by Martin Harris
Much has been written, and more could be, on the history of the Progressive Movement, and how it has morphed into what it was invented to defeat: Chicago politics, a term which encompasses buying votes with “free stuff”; crony capitalism (those who contribute to campaigns win government contracts, permits, and regulatory benefits); and wider-than-ever economic and freedom gaps between “the people” and those who govern them. Progressivism arose in the Gilded Age, when Wisconsin Guv Robert LaFollette (R) led an intellectual and political reaction against ward-heeler politics and privilege by proposing that “the best and brightest”, mostly in academia –“the State is our Campus”– deploy their technical and managerial skills to the science of governance, above crass politics, graft, and personal gain, to free the newly-urbanized masses from corporate-industry low-level mass-unskilled-labor collectivization to seek personal career, opportunity, and economic advancement. Now, the Progressives want to keep the part of LaFollette’s template where they, the top 10% in intellect, understanding, and management, have the obligation to remain in charge of us, the bottom 90%, however unappreciative and ungrateful we may be; but they want to remove the part where any of us can advance our and our childrens’ station in life, liberty, and property (a little John Locke/Thomas Jefferson phraseology, there) as much as our ability and initiative enable us.
Cases in point: the new Progressive fascination with a new tax: on wealth; it was preceded by a slightly older Progressive fascination with a new-in-the-80’s Outcome-Based-Education model, where the focus shifted to the minimum standard for all K-12 students and away from maximum achievement for each student. Both share the new Progressive focus on their own (enlightened, of course) determination of how much opportunity and achievement you “need.” Some trenchant quotes, a. from Harvard professor Anthony Oettinger and b. from the Labor Dept’s SCANS study member Thomas Sticht, illustrate:
a. “The present traditional concept of literacy has a lot to do with the ability to read and write. But do we really want to teach people to do a lot of sums and writing…when they have a five-dollar hand-held calculator or word processor? Do we really have to have everybody literate -reading and writing- in the traditional sense?
b. “What may be crucial…is the dependability of a labor force and how well it can be managed and trained; not the general educational level, although a small cadre of highly educate creative people is essential to innovation and growth. Ending discrimination and changing values are probably more important than reading and moving low-income families into the middle-class…”
Outcome-Based-Education, it’s sometimes argued, had its roots in the Federal achievement testing programs, the National Assessment of Education Progress, started in 1969; others point to passages in Vermont’s own educational-theorist John Dewey’s writings (he never taught a class, his biographers write) about the importance of the collective over the individual; either way, in its own texts, OBE focuses entirely on all students meeting a minimum standard, and not at all on any variety of final achievement level based on individual abilities, interests, and efforts. You can get a sense of the Progressive doctrine within the title of the SCANS “Secretary’s Commission on Achieving Necessary Skills” study: no mention of individual excellence within the governed, lots of concern for what the skillfully-governed and planned (by Prog’s, of course) economy “needs”. With OBE as prologue, recent news reports on pronouncements by government and commentary by observers emphasize the emerging pattern regarding the Progressive view of how much individual wealth (in the Prog view, of course) you personally need. The 5 April Bloomberg Financial News reported that “President Barack Obama’s budget proposal would cap multi-million dollar tax-favored retirement accounts… prohibit taxpayers from accumulating more than $3 million in an Individual Retirement Account. The proposal would generate $9 billion in revenue for the Treasury over the next decade, according to a White House statement released today.” The next day, an on-line investor commentary (Porter Stansberry) contained a William Bonner essay on wealth-taxation, which, unlike the above example, which might possibly not get through Congress, is already in place: one part is the 4% tax on savings-banked and US bonded savings resulting from present low interest rates ( near zero at banks, below 2% in bonds) in comparison to historically normal rates in the 4-to-6% range in past decades; and the other part is the Fed- designed annual inflation rate goal for the dollar: an annual 2% purchasing power decline. Your old-fashioned savings bank account, by official US government-plus-Fed design, is now being taxed away at the rate of 6% annually, as measured by decline in purchasing power; 4% via zero interest rates, 2% via inflation. Parenthetically, those facts explain why flight capital which can be moved, is being moved: in the US, it’s going into equities, farmland, and “art”. In Cyprus and other Euro-Zone countries, barriers against capital movement are already in place, because wealth-taxation has already happened (Cyprus) or is about to (Spain, Ireland, et al). Here’s a Bonner quote with advice to his American readership: “Go ahead, put your money in a bank, let the interest payments accumulate. Ten years from now, you’ll have less than half of what you have today.”
His point: a wealth-tax isn’t in your future, although one just so labeled may be; it’s in your present, if you’re still trying to save as your grand-father did. He makes a further point about the supposed 2% inflation rate: “At the present rate, savers get next to nothing on their deposits, and the official rate of consumer price inflation (CPI) is about 2%. This makes the effective tax rate –or the negative interest rate—about 2%. But if you calculate the CPI the way the Bureau of Labor Statistics did when Jimmy Carter was President, the rate of consumer price increases is more like 10%.” As the “smartest people in the room” (just ask them) Progressives know that an effective way to keep the 90% equal (at a nice low level) is to disable, via (first) invisible, (then) visible wealth-taxes on savings. Coupled with policies which have led to long-term earnings shrinkage, it’s working; primarily against the middle class. Not by accident, but never admitted: the middle class is not a natural constituency for the modern Progressive Party, as it was for its LaFollette-era predecessor.