticates believe that everything will right itself if we simply endorse a new set of mandates.
Brooks next contends that we must “…pay for basic research”. He argues that much of the computer, fiber-optic, laser, and DNA sequencing breakthroughs of the last twenty years came as a direct result of federal research grants. He advances his case and insists that the nation spend 3% of its GDP on research, as we did in the 1960s. We can ignore, for the moment, the questionable assertions that the breakthroughs were the result of government funding, and evaluate the intent behind them. Brooks said earlier that the government failed in its attempt to pick winners and losers among competing ideas and practical systems. He then cheerfully contradicts himself, and proposes that the government should do exactly what he dismissed earlier, to the tune of 3% of the GDP. Imagine that, David Brooks and the New York Times actually advocating about 400 billion dollars of corporate welfare each year, presumably to be apportioned by a National Ministry of Silly Walks!
He then moves on to the well worn chestnut of “…rebuilding the nation’s infrastructure”, irrelevantly noting that Abraham Lincoln spent half of his public life promoting internal improvements. Brooks argues that our infrastructure needs are pressing and that this grave responsibility should be entrusted to a “National Infrastructure Bank, not pork-seeking politicians.” Has it occurred to our Mr. Brooks that a Hamiltonian creation of this type could not become anything other than a bonanza for pork-seeking politicians? Beyond the call for a big-government solution to the problem, isn’t it fair to ask what became of the hundreds of billions of dollars budgeted for highway improvements in the 2006 Congressional Highway Act? Also, we were told last winter that the infamous $788 billion dollar stimulus bill would be directed to “shovel ready projects.” We now know that much of that money went into the pockets of major Democratic Party contributors. Why does Mr. Brooks think that a National Infrastructure Bank would fare differently? Such an agency would become a weapon used to reward some and punish others.
Brooks next moves on to discuss global economic issues arguing that the world consumption patterns are now skewed by the fact that American consumers are now spending less and saving more. He insists that quiet diplomacy focusing on realistic exchange rates is crucially important, but does not say how we can achieve this goal. The Bush Administration actually pursued this tack, but came away empty-handed, and there is no reason to expect the Obama Administration to succeed where others have failed.
Mr. Brooks actually does urge a couple of sensible reforms, but appears oblivious to the political considerations that will sink these ideas immediately. He states that the nation should “…loosen the so-called H-1B visa quotas to attract skilled immigrants.” Immigration policy is always a hot-button issue in America and, regardless of real need, this option would be a tough sell to the American public during the current hard times. Likewise, he advances the perfectly correct idea of lowering the corporate tax rate so that it matches up well with international standards. The Obama Administration, however, populated by soft socialists and high tax liberals, would recoil at the mere suggestion of a corporate tax reduction, and the New York Times demagogues would work overtime to strangle such an idea in its cradle.
The estimable Mr. Brooks concludes his epistle by offering a few more shibboleths and slogans. He claims that the nation should “…encourage innovation clusters” without defining his terms and explaining how this would be done. Similarly he exhorts the nation to avoid “stupidity” by keeping labor markets open, avoiding trade wars with Europe and the Chinese, and rejecting gimmicks like research tax credits and similar quick fixes. Mr. Brooks and his New York Times colleagues insist that this is the New Conservatism, a middle ground between the discredited statist mercantilism of the 1930-1980 variety and the supposedly mindless free market buccaneering of 1980-2007, which Brooks implicitly blames for the current unpleasantness. There is, however, little new in the Brooks missive. This is simply warmed over Hamiltonianism, or if one prefers a more contemporary moniker, it can be labeled “Big-Government Conservatism” of the moderate Republican type. This conservatism is, in fact, not conservatism at all, but is the sum of modern Right Wing thought circa 2009, according to David Brooks and the New York Times.