Crisis of Responsibility

by David L. Bahnsen

  As I’ll reveal in chapter 4, the financial crisis allowed a broad narrative to form that vindicated many guilty people—individuals walking away from the responsibility of making a house payment they were often completely capable of making, for example. The narrative also condemned many entities without justification, such as those who provided capital to people who would later walk away from what they owed. As I’ll demonstrate, the financial leverage and greed that nearly brought down many financial superpowers was cut from the same cloth as the financial leverage and greed that became systemic across all of society. In other words, Wall Street was no innocent party in the financial crisis, but their greedy actions were within the same negative feedback loop as the rest of society—short sightedness, myopia, buck passing, and total disregard for how one’s actions may affect others.

  The immoral climate ran deep and wide. It did not exclude Wall Street, by any means, but it didn’t begin there either. It was part of a vicious cycle created by a cultural decline of thoughtful interconnected consideration, morality, integrity, and personal responsibility.

  Like each of the popular bogeymen, Wall Street has a core function that is not only good, but vital. Like all the others, it features excesses and cringe-worthy examples of selfishness, but as long as we have capitalism, we will have capital markets. Lovers of liberty and freedom should want vibrant capital markets driving free and open markets of business and innovation. Wall Street’s vital function—providing capital for American business to grow, innovate, fund expansion, and globally compete—should not to be demonized. And yet, where policies do help the privileged few at the expense of the struggling many, we do have a duty to resist and seek change. The ability to match investors and lenders with projects and entrepreneurs is true and indisputable, and there should be no justification for greed, fraud, distortion, corruption, or excess.

  In chapter 6, I’ll dissect crony capitalism and the insidious effects that corruption and special favors create in a market economy. But I conclude these prefatory thoughts on Wall Street by making one thing clear: my defense of capital markets in no way defends crony capitalism. Quite the contrary, crony corruption jeopardizes the very aim of free markets. The net positive effects of Wall Street—matching buyers and sellers, aligning investors and projects, and advising on the most rational use of capital—are diluted when public confidence disintegrates as a result of special treatment or outright fraud.

  Unfortunately, the angst in this new era has failed to delineate between healthy, competitive markets and suspect cronyism. Restoring American prosperity will require not only robust capital markets, which we surely have, but also an American people who believe the financiers are not out to get them. Reacquiring that belief will require an end to the scapegoating, significant reform within Wall Street, proper alignment of incentives, and a societal re-moralization that brings Wall Street along with it.

  Even Stranger Bedfellows

  These same principles can and must be applied to the other popular targets of cultural frustration. Washington, DC, is perhaps the hardest to defend, for there is a significant challenge inherent in the very concept of political power. From the days of a king in ancient times, we know of the propensity for political power to corrupt, to cater to special interests, and to serve the needs of the few and privileged at the expense of the many. But even a rather logical bogeyman candidate like government requires some specificity, doesn’t it?

  Is Washington hurting everyday Americans because it is doing too much, or because it is doing too little? Don’t we often hear both claims? Can they both be true? Is Washington, DC, doing the little guy wrong because DC is big, powerful, and effective at squashing the little guy while coordinating with special interests? Or is DC hurting the little guy because Washington is weak, inefficient, bureaucratic, disorganized, and mostly inept? We need specifics to discern the answers.

  I’ll be the first to confess, it would be easier to defend Wall Street than to defend big government. Neither Congress nor the federal executive branch bureaucracy has given much defense-worthy material to use against the charge of complete ineffectiveness. However, the narrative in this new era seems to be that too much government has done too much harm to too many people. So one can see why it is both confusing and dangerous to suggest that the antidote would be more government doing more for even more people. Government perhaps most clearly deserves to be on the bogeyman list, but it should be placed there for rational and intelligent reasons, not for mere rhetorical convenience.

  The truth about the complexity of today’s angst is this: there is no consensus amongst those who claim to be aggrieved by government as to what the grievance is. That’s another reason why deciding if we are angry because government has tried to do too much or too little is not insignificant. For now, everyone seems willing for both camps to coexist. Indeed, the Trump coalition consisted of both small-government libertarian types who believe government has exceeded its natural role and constitutional place, and those who believe their plight can be resolved by government. These two incompatible viewpoints allied to help Trump win. The incompatibility may not have been deeply questioned in the 2016 election cycle, but how the relationship between government and citizenry is defined in the years to come will be, perhaps, the pivotal public issue that determines the direction of American prosperity.

  It does not make things simpler to acknowledge that all categories of government angst can be justified at times. Surely, we can argue that government has sometimes done too little, sometime (most times) taken on too much (the failure of the national welfare state being a prime example), and often been inefficient and incompetent.

