Washblog

State Budget Craters By $2 Billion More. The Good News Is....

... Now Progressives are going to have to stop talking about tax hikes and start talking about the value of government.  That's right: "the value of government".

Progressives are nice people, they just have the wrong mental model of government. Government isn't a charity. It's a vital part of an economy and until Progressives understand that government's job is not to do good things but to add value, there's not going to be much Progress.

"Oh come on!" you may be saying, "how can we even talk about this `adding value' when we're $2 billion in the hole?" I know that the income tax will get a lot of cheers at the Jeanne Kohl-Wells function tonight, but in and of itself, an income tax will do more political and economic harm than good. That is, unless we Progressives do the hard work of forming and making the argument that government is worth the money, not because of the wonderful charity work it can do, but because government is essential to prosperity.

I support an income tax and I don't want to get too wonky and theoretical on you, ***but*** we're in a situation where our opponents are questioning that very value of government - and they are winning the argument. They're winning in the media because we're not answering the basic question they are asking (and training voters to ask). Here's why:

The typical Progressive's model of government is this: The Private Sector does the necessary, Government does the good. The necessary funds the good.

This is basically a religious model and while it's charming, warm and fuzzy, it's an inappropriate basis for creating good public policy.

Here's what government really is, in economic terms: Government is a conduit through which value flows between The People and the marketplace in a virtuous cycle.

In economic terms, everything from public transit to public schools to public art is a conduit for value. Whether it's law enforcement, regulation, conservation, subsidy - and, yes, even government charity work - Government benefits society when its actions increase the efficiency and positive reflexivity of value exchange between people and the market (and vice versa, obviously).

Conservatives cite economic value flowing from the marketplace to the government and deny that economic value flows back to the market. Rather than meet their argument head on, Progressives say "But government is good!" Americans are pragmatic, economically-minded people. "Good" will only pesuade them so far.

What does this mean in practice? Well, consider this question: "Why do we educate children?" Education is a very simple proposition. The payoffs are huge and the investment is very small. Conservatives question the underlying value of public education (and everything else public) because they see the value of education in terms of the value to the individual child and family. They believe that the individual child/family will find education in the marketplace if that's what's valuable to them. To this, Progressives say "Education is good!". That's not at issue. What's at issue is who should pay for education and why.  

The value of government is not self-evident. Progressives have to be the people to put the value of government into words and numbers. "Good" is not enough.

In economic terms, we pay for public education because the consumers of education - children - are artificially constrained from providing liquidity to the education marketplace. First, children under 18 cannot borrow money to pay for their education, even if it was wise to lend them that money. Second, while education has a very large, positive, economic value, the payoff from that value is difficult to define and monetize at the level of the individual consumer - particularly of primary education.

We have very solid numbers for the "average" child, but if any individual were to ask a bank for money to pay for childhood education, they would be very uncertain as to whether that investment, individually, would be a good risk. There's just too much uncertainty, particularl if we're talking about primary education

. Banks lend money only if they feel quite certain the borrower more likely to pay them back at a profit. Individual borrowers can't, but huge, collective borrowers like governments can - or should be able to - borrow to invest in education because borrowing to invest in education makes governments more likely to pay their creditors back.

Again, education is a very simple proposition. The payoffs are huge and the investment is very small. Much else of what the government does is more difficult to value, but education is a wonderful model for government because so much of what government does - in economic terms - is to provide valuable information to the marketplace.

Government is still the most-trusted information source in our society. Progressives need to focus on that. Government is also an "expert consumer" of under-funded things that benefit the public and make their work and lives more valuable. Government needs to constantly send the information about the opportunities it sees back to the public - to constantly make the information-backed case for putting a proper, long-term value on what's productive, progressive and compassionate.

We need government that thinks of itself like a public-interest version of a hedge fund.

And where our society fails to deliver on what's productive, progressive and compassionate, the government needs to be the most efficient, open-minded and transparent provider it can be.

Again, the value of government is not self-evident. Progressives have to be the people to put the value of government into words and numbers. If not us, who? If not now, when?

< On Determining Impact, Or, How Stimulative Is Stimulus? | On Murdoch And Google, Or, Hey, Rupert, Where's My Check? >
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wearing khakis now? you got your $800 haircut that takes 45 mins. of preening to make it look like it just sticks up everywhere wildly?

How come this isn't in powerpoint?

/end snark, tagged for the really real dense.

Hey, you notice all that killer message coming from the unions over the arne duncan / gates attacks on teachers?

Or, from the unions over the boeing lies about labor ... ??

(how many airplane tickets do lowly paid serfs buy ... who needs airplanes if no serfs can afford to fly ... gosh, I'm dumb, this doesn't make sense...)

Maybe you didn't notice cuz it ain't happening!

ha ha ha! gotcha!

great diary.

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by rmdSeaBos on Thu Nov 19, 2009 at 07:40:03 PM PST

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They are the infrastructure of our society and the necessary foundation for all market goods.

by eridani on Sun Nov 22, 2009 at 03:24:42 AM PST

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by gibney on Sun Nov 22, 2009 at 02:41:06 PM PST

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We have been informed, here in my new LD, that tHERe IS a PLan. By one of our local state reps (and the State Senator just can't bring herself to vote for an "all cuts" budget).

