American Pie; White-collar crooks, dictatorships, and...

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JUNE 4, 2007

American Pie; White-collar crooks, dictatorships, and otherconservative causes.

I had thought that conservatives were taking the democratic outcomeof the 2006 elections rather well, all things considered. Then Iread a column by American Enterprise Institute (AEI) economistKevin Hassett, and now I'm not so sure. Hassett points out that,over the last decade and a half, free-market dictatorships hadfaster economic growth than free-market democracies. The obviousexplanation would be that dictatorships tend to be poorer countries(e. g., China) that can grow more quickly by catching up withmodern technology. But Hassett offers up a differentinterpretation: Unlike democracies, dictatorships "are nothamstrung by the preferences of voters for, say, a pervasivewelfare state." In other words, while Western democracies are heldback by voters--with their pesky demands that citizens get healthcare and old people not be left to starve in thestreets--autocracies march nobly toward a free-market paradise.

I suppose it's good that, in the wake of Iraq, AEI is rethinking itszealous commitment to forcibly exporting democracy across theplanet. But perhaps the think tank is now veering a bit too far inthe opposite direction. AEI's signature foreign policyneoconservatism was well-reflected in Karl Zinsmeister, the formereditor of its magazine, who was best-known for his celebration ofPresident Bush's foreign policy--"there is now no chance whatever ofthe U.S. losing this critical guerrilla war," he wrote of Iraq in2005--and for finding innovative but not entirely ethical ways toturn the publication into a vehicle for personal profit (asdetailed in James Kirchick's "The Enterprising American" in thelast issue of The New Republic).

Tellingly, AEI's magazine has abandoned the Zinsmeister model andrelaunched itself with a new name (The American) and a new mission("a magazine of ideas for business leaders"). The new editor, JamesGlassman (who was tnr's publisher from 1981 to 1984), is best-knownfor co-authoring, with Hassett, the kitschy stock market-utopiantract Dow 36,000. His most recent venture was running Tech CentralStation, a "think tank" owned by a lobbying firm whose clientswould find their views taken up in purportedly independent op-edswritten by Glassman and his minions. (This arrangement, alsoinnovative and also not entirely ethical, was aptly dubbed"journolobbying" by Nicholas Confessore in a 2003 WashingtonMonthly expose.) Mirroring the change in leadership, The Americannow seems less dewy-eyed about the virtues of democracy and far moredewy-eyed about the virtues of the bottom line. Out is theconservatism of Paul Wolfowitz. In is the conservatism ofMontgomery Burns.

In addition to Hassett's odd defense of dictatorships, the currentissue defends CEO pay, expresses skepticism about global warming,and denounces corporate democracy. University of Chicago economistsGary Becker (a Nobel Prize-winner) and Kevin Murphy contribute anessay titled "The Upside of Income Inequality." The upside I wasexpecting them to emphasize was that people with large incomes getvery, very rich. But I guess that part was taken as a given. Beckerand Murphy instead argue inequality has grown because "the labormarket is placing a greater emphasis on education." Education makespeople more productive; ergo, inequality is good.

It's true that the gap between college-educated andnon-collegeeducated workers has grown. But the big rise ininequality is not between workers with degrees and workers without.It's between the top 1 percent and everybody else. Wouldn't raisingtaxes a bit on the top 1 percent help alleviate inequality? Beckerand Murphy reply that, while a fairer tax code "may sound sensible,it is not," because it would amount to "a tax on going to college."So, if we raise the top tax rate, then 18-year-olds will choose tobecome convenience store clerks rather than go to college and runthe small risk that they'll one day get so rich that they couldface a slightly higher marginal tax rate?

But the issue's piece de resistance is a cover story pleading formore lenient treatment of white-collar criminals. In the "good olddays," author Luke Mullins reports, white-collar prisons allowedconvicts to order takeout from fancy restaurants, sneak away forgolf, and enjoy other trappings appropriate for men of their class.Alas, embarrassed by the "Club Fed" reputation, prison officialscracked down. Today, as Mullins's sympathetic subject tells us,white-collar prison is "a hellish place."

How hellish? I'll let Mullins pick up the description two paragraphslater: "Alongside the housing units and administrative buildingsare such amenities as a gym, a softball diamond, a bocce pitch, anda tennis court slipped inside an oval track. From the grounds,inmates gaze at the soft mountaintops that rim the horizon."

OK, that might not sound very hellish. But Mullins's point is that,while such punishment might sound rather lenient to the averageperson, it's unbearable for men accustomed to great wealth(ill-gotten though that wealth may be). "You've been giving ordersyour whole life," explains one advocate of more lenient conditions,"and now there's this buffoon with an IQ of twenty telling you toclean the toilet." Actually, this part isn't quite as bad as itsounds, either; as Mullins reveals two pages later, wealthyprisoners typically hire fellow cons to do such jobs for them. Butthere are other indignities-- they may no longer wear civilian garband can't spend more than $290 a month at the prison commissary.You try limiting yourself to that budget when you're used toshopping at Barney's.

Why would The American develop such a strong sympathy for thesuffering of white-collar criminals--especially when, like otherconservative organs, it generally ignores the far greater horrorsinflicted on regular prisoners? One might suspect this suddenconcern was inspired by the potential wave of coming Bushadministration indictments. But the real answer seems to be thatThe American sees the idea of rich criminals having an unpleasanttime in prison as yet another sign of egalitarianism run amok. "Asthe widening gap between high- and low-income Americans has becomea focus for politicians and journalists," laments Mullins,"arguments [for more lenient treatment] are unlikely to find muchsupport."

Ah, those irrational voters, hamstringing the government again. InChina, rich crooks can just buy their way out of trouble. No wonderwe're falling behind.

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