  As a general rule, regardless of reality, people will usually pick the one box that best fits their worldview. If your natural inclination is to believe government should be doing more, you can find case after case for bemoaning too little government action—more federal funding for education, more prosecutions of Wall Street executives, more regulation of energy companies, more money toward AIDS research, and so forth. Those in this camp are usually pretty consistent: if there is a need, that need can most likely be remedied through more government action. On the other hand, there is another camp that consistently echoes the classic joke from President Ronald Reagan: “The nine most terrifying words in the English language are, ‘I’m from the government and I’m here to help.’” For this group, the size of government, not efficiency, is the problem. Government is not only failing in what it is doing; it’s trying to do too much.

  One of the most amazing political achievements of the Trump revolution is how he appealed to both camps despite their totally antithetical views. A large constituency of Tea Party types who would be naturally attracted to politicians like Ted Cruz supported Donald Trump because of their hostility toward big government. At the same time, a unique and unprecedented camp that was generally more prone to support the socialist Bernie Sanders also supported Donald Trump.

  But the strangeness of these two bedfellows of small government versus big government polarizations paled in comparison to the unusual nature of the technocrat camp that supported Trump, believing he will get it done better. For this group, what plagues society is not insufficiently sized government (up or down) but an intellectually and professionally deficient government that needs someone with business acumen to run it. Put someone in charge with a track record of success and competent deal making, their thinking goes, and life will improve. Health care is not a mess because government has taken on too much or too little, but rather because they messed up whatever role they did take. Politicians are not losers because they are power hungry, or because they are inadequately competent, but rather because they are politicians. Their intrinsic inferiority comes from the fact that they are bureaucratic, wasteful, inefficient, and poorly prepared for the task of “getting things done.”

  The separation between these three camps in evaluating government is as old as the
civil magistrate itself, but what is unique in modern times is the willingness of these three camps to fly together on the same political plane. Their shared anger toward the government brings them together, and the reasons for the anger, not to mention the solutions, matter not. It is a truly unique development in political history.

  Once again, however, the challenge before us is to discover where the bogeyman label belongs and where it does not. The great failure of the European experiment over the last few decades has been an obese government. Lord Acton taught us that overly ambitious, centralized power has no chance of ending well. Modern Europe is the greatest nonviolent case study of this truth in history. In America, we view government size as one problem and inefficiency as another, because we fail to recognize that one (size) inevitably leads to another (inefficiency). But we also fail to realize that government grows not because of usurpation, but rather societal transfer—common apathy and popular complacence. Our system of government truly is by the people, for the people. Consequently, the reason big and small government critics can link arms and attack government as a bogeyman is that the government truly is a reflection of the people. (Chapter 10 elaborates on this very point.)

  A representative form of government allows for very few exceptions to this statement of fact. Our government is a reflection of our people. Social ills are eating away the foundation of our society. Those social ills have created a societal vacuum that begs government to step in. The remarkable Yuval Levin argues in his masterful work The Fractured Republic that a big-government model has come about as a result of the ignoring and even rejecting of society’s major intermediating institutions (family, community, church, social organizations, unions, fraternal organizations, etc.).

  Is it possible that we have both a problem of big government and a problem of inefficient and inept government—and we have brought those problems upon ourselves? Have we, the people, handed more control of our lives and futures over to government as we have rejected social accountability and personal responsibility?

  I encourage all visitors to Washington, DC, to visit the Washington Monument. It is a beautiful building with incredible history and architecture. At the top of the monument, however, one can take in breathtaking views of Washington and the Potomac alongside pictures of what that same view looked like at different stages of history. To the north, south, east, and west, one can see government buildings and departments gradually expanding over time. Needless to say, there are no iterations in which the size of government shrinks. The inevitable growth of government is powerfully, though unintentionally, captured atop the Washington Monument.

  Unfortunately, this incremental growth of government is in direct inverse proportion to the responsibility of the American people. Thus our investigation into the government as scapegoat for what ails us must consider where that growth of government is doing harm, where it can be curtailed, and where government activity can simply be improved. Most people are very comfortable saying taxes are too high; very few are comfortable saying precisely what spending should be cut. I believe both taxes and spending are too high for a right-sized government, but do we have a morally capable society ready to share the burden—and opportunity—of a smaller government? (In chapters 11 and 12, I’ll explain how we can reinterpret government through improved financial and cultural remedies.)

  What We Need Most

  China, Mexico, and trade get lumped in with the targets of the day, as well. Make no mistake: we must decipher the real ramifications to the challenges of trade, technology, automation, and globalization. I argue that trade has been a net positive to our economy, the American consumer, and society at large, and yet we must acknowledge that global trade has produced some creative destruction. Those holding out “unfair trade agreements” as their bogeyman of choice have a responsibility to consider the big economic picture, and those defending market forces of trade and technology have a responsibility to consider the downstream consequences of these evolutions.

