Inheritance Taxes versus Compulsory Military Service — Which Solution Will Embattled American Capitalism Choose?

Jul 1, 2011 by

A few months back Francis Fukuyama upset Americans with his ominous “Origins of Political Order.” Now we’ve just been slammed again by GlobalScan’s stats on how we feel about capitalism itself — down from 80% positive in 2002 to 59% in 2010, with our under-$20,000 earners dropping from 76% support to a meager 44%.

Fukuyama was a powerful apologist for democratic capitalism in his “The End of History” back in 1992. But there’s much more of Jerry Brown than Ronald Reagan in his new book, which identifies a far less lovable capitalism thanks to a pair of new villains named “tribalism” and “patrimony.” The first of these is familiar to us from our national emphasis upon cultural, linguistic, and religious diversity.

Our second villain is the amount of wealth in the hands of what Hamilton called our “well born,” i.e., those who inherit large sums of wealth and pass this patrimony on to their heirs. As opposed to income, which we all acquire and spend, rich and poor, wealth means actual ownership (usually via stocks) of income-producing assets: farms, factories, grocery stores, newspapers, etc.

As pointed out by the “new” (and less lionized) Fukuyama, wealth stays in the family via inheritance generation after generation — just as in pre-revolution France or Saudi Arabia today. With one percent of our patrimonialists now owning 34.6% of the wealth in the USA, and 10% owning 70.9%, it’s clear why statisticians like GlobeScan’s Doug Miller now assert that, American capitalism is “close to loosing its social contract with America.”

Of democratic capitalism’s two enemies, tribalism is the most visible, and could probably be greatly reduced by reinstating compulsory military service, thereby aligning our casualty figures into closer agreement with our census figures. Calling for higher inheritance taxes, on the other hand, may be more risky, judging from the disastrous results such a call produced for George McGovern in the 1972 presidential election.

Right now an anti-tribalist measure like reinstating compulsory military service might be a winner, especially if linked to educational benefits. Certainly our GI Bill was measurably productive for 16 million WWII vets and for our economy as a whole, judging from the obituaries for the 86-91 cohort that appear in our local newspapers.

Draft or no draft, what Fukuyama and GlobeScan are telling us is that Americans need more “problem consciousness,” especially in our news media. Why should Americans have to read about Fukuyama and GlobeScan in the Economist, a British publication? Why do our private- and public-sector think tanks continue snow-shooing over the same mish mush of “ideas,” as opposed to hard-ball data on the triumph of offshore Standard Worldwide American Dictionary English over multi-dialectal spoken American English?

Most important, why shouldn’t Americans demand that their leaders, intellectual and political, explain their refusal to take Francis Fukuyama’s data and reasoning seriously? For my money “The Origins of Political Order is a graceful 500 pages written by a great American whose words of warning call for acceptance or rebuttal, not an “I’ll think about that tomorrow.”
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Oliphant’s best known book is A Piano for Mrs. Cimino, the film version of which won a Golden Nymph Award at Monte Carlo for Bette Davis. He is a WWII Air Corps veteran, and his eBooks are available from www.npe.ednews.org.

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