Sizing up Arguments on Government Versus Corporate Bigness

Two sided arguments are abroad in the land. One of them is about the conflict between Big (Federal) Government, as in “tax-and-spend”, and Big Business, as in “too big to fail”. I recently posted a small blog on binary thinking and the above conflicting phrases can certainly be seen as framing opposing stances. But they are many aspects to the issues. One is just the idea of private business-public government conflict. Juxtaposed this way it is presented as something like an athletic contest between the two. Indeed many of us identify with one pole of these 2 choices. But this seems too simple a position and leaves out the process by which we come down towards a side. That process should be rational and empirical. Doesn’t it matter what the specific issue of government or corporate activity is? Shouldn’t it matter whether we take a short of long-term view of the issues? Many of us might agree that both government and private institutions are challenged if not damaged. But why?

One aspect of any comparative analysis that should be addressed is the implied argument that it is bigness as opposed to an implied smallness that is a problem. Here the modifier big might be used to describe institutions that have grown excessively large, and in the process corrupt and/or inefficient.

The two aspects of the contrast (gov vs. bus and big vs. small) are intertwined, but we can start a discussion with some thoughts on the private-public dichotomy. Like many liberals contemplating the government vs. business issue, I personally think that there are examples to show the weakness of an argument singling out big government for the blame. For one thing Federal government, in our founder’s words, was a necessary evil and part of a balanced system. Arguments that “government is THE problem” smack of too much of a simplification. They appeal to an almost religious feeling of an innate evil that is inherent in government, but not true of other institutions. Even milder, criticism couched in skepticism toward the government’s ability to do good, seems ideological and unbalanced. On the surface it appeals to skepticism, but supporting arguments are narrow and seem more like crank complaints, when the facts and arguments themselves are analyzed. A good example is the almost religious fervor arguing against government regulation to address climate change. This so called debate is full of rhetorical arguments that remind me of arguments I hear from creationists and the Intelligent Design folks. The arguments give the appearance of legitimate, open debate, when in fact there is almost no serious argument in the scientific community. Instead one is presented with a faith-based or ideological argument that has as its 2 real goals:

· Raising doubts about data, theory and conclusions where scientific consensus already really exists.

· Preventing agreement on actions that the government can take on behalf of the public.

This is a combination of denials – of the agreement on a problem and on the need to take action. Indeed one often sees anti-government action arguments the 5 characteristics of what John Cook calls scientific denialism (http://www.skepticalscience.com/5-characteristics-of-scientific-denialism.html):

• Conspiracy theories
  When overwhelming scientific opinion concludes X, denialists challenge that X was arrived at independently with sound evidence. Instead, the claim is that there is a vast scientific and secretive conspiracy using 'junk science'. In the case of government programs such as healthcare the claim is that there is a plot to take over healthcare and have the government run it. But the facts of the current reform are not that.

• Fake experts, false facts & loud messaging
  Crank individuals are pointed to as real experts. But their views are like Creationists - inconsistent with established knowledge. Good examples of fake expert exist from the asbestos and tobacco industries, who hand-select favorable researchers and then spread their claims in an attempt to drown out independent conclusions. Efforts to block government oversight often have arguments from people who are not real experts.

• Cherry picking
  This leverages the 2 above factors to give disproportionate weight to isolated papers, usually not peer reviewed. These often pick at the edges of consensus giving the impression that fringe findings are real challenges to the broad, commensurate body of research. Criticisms of government by the Cato Institute and economic plans from the Hoover Institute often smack of cherry picking and a rush to conclusions that are not subject to critical analysis. Certainly there is little consideration given to the other side except to imply that it is evil. One looks at how raising taxes on the top 1% is treated in the current budget debate.

• Strawmen and Impossible expectations of what research can deliver
  Examples of this are arguing that climate change models can’t predict how warm winter will be in DC. If it can’t do that is must be wrong. Right? Or why have government regulation of carbon if the science is so imprecise? Why believe the value of an economic stimulus if it can’t predict unemployment rates within a percent? All of these create strawman expectations about what good science knows or what good policy can do. Cautious suggestions from economists should be considered as opposed to wild claims such as trickle down economics which makes wildly confident predictions. These can be manufactured to set expectations on what knowledge is needed to make an informed decision.

