Blind Spots of a Ruling Class

Economist Lawrence Lindsey has written half of a very important book.  In Conspiracies of the Ruling Class, Lindsey provides a spirited critique of liberal technocrats who want to micromanage the economy, and statist romantics who think their alleged good intentions justify any means.  Where Lindsey goes wrong is in defining both our political elites and our problems too narrowly.  Lindsey writes that “the Ruling Class [capitalizations in the original] are fundamentally different from the rest of us.” But that begs the questions: Who are the ruling classes? Who are the rest of us?

The first part of Lindsey’s view is a familiar story to people who consume conservative media.  It is about the creation of the United States as a special land of liberty and the establishment of a Constitution that was designed to limit the government through separation of powers into three branches, a bicameral Congress, federalism, and a Bill of Rights.

There is also the familiar decline and fall narrative of progressives who believe that “they occupy an intellectually superior upper echelon of society” and who attack the Founders’ Constitution because it gets in the way of running other people’s lives.  Lindsey’s use of Ruling Class to describe the power hungry ranging from King George III, to Woodrow Wilson, to Elizabeth Warren seems anachronistic on one level, but, within limits, it is a useful rhetorical device.  Lincoln liked to talk about the divine right of kings in the context of the slave debate.  Lincoln was making a point about human equality.  Lindsey is likewise making a point about arrogant political elites.

Lindsey scores some solid points against his liberal opponents.  He points out how Obamacare was passed through budgetary fraudulence that hid the true costs of the bill, and that the Obama administration has often rewritten the law through executive orders.  Lindsey aptly summarizes the Obama administration’s attitude as “if worst comes to worst, laws should be ignored completely in order to implement policy.”

Lindsey is also correct to note that the Budget Control Act of 1974 had a built-in pro-spending bias.  The law took away the president’s long-established power to “impound” (refuse to spend) federal appropriations and created a largely phony ten-year budgetary window.  The costs of programs are only estimated for the first ten years.  Politicians can create programs where most of the spending occurs after the ten-year window to make the programs look cheaper than they really are.  The Obama administration did this with their health care law by delaying some of the benefits until later years.

While this is all true as far as it goes, we also shouldn’t make too much of it.  A wise and tough president who had the impoundment power might be able to block tens of billions of wasteful government spending.  That is better than nothing, but it would hardly be enough to prevent the demography-fueled implosion of federal government finances.  The current budget process partially obscures the costs of government programs while legislation is moving through Congress, but anybody who reads reports by the Congressional Budget Office knows that our long-terms levels of spending and taxation do not add up.  (Lindsey’s tax plan is admirably blunt about the need for more tax revenue to fund even a reformed government.) Fixing the budget process would help somewhat, but that cannot save a political class that is dedicated to fooling itself.

Which brings us to the main problem of Lindsey’s book.  Lindsey was a senior economic advisor to a president who was himself the son of a president, vice president, and director of the CIA.  It sure seems like any definition of an American ruling class that excludes the Bush family and its senior retainers is a hopelessly partisan construct.

Lindsey manfully admits that he was a senior advisor to three presidents, a governor of the Federal Reserve, and a professor at Harvard University.  Lindsey defines being part of the Ruling Class not so much by offices held, as by ideology and attitude.  The Ruling Class (which he capitalizes) are those in politics, academia, or Hollywood who think “they are the shepherds and we are the sheep.  They ridicule the successful and do everything they can to make the population dependent upon them.”

This definition of the Ruling Class would include an associate professor of literature at a community college, but it would exclude figures like George W. Bush’s press secretary Ari Fleischer and lobbyist Henry Barbour who were part of the team that wrote the Republican National Committee’s autopsy of the party’s 2012 defeat.  Their sole substantive critique of Romney’s campaign was that Romney was opposed to comprehensive immigration reform.  “Comprehensive immigration reform” is a Washington euphemism for a combination of policies that include upfront legalization of our current population of unauthorized immigrants and an enormous expansion of future immigration (both skilled and unskilled.)  Immigration policy was the issue where Romney disagreed with the business lobbies.

Then there was the bizarrely named Citizens for a Conservative Direction.  This was a pro-comprehensive immigration reform front group that was headed by legendary lobbyist-turned Mississippi Governor-turned lobbyist Haley Barbour and was funded by Facebook billionaire Mark Zuckerberg.  This group ran ads in support of an immigration bill that would have increased future immigration despite such a policy being hideously unpopular among Democrats, Republicans, and independents alike.

