Edward Rhodes explains to "N" why Americans hate taxes, and why US continues to attract world's best and brightest

Wednesday, 24 January 2018 12:29
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By Vassilis Kostoulas
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Noted US academic Edward Rhodes detailed how the United States continues to benefit from the now entrenched notion of "brain drain" occurring elsewhere in the world, as well as from a newer concept: "labor drain".

A distinguished professor at George Mason University’s Schar School of Policy and Government, Rhodes also offered his views - in an interview to "N" - on the difference between the American and European perceptions concerning social welfare, while also explaining the deep-seated resentment felt by a significant portion of US society to "Obamacare".

A distinguished professor at George Mason University’s Schar School of Policy and Government, Rhodes also offered his views - in an interview to "N" - on the difference between the American and European perceptions concerning social welfare, while also explaining the deep-seated resentment felt by a significant portion of US society to "Obamacare".

"Governments naturally tend to become more powerful, and to regulate and to tax more.  It is the duty of citizens, therefore, to push back against this natural expansion of government power, and to try to keep the government – a government that they themselves have created – as limited as possible," he told "N".

He also pointed to a lack of vision in US President Donald Trump's foreign policy agenda, while at the same time referring to a brewing row within the Republican Party between "populists" and "conservatives".

"So it is, we have also the state that wants to make money out of our money," a restaurant owner in Philadelphia recently told me. What is the rationale behind the aversion of the average American towards taxes and the state, out of conviction? Would you say it also has a historical background?

No one likes to pay taxes, but for Americans the aversion to taxes is philosophical as well as practical.  American political beliefs are premised on the assumption that government is a necessary evil – necessary, because some sort of collective action is necessary to protect the individual’s natural rights against possible encroachments by neighbors or by foreigners; evil, because the state itself, through the regulations and burdens it imposes, infringes on the individual’s natural rights.  Governments naturally tend to become more powerful, and to regulate and to tax more.  It is the duty of citizens, therefore, to push back against this natural expansion of government power, and to try to keep the government – a government that they themselves have created – as limited as possible.  Opposing regulation and opposing taxation thus is not simply a self-interested behavior but also a patriotic one.

Taxes are not popular in Europe either, but one recognizes a soundless acceptance and a developed tax consciousness. Actually, Europeans seem to recognize the need for the state to provide certain basic services free of charge, such as health and education, with universal and equal access. What about the USA? Which is the adopted approach as far as the social welfare is concerned?

As strange as this sounds, American political theory starts with the presumption that the provision of social welfare is not a responsibility of the government.The government’s role, Americans historically argued, was simply to allow citizens, either individually or working together in communities or private association, to ensure their own welfare.Not only did the government have no duty to provide social services, government intervention in these matters impinged on individual liberty and was, therefore, a dangerous development.With industrialization in the late 1800s came a recognition that the government would have to step in to allow individuals a fairer opportunity to ensure their own welfare, given the concentration of power in the hands of capital.And with the Great Depression of the 1930s came recognition that the government needed to provide a safety net, to protect the welfare of those who, through no fault of their own, were unable to ensure minimal life standards for themselves and their families.But even so, governmental provision of social welfare is controversial rather than an accepted norm.The vast majority of Americans regard “socialism” – or any sweeping role by the government in insuring social welfare – as an assault on the American way of life, and therefore as “un-American.”Even in sectors like education and healthcare, in which the government does provide at least a minimum safety net, in America we still see a very extensive private system:most healthcare is paid for by private insurance arrangements, and private schools – both religious and secular – are widespread, particularly at the college level.

What was, in general terms, Obamacare's impact on American society and what was its effect on the last US elections?

The controversial nature of “Obamacare” – which expanded the governmental safety net in healthcare and pressured individuals to acquire private health insurance by penalizing individuals who refused to buy it – reflects this tension in American political thought.On the one hand, the increasing dysfunctionality of the American health care system was clearly related to the failure of many Americans to acquire health insurance; but on the other hand, Americans resist the notion that the government has the right to tell them that they must buy health insurance, and resist even more the notion that the government should assume responsibility for providing Americans with health care (and thus be in a position to decide what health care individuals do or do not receive and how much they will have to pay).

The American health care system is clearly breaking down.As the last election indicated, however, there has not yet emerged a consensus on how to fix it, without treading on individual rights.

What is the rationale behind the phenomenon of weapon possession in the USA and how do you interpret the tolerance of the American society, despite the fact that, at regular intervals, it mourns victims?

The right of individual Americans to own weapons is guaranteed by the Second Amendment to the U.S. Constitution, which, as part of the “Bill of Rights,” was adopted at the same time Americans agreed to the Constitution and to the creation of the U.S. government.The underlying logic is interesting, and reflects the deep-rooted suspicion of government on which the entire American political system is built.Because all government has a tendency to grow and to become tyrannical, gradually infringing on individuals’ rights, citizens may ultimately need to overthrow the very government that they originally created, but which has grown to be too powerful.Because the government controls an army, as a practical matter the only way to ensure an ability to overthrow a tyrannical government is to ensure that ordinary citizens, too, are armed.

While as a practical matter many of the Americans who oppose gun control do so because they like to hunt or because they feel the possession of a gun helps them to ensure their own safety and the protection of their property, the underlying reason for opposing gun control is suspicion about the state.“Taking away my gun” is seen as a first step to “taking away my liberty and my rights.”

To which factors do you attribute the high performance of the United States over the past decades, as far as the fields of economy and geopolitical power are concerned, that have rendered it the world's greatest superpower?

The U.S. political system has contributed to American economic growth – and thus to American power and prestige in the world – in two very obvious ways.