• Misrepresentation, irrationality and logical fallacies

Columnist George Monbiot points out that conservative contrarians, who consider themselves skeptics, are in reality often selectively gullible and are easily mislead by poorly reasoned arguments. They suffer from conformatory bias and will believe pseudo-science and ad hominem arguments that supports their pre-existing belief. We saw this in the health care debate where health reform was labeled a government take over or with the claim that “Obama is coming to take our guns.” Or they will argue that a single weather event like a big snow in DC is evidence of global cooling. Another one is that glaciers are melting as a result of volcanoes under the ice. No explanation is too far out if supports existing convictions. One is reminded of Gregory House quote on religious arguments: "Rational arguments don't usually work on religious people. Otherwise, there would be no religious people. “

It’s now time to come back to the idea that (Federal) government size is the problem. One aspect of size is power and relative power is involved in relational problems between government and business. Rather than being isolated areas where one is good and the other bad, they are in practice intertwined via business-government interaction. This point is sometimes ironically made by noting that Republicans love the free market so much they in effect subsidize it by legislating government spending to that effect. A Washington Examiner article recently made this point in discusses a Virginia Economic Development Partnership of Henrico County & the Greater Richmond Partnership to secure 500 GE jobs. It would cost at least $2.6 million in state-controlled and taxpayer funds. The article notes the irony of small-government congressman Eric Cantor assisting happily with the project, while opposing stimulus via government hiring. To me such stance seem unreflective, and smells perhaps of hypocrisy. See http://washingtonexaminer.com/blogs/beltway-confidential/2011/04/cantor-mcdonnell-warner-pay-ge-replace-some-ge-jobs-it-killed

The size factor for either government or business affects how each treats citizens and how citizens relates back to them. When institutions grow large they can become intentionally or unintentionally insulated from parts of the larger society. Then to achieve their internally developed aims both business and government may become inappropriately involved in areas of people’s lives. If they are Big they have the power to do this despite opposition and indeed what on the face of it the spirit if not the letter of the law says. One thinks of post 9/11 Bush era initiatives like the so called Patriot Act for “security”. This turned out to involve NSA warrantless surveillance requiring cooperation between telecommunication companies and government to:

“monitor, without search warrants, phone calls, e-mails, Internet activity, text messaging, and other communication involving any party believed by the NSA to be outside the U.S., even if the other end of the communication lies within the U.S. http://en.wikipedia.org/wiki/NSA_warrantless_surveillance_controversy

On the face of it, such big gov-bus cooperation seemed to violate the social contract needed in a democratic republic – especially one that also calls itself a free enterprise/capitalist state. It may be driven by either side, but in reality, since both sides exercise power; they have developed ways of quietly sharing power. Often this is outside the view of ordinary citizens. To me crank denialists on the conservative side often to lack sufficient skeptical instincts and discipline to see the reality of this cooperation. An example of this is the growth in the size of government and deficit spending during the Reagan and both Bush administrations. Conservatives seem to see such “bad” growth only during Democratic administrations. This is remarkable blindness since conservative administrations have had a disproportionate influence on causing the debt and unemployment. Another thing that they seem to be blind to is the American political way of doing things, which involves well developed lobbying practices to help pass laws and influence government. When corporations lobby governments, their usual goal is to avoid regulation. During Jack Abramoff’s heyday this lobbying romance included hiring lobbyists and lawyers for vast sums. For example, Abramoff’s lobbying and PR firm was paid $45 million over 3 years by Indian tribes who he convinced needed his firm’s help:

“to block powerful forces both at home and in Washington who have designs on their money.”

Abramoff’s business-government hybrid efforts was big in an embarrassing way - throwing lavish parties for politicians, aides, journalists, and so on. It’s the way the system works but it’s not particularly a picture of FDR’s “big” government. Back then it was conventional, progressive wisdom that government action (when well designed) protects ordinary citizens by restraining big business. It needs to be big and powerful enough to do this. But conservatives seem to be blind to this reason for powerful government as they are to a large military being Big Government. And they don’t easily see the corrupting role of the wealthy on government moving us towards a form of managed democracy.

As businesses have become bigger the power needed to constraint them has grown. Historically that has been government, urged and supported by progressive movements. What we should understand about an appropriately big government is what the historian Arthur Schlesinger said of it:

"Liberalism in America [the progression of the welfare state and government intervention in the economy] has been ordinarily the movement on the part of the other sections of society to restrain the power of the business community."

But now neither pole of the dichotomy seems to effectively check the excesses of the other. Indeed they often compromise with each other. It’s as if we have become so used to the gov-bus game that each side knows how to check the other. All we can do is slide sideways in the struggle. This results in an unconscious race to the bottom.

We now are at another historical point where a rational balance of mutual constraint is imperative. Perhaps there is a different way to go. If so we need to find it fast since problems that need solving will not wait.