Crisis and Leviathan

...At the same time, government authorities tightened their grip on our nation's economy, because they "wanted people to take certain actions but .. . preferred not to jeopardize their own powers and positions by revealing the true costs...

...Higgs returns to this notion at the end of his review of our experiences over this century...

...Our past—even (or especially) that part of it that generally evokes pride—becomes instead an unrelieved, sordid tale of mendacity and lust for power on the part of government officials, limitless avarice on the part of the special interests, and mindless gullibility on the part of the general public...

...fter neatly disposing of these and several other explanations of the "inevitability" of big government, Higgs turns to his own thesis: government has grown in this century, he argues, as the result of a series of national crises—especially the two world wars and the Great Depression—combined with the profound ideological changes these have brought about in American attitudes toward government...

...The very question that prompted Higgs to write—why has government grown so rapidly in the twentieth century?—is too seldom asked, as he points out...

...As a result of this profound ideological shift, all subsequent national crises automatically triggered demands that the federal government "do something...

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...As we face our totalitarian foes today, one of our chief assets is the proud recollection of those moments when, as a united, determined, self-sacrificing people, we faced and vanquished similar such enemies in the past...

...The author himself cautions against this tendency to think of Big Government as One Big Nonhuman Thing (again, his caps...

...Higgs entertains this question only once and briefly, and his answer is, "perhaps...

...Americans, it is true, do not dwell on such notions, being by nature an individualistic, materialistic people...

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...There are, to be sure, many valuable insights in this book...

...Doing something," however, entails policies that inevitably impose costs on the population: private citizens need to be turned into soldiers, and goods and services need to be diverted from private consumption into public programs...

...He is surely wrong, however, to suggest that all such appeals are spurious, or that they are invariably nothing more than propaganda to quiet the masses while government officials and special interests plunder the national treasury...

...Perhaps the most lamentable example of this, for the author, was the internment of the Japanese during World War II—though he insists thatthis was no different, in principle, from the draft and the imposition of economic controls...

...This thesis must face one very basic question: was there a plausible libertarian alternative for handling the crises we faced this century...

...For, when we consider the arguments of that school of thought strictly in the context of contemporary political issues, it is all too easy to conclude that libertarianism amounts to little more than good old-fashioned grousing about "big guvm't" and (in the post-Vietnam era, a by no means unfashionable) opposition to the military draft...

...After each crisis, government control over the market—while diminishing somewhat—nonetheless remains at a permanently higher level: Various parties develop stakes in Big Government—foremost among them the bureaucrats administering its programs and the special interests (especially big business and big labor) who profit from its spending...

...The fullest expression of business-government collusion was the "military-industrial complex" of the Cold War period...

...Missing altogether from Higgs's account of our recent history—as would be true of any other libertarian treatment—are concepts like duty, honor, country...

...Government officials are loath to purchase all this on the open market, however—taxes would have to be raised to exorbitant levels, the full costs of the emergency measures would thereby become apparent, and the subsequentpublic outcry would imperil the policies and their sponsoring agencies...

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...A t any rate, on the basis of the evidence Higgs himself provides, "perhaps" proves to be a wildly optimistic response to this question...

...To facilitate the induction of these unfortunates, their neighbors were urged to "intimidate them into submission...

...And the general public supports this expanded government role, because an unremitting barrage of propaganda, stressing the need for dramatic government action in the face of crisis, permanently alters the nation's ideological climate in favor of Big Government...

...Higgs maintains that no such link exists between increasing economic complexity and government growth: indeed, "the most effective system of socioeconomic coordination" under complex, modern circumstances is the free market—Ythe only one that systemically receives and responds to the ever-changing signals transmitted by millions of consumers and producers...

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...Nonetheless, I fear Mr...

...Big business and other special interests, meanwhile, scrambled to the public trough, operating on the new understanding that "government is an immensely useful means for achieving one's private aspirations and that one's resort to this reservoir of potentially appropriable benefits is perfectly legitimate...

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...Higgs's own arguments compel us to conclude that—unless we were prepared to risk civil war—we simply could not have mobilized through the marketplace the resources necessary to defend ourselves in this century of total war...

...Yet that is one thing we will never be able to purchase on the open market...

...it was sustained by fear of the Soviet Union, which was "kept chronically aroused by Pentagon propaganda" in order to put billions of dollars "into the pockets of [the complex's] privileged participants...

...Given his adamantly libertarian view that virtually any interference with the market is illegitimate, the historical portrait he sketches is not a pretty one...

...The government, therefore—and here we encounter the controversial aspect of Higgs's argument—tries to conceal the true costs, by "substituting coercive command-and-control devices for pecuniary fiscal-and-market means for carrying out their chosen policies...

...I suggest that our national leaders may be forgiven for preferring not to venture onto the field of battle against the likes of Hitler and Stalin, armed with a "perhaps...