First, although a system of government that emphasizes individual liberty and individual right, and that severely limits the ability of the government to regulate individual activities, obviously has numerous costs in terms of ensuring economic equality or guaranteeing social welfare, by the same token this system of government gives individuals greater ability to use their labor and their capital in ways that are economically most productive.Self-interested pursuit of individual wealth, limited only by laws necessary to protect others’ rights to do the same, tends to result in economic growth for the nation as a whole.

Second, a system of government that guarantees individual liberties is attractive to individuals around the world whose governments or whose societies do not permit this sort of freedom.As a result, for centuries the United States has benefited from immigration, as talented and highly-motivated individuals from around the world have decided to take their chances and to move to America.The United States has been the beneficiary of the rest of the world’s “brain-drain” and “labor-drain.”Tyrannical governments, kleptocratic governments, and governments that have prevented individuals from fully using their talents have, since the 1600s, resulted in a continued flow of human resources to America.

Do you think we are going through a period during which the US is losing this primacy on an international level? What are the conditions leading to this development?

Two huge developments are transforming politics around the world, at every level from the household to the global.No one is quite sure how societies around the world will adapt to these developments.It is within this context that one needs to guess about the future of the international system and of the American role in it.

One of the developments is technological.Computers make retaining knowledge and performing analyses vastly easier than ever before.Calculations that in the past would have required a huge, talented, and expensive bureaucracy can now be made by private individuals.And improvements in communication technology now mean that old-fashioned boundaries matter less. The second development is in education.Humanity now has greater and greater individual empowerment, as individuals around the world are better able to make decisions. The combined impact of these two developments is to create new challenges to systems of government, both traditional and “modern,” around the world.

In the wake of the 2001 terror attacks, the Bush administration tried to deal with these challenges by trying to create a new global order under the wing of American military and political power.This obviously did not work.The Obama administration began its term in office with the assumption that political and cultural diversity in global politics would not be a problem, and that it would be possible to build global cooperation on issues such as climate change and nuclear proliferation.At best, the Obama policies were not entirely successful either and, as indicated by the 2016 election, a substantial portion of the American public has indicated a desire for some other approach.

On the one hand, it expresses a strong skepticism about the undertaking of globalization. On the other hand, it evangelizes about tax cuts and boost of entrepreneurship. How do you evaluate Trump’s governance?

The Trump administration entered office without any clear, much less consistent, vision of American foreign policy.It continues to lack such a vision.To the extent that there is any logic whatsoever to American foreign policy today, it is provided by a small number of senior members of the administration who are quietly trying to apply “tried and true” policies from the Cold War era.Because the president himself lacks the ability to grasp the deeper realities of global politics, and because he regards any member of his administration who takes the lead in enunciating some sort of overarching American foreign policy as a personal threat, it is extremely unlikely that there will be any coherent American foreign policy until January 2021, when a new administration will enter office.

Do you adopt the view that the American society is now more divided than ever before? What would you say are the tendencies?

The American public is indeed deeply divided.This, however, is the normal condition.In fact, the American political system is premised on the assumption that the public will be deeply divided, and counts on this to prevent the American state from, in the interest of some permanent majority or consensus point-of –view, becoming tyrannical.That the public is divided is thus neither new nor worrisome.

What is of some concern, however, is the extent to which the cleavages are rigid, and the temporary weakness of the normal pressures to reach across divides to reach some sort of compromise or to lure members from one side of the divide to the other.There have been three key factors that have weakened the normalgravitational forces that pull American politics toward the center.The first has been technological change that has given rise to the “new media,” and made possible the emergence of media outlets specifically tailored to the political predilections of particular audiences and that pander to their political preconceptions.The second has been a move away from “pork barrel” legislative politics, by which politicians from opposing camps might come together to make deals providing special economic benefits for their particular legislative districts.The third has been the emergence of legislative districts that are, in effect, single party districts in which legislators have no pressure to seek compromise.

The last two of these three problems are susceptible to political solutions, and there is an indication that we are likely to seechanges that will reduce today’s polarization.The emerging split within the Republican Party – between populists and conservatives – may also lead to a restructuring of political party structures that facilitate new compromises.Thus the long term picture for overcoming polarized gridlock in American policy-making is probably more optimistic than many observers assume.

How would you describe the key axles of the American governance system? In a recent conversation, you had said that it was made to seek diversity in order to prevent the "tyranny of the majority". You also stood in the fact that one state competes with each other and that this is legitimate.

One of the keys to understanding the American political system is to recognize that the authors of the American Constitution concluded that it would need to be the individual self-interest of American citizens, not some willingness to sacrifice their own interest for the benefit of the nation as a whole, that preserved both the system’s stability and the preservation of individual rights.The essential element is that Americans be sufficiently diverse in their economic, social, and cultural self-interests that the majority would a constantly shifting coalition of different interest groups.In such a situation, every citizen would realize that while he might benefit from a powerful, dynamic government today, while he was part of the majority able to control the government’s actions, at some point in the conceivable future a strong, dynamic government might be in a position to crush him.Given this realization that they will at some point be in the minority, out of pure self-interest all citizens would regard with suspicion any accumulation of power by the government.To function, though, this system requires diversity; in the absence of diversity, a permanent majority will emerge and this permanent majority will facilitate tyrannical government.

The American system also recognizes that a check against any of the 50 state governments becoming tyrannical is that, were it to become so, capital and labor would migrate to neighboring states which preserved liberty and freedom.Given the mobility of capital and labor, states need to compete with each other to provide good governance and to preserve the conditions that encourage free labor and free capital to settle there.

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