Thing is, our rep votes like Mr. Speaker. So all the handwringing and gasseous emissions amount to telling us that somebody has a plan, and committees and staffers and so forth have been meeting to come up with it (and our Senator is saying: the League of Women Voters is thinking about this, and our Rep is saying "why haven't they contacted me?").

Who talks to these staffers and committees and so forth? Well to hear our rep. (and numerous others) the County party is in disarray.. which answers no questions at all.

Let me tell you, in case you didn't know: Frank Chopp's Plan is to get re-elected.

by m3047 on Mon Nov 23, 2009 at 08:42:40 PM PST

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I hit "Recommend", but who's talking about the existing holes in the tax system? Can we get some numbers on the impact of tax exemptions/forgivenessess and so forth? All this web crap and they show us what is taken away and what is given.. but not what is secreted from this or that, nor earmarked to that or this. Ain't the web fun?

by m3047 on Mon Nov 23, 2009 at 08:57:51 PM PST

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I agree. But Progressives will have to do this without the help of the State Democrats.

One reason that K-12 education won't be a model for how to talk about government is that, as Rep. Brendan Williams (22nd) has pointed out, cutting programs from K-12 education is "the pricetag for political careerism."

Note that in the last session those who supposedly supported an income tax in the end voted to cut services instead. They will do so again in the coming session. Why? Because the State Democratic Party, by its actions, demonstrated that it supports, above all, the interests of the privileged. I teach in a public high school: I can see with my own eyes what was cut and what wasn't, and whose interests were and were not served by those cuts.

So. You are right. Progressives will have to talk endlessly about "return on investment" and provide the numbers to back it up. We'll have to talk endlessly and hope someone eventually hears us. I know no one really heard me, even after I spoke personally with two of our representatives. And yes, I brought a whole of bag of Progressive arguments and data.

The best (and bitterest) satire I know about all this comes from, not surprisingly, a teacher here.

by DWE on Sat Nov 28, 2009 at 08:39:23 AM PST

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As Marx apparently first proposed, and Adorno expanded on, we have made a fetish of commodities. A feature of state-capitalism is that it tends to commodify everything. One result of education policymakers' obsession with expressing educational outcomes in the narrowest terms of quantitative data is that it has become easier to think of education as a commodity and, ultimately, of children as commodities.

While Progressives may be compelled to speak of education and government in terms of returns on investments, we may find ourselves, if we fail to speak in terms social justice, with a utilitarian outcome in which we view it as narrowly economical to sacrifice the least advantaged among us for the greater good of society.

More importantly, we can't make sense of how the least among us are affected by policies designed to further economic interests that effectively protect and pass on privilege. Anyone who thinks that public education is the great democratic leveler is not seeing what I'm seeing. We all know what most private schools are for. Public schools are more equitable by degree, but they still serve the same purpose. At some point, we have to decide whether we want utilitarian justice or Rawlsian justice. That is, we have to decide whether we really want a society whose purpose, by design, is to maximize the advantages of an economic elite. Or whether we want a society that maximizes opportunity and only tolerates inequality to the extent that we're all better off for it.

by DWE on Sat Nov 28, 2009 at 01:02:55 PM PST

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Private parties use infrastructure.  That's why there is such a thing as the Internet and the aviation industry.  (Boeing's commercial division didn't make a profit for 20 years while being subsidized by government.

An example of the indirect creation of businesses by government in the last century is the Rural Free Delivery act.  Though opposed by "free market" advocates who insisted that country people should pay more because it cost more to deliver to them, advocates of the public good won the argument that we are all one country.

The result?  Companies like Sears Roebuck and Montgomery Ward grew into economic powerhouses by selling just about everything by mail, including the kitchen sink.  The mass market magazine industry also got started then--McClure's Saturday Evening Post, etc.

by eridani on Wed Dec 16, 2009 at 10:58:32 PM PST

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And public goods are a good deal for everybody.

They are not just the conduit for value, but education is the source of the workforce, basic R&D.  Public safety and courts are the conditions for commerce.  And so it goes.

You don't buy public goods with a credit card.  You pay taxes.  If you want prosperity, you produce public goods.  Produced at cost, not at market prices.  They are the basic investments.

Right now would be a good time to buy some.

by demand side on Sat Dec 19, 2009 at 09:33:32 AM PST

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I know that, for example, DWE has been working the heck out of the education numbers, showing the cost of *failing* to educate kids. We also have income numbers associated with increased edcation.

There are excellent public health numbers showing the economic benefit of wellness.

There are even decent infrastructure numbers, especially with respect to transportation, showing the positive impact to real estate values from increased accessibility.

The problem unlike in a private business, those numbers are hard to connect directly to dollars and cents on a balance sheet. To me, the answer is to tie them to creditworthiness. We need to show that better public goods make us better-able to pay back our bondholders.

by dlaw on Sat Dec 19, 2009 at 12:54:17 PM PST

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Government does the good. The necessary funds the good. that true

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