...It is, he concludes, a system of "participatory fascism...

...and at their worst, government 38 THE AMERICAN SPECTATOR JULY 1987 words, it instead would have found itself fending off its own citizens...

...Now I have to confess, people who talk about "Big Government" make me nervous...

...The usually unchallenged presumption is that such growth is somehow natural—the necessary by-product of modernization and the development of a complex, urban industrial economy...

...Higgs is quite correct to argue that our national leadership tends toabuse this aspect of the American character—to insist that there is a "crisis" when there is none, and to plead for war-time sacrifices in times of peace...

...In the final analysis, we learn from Higgs very little about our history, but a great deal about the grotesquely distorted image of it that appears when we view it through the lens of doctrinaire libertarianism...

...That is precisely the asset Higgs's account of our history would deny us...

...regulatory bureaucracies, coopted by their corporate clientele, actually help establish and maintain the very monopolies they were designed to prevent...

...Higgs is clearly a partisan of untrammeled free markets, and so believes that the initial and critical step in this ratchet-like process of state expansion—government's decision to conceal crisis-generated costs by displacing market mechanisms—is unwise, unnecessary, and, more often than not, unconstitutional...

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...With each succeeding crisis, such devices "military conscription, wage-price controls, assignment of official priorities and physical allocation of selected commodities, countless economic and social regulations, import quotas and export controls"—are applied more and more expansively to the economy...

...That is, could we, in fact, have purchased on the open market the manpower, goods, and services those occasions demanded...

...The draft amounted to nothing more than an "inefficient tax on the labor, services and lives of certain unfortunate young men . . . at the insistence of politicians and other citizens unwilling to pay the full cost of maintaining the military establishment they desire...

...Our political economy today, he declares, nominally leaves property in private hands, but otherwise puts it (and all other rights) utterly at the disposal of the government...

...The system's democratic trappings serve only to legitimate this arrangement...

...Apparently profit was the chief purpose of the Cold War, which started only when "America ceased firing at the Germans and Japanese [and] turned their silent but still loaded guns toward their former allies, the Soviets...

...When, however, we consider how some of America's "finest hours" appear, seen through libertarian eyes, we begin to appreciate just how profoundly subversive a doctrine it potentially is...

...He suggests, for instance, that our government unnecessarily dragooned millions of hapless individuals into the armed forces through compulsory military service—a system, he argues, of "involuntary servitude...

...The Progressive Era, he suggests, established the intellectual preconditions for this process: during that period, our political and economic elites—heavily influenced by socialism—lost faith in free markets and limited government, and embraced instead an ideology "that not only tolerated a greatly expanded role for government . . . [but] positively insisted on such activism...

...They are usually the ones who send me letters scrawled on Big Chief tablet paper in three different colors of ink, warning that The State is some sort of mysterious, demonic force, capable of transmitting subliminal commands to us through our fillings...

...Meanwhile, Higgs maintains, notions of private property rights and civil liberties went into full eclipse, with scarcely a word from that guardian of limited government, the Supreme Court...

...Higgs ultimately falls into that trap himself—and government becomes, for him, One Great Fascist Monster...

...Government might be William Schambra is co-director of constitutional studies at the American Enterprise Institute...

...From this maelstrom of human viciousness and folly emerges a regime barely distinguishable from those of our totalitarian foes...

...Higgs concludes from this episode: "Thus did the United States government, at war against Hitler and his band of racist fanatics, demonstrate that it differed from the enemy only in degree...

...Furthermore, he reminds us, government often seems less interested in ensuring strong competition in the market than in shoring up weak competitors...

...We experienced such moments during the two world wars, and, to some extent, during the Depression...

...Much of Higgs's book is devoted to an analysis of the way we did in fact mobilize resources to meet our crises, and how this record bears out his "ratchet" theory...

...At the precise moment when the government most needed to concentrate its energies against foreign enemies, in other CRISIS AND LEVIATHAN: CRITICAL EPISODES IN THE GROWTH OF AMERICAN GOVERNMENT Robert Higgs/Oxford University Press/$24.95 William Schambra able to coordinate a simple economy, he suggests, but never a complex one...

...As for the familiar argument that larger government is necessary as a "countervailing power" to control the monopolistic tendencies of the giant corporations that have sprung up in this century, Higgs notes that "under conditions of dynamic competition neither a firm's bigness nor an industry's high concentration poses a serious threat to the welfare of the public...

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...Yet this uncompromisingly libertarian perspective on our history is, perhaps, the most valuable aspect of Higgs's book...

...Nonetheless, there are moments when we are willing and able to put aside selfish pursuits, and exhibit a nobler range of impulses...

...His central premise, after all, is that the policies demanded by crisis would have been so costly at going market rates that they would have provoked widespread domestic disturbances, and "threatened the viability of both the policies and the . . . leaders...