Now, to an untutored mind, this sure looks like an alliance (conspiracy?) between the super-rich and the well-connected to gaslight America.  From another perspective, it is just cooperation between the hardworking, successful entrepreneurs who “built that”, and noble, well-meaning public servants.

Lindsey’s restricted and self-serving definition of what constitutes America’s Ruling Class obscures political reality over and over again.  Normal citizens can see that Republican politicians, their senior aides, and associated interest groups are as much a part of our ruling class (with or without capital letters) as anyone else, and that our problems exist as a result of the mistakes of our political class in general.

As evidence of the failure of the liberal, statist Ruling Class, Lindsey cites poll numbers showing an overwhelming majority of Americans agreeing that the country is on the wrong track.  That is a little rich considering that Lindsey was part of an administration that presided over the disastrous Iraq occupation of 2003-2006, the financial crisis of 2008, and left office with a Real Clear Politics average job approval rating of twenty-nine percent (or about twenty points lower than that of President Obama in the Summer of 2016.)

That judgment on the Bush administration deserves some mitigation.  The Surge and the Petraeus counterinsurgency strategy stabilized Iraq in 2007-2008, but the Bush administration was too discredited to derive any political benefit for that late, hard-earned, and bloody victory.  The Bush administration had proposed some reforms to real estate finance prior to the housing crisis that helped lead to the deepest recession since the Great Depression, but congressional opposition doomed any chance for reform (though one wonders as to the point of the Republican congressional majorities elected in 2002 and 2004.)

The point is not that Bush was bad and got everything wrong. (Bush got some things right – sometimes against hostile public opinion.)  The point is that public dissatisfaction can’t be understood as a rejection of a specifically statist, Ruling Class.  It is a rejection of political elites in both parties.

These same blind spots obscure Lindsey’s understanding of the 2012 election.  Lindsey marshals polling numbers showing public opposition to increased spending and taxation to argue that there is a “pro-liberty” majority in the country.  One could just as easily find opinion polls where most people are opposed to entitlement cuts and supportive of tax increases on high-earners.  Would that mean that there is a big government, nanny state, pro-Ruling Class majority?

Lindsey argues that the 2012 was not a “Ruling Class versus liberty election.  If it had been, the party that favored more government would not have won.”

That seems half right.  Perhaps the most important question in the 2012 exit poll was the question of who Mitt Romney’s policies would favor.  Fifty-three percent answered that Romney’s policies would have favored the rich and only thirty-four percent answered that Romney’s policies would have favored the middle-class.  People did not see Romney’s message of across-the-board tax cuts, entitlement cuts, and his defense of business owners as a liberty message. They saw it as a pro-rich message.

Lindsey speculates that Romney might have had the right message but, as a millionaire, and a private equity investor, he was the wrong person to sell it.  That is one theory.  Another theory is that people saw the 2012 election not as a choice between a Ruling Class and liberty, but between two ruling classes.  One was a sometimes bumbling and disappointing liberal ruling class that was overly fixated on the poor rather than on the middle-class.  The other was a Republican ruling class that seemed to have learned nothing of value from its failures during the Bush years, and now offered a combination of tax cuts skewed for the rich and endless praise for the wealthy business owners who built that.

In the aftermath of the 2012 election, Republican elites favored the superficial, rather than substantive explanation for Romney’s failures.  They prioritized moving toward an aesthetics of inclusion (illegal immigration as an act of love, stories about dad as a bartender) while shifting policy even closer to the priorities of the business lobbies.

The result was a political disaster.  Trump (and to a lesser degree Ted Cruz) capitalized on the disconnect between Republican elites that wanted to increase future immigration and Republican voters who wanted no such thing.  The eliding of the failures of the Bush administration led to a revolt of Republican Party voters.  It took one of the great (certainly one of the most productive) liars in recent political history to state the obvious truth.  Donald Trump said that, after the Bush administration, “Abraham Lincoln couldn’t have been elected.”  Trump seems to have lied about his own opposition to the Iraq War, but he told at least one important truth.

In one of his later chapters, Lindsey argues for a kind of politics that he calls “philosophically populist, operationally libertarian.”  The problem is that the Republican Party’s inability to learn from its mistakes, and its inability to say no to its wealthy donors has made it seem like less a populist and libertarian party, than an agency for enacting the priorities of the right-leaning rich.  The result is a Trump candidacy that is philosophically populist and operationally demagogic.  Perhaps the path to a successful politics of liberty starts with a little more introspection from the Republican ruling class.