26 June 2011

We Have Outgrown Ourselves

In a BBC News article penned by Justin Webb, an argument is made that the U.S. debt--while admittedly larger than the debts of European countries--is more of a political than financial nature.  David Frum argues that we spend entirely too much on health care and need to raise taxes, but that the latter cannot happen because of how reliant our politicians are upon campaign donations.  He's right, of course, but the problem isn't in getting agreement to these ideas, but in what they actually mean.

What we really have in the United States is not so much a political problem, as Mr. Flum postulates, but a legal problem.  Here's the difference between the U.S. and European countries: size.  Not just geographical or population sizes, but in scale of operations.  Think for the moment of roadways.  If you live in Spain, you may not even care how the roads are in France.  But if you want to drive from Madrid to Bordeaux, you'll want to know that there is an easy to follow, properly maintained route to follow.  As a Kentuckian, I don't even have to care about how the roads in Ohio are; I know that the federally operated Interstate will be direct and (mostly) well-maintained.  We no longer live and die within 20 miles of where we were born.
Unlike European countries, we maintain one system from sea to shining sea.
I readily concede that the U.S. Constitution clearly specifies that all powers not specifically relegated to the federal government are reserved by the states.  But we must also keep in mind that the Constitution was written during an era when each state had its own distinct identity.  The U.S. of the time of the Constitution was more like the Greek states than the U.S. you and I know today.  They existed in a state of isolation, especially relative to the rest of the world.  When your national economy is primarily agricultural and you have minimal relations with foreign powers, it's easy to say, "Kentucky will take care of itself."  Then came the Industrial Revolution.

We forget, but Eli Whitney's cotton gin was one of the most important causes of the Civil War.  That invention increased the potential for production and gave rise to a dramatically expansive economy.  Northern factories boomed in the 1800s, driven by the massive output of cotton from the South.  The idea that we're still all little autonomous states only tangentially involved with one another is a fantasy.
Eli Whitney's cotton gin reinvigorated the "peculiar
instituation" that had been on the verge of dying out.
Consider education.  We have several thousand students in my home county who must be educated.  That requires buildings, teachers, administrative staff, cafeteria workers, custodial staff, bus drivers, buses, desks, chalkboards and all kinds of other things.  Yet when the school board presents the bill to the county, the county has to ask the residents to approve higher taxes in order to pay the bill.  Naturally, this vote always comes in, "No."  The kids still need to be taught, whether we want to pay for it or not.  Contrary to popular belief, the world of education is not one glamorous scam where teachers are little more than babysitters living high on the hog for minimal work.  And if you think that schools don't need to spent a lot of money to produce highly educated and skilled graduates, go find me a private school that operates with a public school budget.  Good luck with that.  We all know that a good education is expensive.  We know that a good education is desirable. We just won't pay for it.

When the county whose children need to be educated won't pay the bill, the county asks the state for funding.  The state obliges to a point, dipping into its coffers, but of course with lots of counties full of residents refusing to pay higher taxes, those coffers don't last long.  The state, then, asks for federal money for education, which the federal government provides.  Find me a state that doesn't take federal money to compensate for its own insufficiently funded needs, and I'll show you a state that's entitled to say, "Leave me alone."

Companies that operate on a national or international scale have a very good idea how to play the game.  Factories are built in states that are lax about pollution.  Corporate headquarters are established in states with low corporate tax rates.  Board members maintain a "primary" residence in states with the lowest personal tax rates.  Meanwhile, their products are sold across the globe, the money flows from all places to those at the top, and they in turn go as they please to spend it.  Great for the profits of those at the top, of course, but is it reasonable to protect a haphazard legal system that allows and even encourages this kind of cherry-picking?

In short, we have outgrown the model of state/federal relations that the founders had in mind in 1787.  We have to live in the now, and the truth is that regional nostalgia aside, there is little meaningful value to continuing to differentiate each state in the Union.

James Madison is dead.
It's okay not to worry about him.
We must also remember that the founders established a transient government, so even if they were alive today, their thoughts and feelings would be no more valid than anyone else's who isn't actively in office.  James Madison wouldn't be able to produce some kind of "director's cut" of the Constitution.  They wrote it into the structure of our government that the offices endure--not the officeholders.  In essence, they directed us not to allow them to loom over our decision making.

Conservatives keep screaming about an intrusive federal government prying into their lives.  You know what?  I don't want the Kentucky State Police in charge of protecting me from terrorists.  I want the F.B.I. and C.I.A. on that job.  Our legal and economic system needs to be revised, and the first step is admitting that we are no longer the United States of 1787.  We have outgrown that model.

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