PrintOctober 18, 2009
Silver Coins for the Silver Haired
The republic is suffering. The president is proposing a lot of measures, most lately, a $250 check to seniors distraught over the lack of an inflation payment increase due to a lack of inflation.
Twenty-one centuries ago, the republic was suffering. Many people, especially those in the city of Rome proper, were broke, lacking jobs, land, and opportunity to advance. The rulers grasped at straws to solve the problem.
Politicians found solutions. The brothers Gracchi proposed redistribution -- taking land from senators and distributing it to the public. The Gracchi's plan won public support when they each ran for tribune (though in the case of the Gracchi, the victories came at a more immediate cost than most prizes). Others copied their approach later with more delicacy and more personal success.
Generals found solutions. They celebrated victorious campaigns with a triumphal march, proudly displaying the spoils of battle -- and sharing some of the spoils with the people, giving bread and other handouts -- often in time for the next election.
Some gained votes so they could do things for the people. Others did things for the people so that they would gain votes. Either way, the government was beginning to make it their business to take care of the people. They found it costly, but they did it.
When bread wasn't enough, they gave out land. When land wasn't enough, they hosted gladiator contests to entertain the public. When gladiator contests alone weren't enough -- get this--- by the beginning of the second century A.D., they were flooding the Colosseum to stage simulations of naval battles. Of course, it took a while to get to the point where they could afford to do that. The more the public wanted from government, the more the government tried to provide.
So the republic grew. They had to conquer more territories to bring back spoils. And the republic grew. They had to rule more provinces to collect taxes. And the republic grew. They had to build roads to employ the people, and raise taxes from them to pay the people who built the roads. And the republic grew. How else could the government pay for enough roads, bread and circuses to satisfy the mob?
Too late the Romans learned that the more the empire grew, the more untenable this formula became. The bigger the empire, the more difficult to defend the frontier. The more citizens to tax to fill the public coffers, the more mobs to satisfy by distributing it all.
For 1500 years, people have asked why the Roman Empire fell, but savvy economists have always known: the seeds were sown centuries before, before it even was an empire at all, back in the days of the republic. The decline began with the government's decision to pay for food, to pay for votes, to pay for games and other distractions to mollify the public. Even as the empire grew, it was decaying from within. It was built on an inversion of the proper role of government.
Our founding fathers knew this. They had studied history, and they learned from it. They knew that once the government gets in the habit of trying to provide for people's basic needs, they have set their feet on a downward spiral. The government cannot do it. Government simply cannot create wealth.
So the Framers built a government that would instead enable people to provide for themselves. They studied Adam Smith, and elected their greatest expert in international trade policy as our first president. Yes, long before he commanded the troops in the Revolution, George Washington was an early champion of economic self-sufficiency, leading a coastwide boycott of British trade in the 1760s, in an effort to end George III's stranglehold on our import/export activity.
The Framers wrote the Constitution, and gave the indispensable Alexander Hamilton a free hand in those early years (well, almost free, anyway) to do what was necessary to set our economy on a road to independence. Because in these United States, the goal was not only independence from the British government, but independence from government in general.
Our system of government (both state and federal) was designed to enable a successful and free economy. To provide roads and a stable currency for commerce, a system of civil and criminal laws to minimize cheating, elimination of interstate duties, standardization of import duties. All to enable the citizenry to build our own economy, unfettered by onerous government regulation, not dependent on government assistance other than the provision of that basic framework. And it worked.
This nation was never perfect, never had a golden age of universal happiness (there is no possibility of utopia on this world), but it was the most successful economy in human history for a hundred and fifty years. We enjoyed growth and opportunity; panics and depressions generally resolved themselves in time, and people could move from poverty to the middle class, from the middle class to wealth, without government standing in the way to crush their opportunity.
Then came the 1930s. In the decade in which much of the Old World was stuck in a trap of statism (call it what you want -- Nazism, Fascism, Communism, Socialism -- they're all statist), the USA lost its way and joined the way of the Europeans. No, not in establishing a hard tyranny of the military, but in establishing a soft tyranny of government management of more and more of the economy. FDR established the WPA (make-work programs like bridges and roads to nowhere), established the Social Security Administration (going beyond just distributing bread to the poor, government would provide for the very livelihood of the elderly), mandated federal insurance of the banking community (putting a single government body in charge of both the regulation and financial insurance of the banks).
Not only did all this fail to end the Great Depression, it set us on the path of Rome. American government is now responsible for more and more. American individualism and self-sufficiency are under attack, as politicians declaim "the people cannot do this, only government can." From offering a hand to the few who can't make it on their own, government today makes it a self-fulfilling prophesy by rendering it more and more difficult to make it on your own.
So HEW and then HUD built skyscrapers to house the poor. The USDA issues food stamps to feed the poor. State and local governments operate the schools to propagandize, I mean, to educate the poor.
But there weren't enough poor people voting... so now they do the same for the middle class and wealthy. Government now operates the nation's biggest mortgage lender, FHA, to control homeowners. Government runs not only most schools for the poor, but most schools for the middle class and wealthy as well. The USDA doesn't just give cheese to the poor, it buys it from the rich, in agriculture price supports.
The only true minority in modern America is the person who isn't dependent on government for something.
So this year we see President Obama producing "stimulus" plans to make work for construction union workers, and to throw money around politically connected districts. We see him proposing free health care to mollify the currently sick and calm the long-term fears of the currently healthy. We see him grasping at straws to stall foreclosures, using federal funds to try to keep people in their homes another month or two, in the desperate prayer that the economy will magically improve despite all the punches it has taken from the political class.
The latest offer is a $250 check for seniors. Like the Gracchi, the Julio-Claudians and Flavians long ago, this government believes in winning votes and support by handouts to the people. It isn't only a brazen electioneering scheme -- it is that too, but that's not the main thing -- it's the way they think. They really believe it is right for government to be not only the provider of last resort, but also the provider in general, of food and drink, of housing and healthcare, of entertainment and education. And they question the morality of anyone who dares challenge that view.
Has Obama put us on the path of Rome? No, we've been walking down that road for a long, long time. But like Tiberius Gracchus, Gaius Marius, Pompey, and Caesar, he believes that a ruler should distribute things to the people; he believes that's how government does work, should work, must work. And, like each of them, he has the potential to exacerbate the rate of that governmental usurpation of the economy during his reign.
Many things caused the decline of the Roman empire, but foremost among them was the seed sown long before, in the days of the Republic: the idea that government should not just provide a solid framework for an economy, but virtually be at one with the economy.
I refuse to believe that it's too late for America. But we must turn away from the path of destruction that we've been on these eighty years. We must cease this use of our nation's capitol as an endless dispensary for checks and jobs. Or the historians of the future will compare our president not to Marius, not to Julius, but to Odoacer.
John F. Di Leo is a Chicago-based Customs broker and international trade compliance trainer. A former county chairman of the Milwaukee GOP, he has now been a recovering politician for twelve years and four months.