  The data will show that we face real challenges in the present context, and that those challenges have solutions and remedies available to address them. As we address these issues, we must not panic and pretend that we can stop trading with global customers and partners. That’s simply not a credible option. Yet we can look beyond the bogeyman of trade and globalization and find a far more sensible economic solution than protectionism or isolationism, and a cultural antidote that is far more promising and productive.

  Similarly, the media is another bogeyman that will not emerge from this discussion either with immunity or the label of culprit in chief. The Right is correct to lament the liberalization of the press and their extraordinary efforts to promote an agenda rather than report the news. However, is the press in American culture in such a tragic state because the media has made it so, or because the media is reflecting a tragic culture? Is the media the cause of an epidemic or a symptom? And are the accusations as bad as they may seem? Hasn’t the internet, cable news, social media, and other modern conventions democratized the distribution of reporting and news content? Are both sides guilty to some degree of agenda-driven propaganda versus objectively reporting the news? And, most relevant to this discussion, amidst all the angst over media bias and agendas, can people really claim that a biased press has actually made their lives worse?

  Once again, what we see with the media bogeyman is that the context of the accusation is truthful and accurate—unfair reporting and egregious arrogance—but with nuances that fail to identify cause and effect or eliminate individual responsibility. The media fits the narrative of a composite bogeyman advancing the needs of the global elite and powerful, but that narrative fails to explain how media shenanigans have alleviated personal responsibility.

  Let’s face it. It feels good to pummel a composite bogeyman. Yet the practical benefits are few. This book will fail if it merely bolsters arguments for ganging up on popular enemies of the day; nevertheless, it will also fail if it does not acknowledge the prima facie basis for angst with Wall Street, Washington, DC, foreign competitors, and others. Thus, I will examine each of these bogeymen and others in the chapters that follow. We must understand the challenges they represent and the reasons each entered the fray, but reject the notion that the need of the hour is more scapegoating. We must seek to find not excuses for what ails us, but cures that will heal us. Broad and poorly defined bogeymen will not restore American prosperity in this new era.

  Finance, government, media, trade—all have a role to play, but what we need now is to end our addiction to blame and accept the responsibility that comes from being part of a society governed of, by, and for we, the people.

  3

  DISINTEGRATING RESPONSIBILITY

  The Social Foreshadowing

  to the Present Crisis

  To suppose that any form of government will secure liberty or happiness without any virtue in the people is a chimerical idea.

  –JAMES MADISON

  If 2016 was the year politics revealed the percolating cultural tensions of a new global economy, then perhaps 2012 was the year that those who believe “culture is upstream from politics” knew it was coming.

  Charles Murray’s landmark book, Coming Apart: The State of White America, 1960–2010, was released in 2012 to much deserved acclaim. A political scientist and sociologist with a doctorate from MIT and an undergraduate degree from Harvard University, Dr. Murray examined changes in American culture in the generation that had matured since the 1960s. He purposely isolated his analysis only to sociological data of white America, so as to avoid any accusation of racial bias or affectation. The study provided empirical data and thoughtful conclusions that were powerful and profoundly important for those seeking to better understand an increasingly divided culture.

  The cultural context Murray described became the raw material for the political transformation of 2016. He portrayed a deeply divided and polarized white Ame
rica at risk of “coming apart” further if the root cultural issues were unaddressed. Political commentary in 2016 often described the forces Trump tapped into as novel or new, but in reality, 2016 was more about politics catching up to culture. The forces of frustration had been stirring beneath the surface for quite some time.

  As with many of the issues we’ll examine, the consensus diagnosis that Main Street was rightly frustrated for having been victimized by some other impersonal force or societal institution doesn’t completely line up with reality. The narrative many on the Right prefer is an easy one to grasp: America is a God-fearing nation filled with men and women of industry, family, and faith. The leftist forces of redistributionism, statism, humanism, and elitism have distorted, if not ruined, the righteous efforts of this core American nucleus.

  I find this narrative easy to believe for it facilitates two ideas that are easier to accept than the actual truth of the matter: (1) at its core, Americana remains industrious, virtuous, and engaged; and (2) the bad guy is some chosen -ism closely correlated with elitism (secular academia, biased media, a liberal political establishment, and so on). In this story, hope is always right around the corner, for all we need do is to vanquish the leftism polluting the goodness of the American psyche and the righteous, industrious class will eagerly usher in the city on a hill. As this story goes, the free and virtuous society is hindered, not by the rank and file but by the culturally leftist elites who have thoroughly poisoned our institutions.