I do not mean to suggest, of course, that things would have been different under a Democratic Administration. Every year the Democratic national leadership demands that the federal government spend more than it is spending, and that Republicans propose to spend. And this year, several weeks before President Eisenhower submitted his 1961 budget, The Democratic National Advisory Council issued a manifesto calling for profligate spending increases in nearly every department of the federal government; the demands for increases in domestic spending alone could hardly cost less than $20 billion a year.
I do mean to say, however, that neither of our political parties has seriously faced up to the problem of government spending. The recommendations of the Hoover Commission which could save the taxpayer in the neighborhood of $7 billion a year have been largely ignored. Yet even these recommendations, dealing as they do for the most part with extravagance and waste, do not go to the heart of the problem. The root evil is that the government is engaged in activities in which it has no legitimate business. As long as the federal government acknowledges responsibility in a given social or economic field, its spending in that field cannot be substantially reduced. As long as the federal government acknowledges responsibility for education, for example, the amount of federal aid is bound to increase, at the very least, in direct proportion to the cost of supporting the nation’s schools. The only way to curtail spending substantially, is to eliminate the programs on which excess spending is consumed.
The government must begin to withdraw from a whole series of programs that are outside its constitutional mandate—from social welfare programs, education, public power, agriculture, public housing, urban renewal and all the other activities that can be better performed by lower levels of government or by private institutions or by individuals. I do not suggest that the federal government drop all of these programs overnight. But I do suggest that we establish, by law, a rigid timetable for a staged withdrawal. We might provide, for example, for a 10% spending reduction each year in all of the fields in which federal participation is undesirable. It is only through this kind of determined assault on the principle of unlimited government that American people will obtain relief from high taxes, and will start making progress toward regaining their freedom.
And let us, by all means, remember the nation’s interest in reducing taxes and spending. The need for “economic growth” that we hear so much about these days will be achieved, not by the government harnessing the nation’s economic forces, but by emancipating them. By reducing taxes and spending we will not only return to the individual the means with which he can assert his freedom and dignity, but also guarantee to the nation the economic strength that will always be its ultimate defense against foreign foes.
CHAPTER EIGHT
The Welfare State
Washington—The President estimated that the expenditures of the Department of Health, Education and Welfare in the fiscal year 1961 (including Social Security payments) would exceed $15,000,000,000. Thus the current results of New Deal legislation are Federal disbursements for human welfare in this country second only to national defense.
The New York Times, January 18, 1960, p. 1.
For many years it appeared that the principal domestic threat to our freedom was contained in the doctrines of Karl Marx. The collectivists—non-Communists as well as Communists—had adopted the Marxist objective of “socializing the means of production.” And so it seemed that if collectivization were imposed, it would take the form of a State owned and operated economy. I doubt whether this is the main threat any longer.
The collectivists have found, both in this country and in other industrialized nations of the West, that free enterprise has removed the economic and social conditions that might have made a class struggle possible. Mammoth productivity, wide distribution of wealth, high standards of living, the trade union movement—these and other factors have eliminated whatever incentive there might have been for the “proletariat” to rise up, peaceably or otherwise, and assume direct ownership of productive property. Significantly, the bankruptcy of doctrinaire Marxism has been expressly acknowledged by the Socialist Party of West Germany, and by the dominant faction of the Socialist Party of Great Britain. In this country the abandonment of the Marxist approach (outside the Communist Party, of course) is attested to by the negligible strength of the Socialist Party, and more tellingly perhaps, by the content of left wing literature and by the programs of left wing political organizations such as the Americans For Democratic Action.
The currently favored instrument of collectivization is the Welfare State. The collectivists have not abandoned their ultimate goal—to subordinate the individual to the State—but their strategy has changed. They have learned that Socialism can be achieved through Welfarism quite as well as through Nationalization. They understand that private property can be confiscated as effectively by taxation as by expropriating it. They understand that the individual can be put at the mercy of the State—not only by making the State his employer—but by divesting him of the means to provide for his personal needs and by giving the State the responsibility of caring for those needs from cradle to grave. Moreover, they have discovered—and here is the critical point—that Welfarism is much more compatible with the political processes of a democratic society. Nationalization ran into popular opposition, but the collectivists feel sure the Welfare State can be erected by the simple expedient of buying votes with promises of “free” federal benefits—“free” housing, “free” school aid, “free” hospitalization, “free” retirement pay and so on.... The correctness of this estimate can be seen from the portion of the federal budget that is now allocated to welfare, an amount second only to the cost of national defense.[3]