The meltdown wasn’t caused by engineers but by the Soviet political system’s dogma.
Nothing enrages my family, friends and colleagues more than when I assert that contemporary US political divisions are the same as those since the beginning of recorded history: ideology, race, and religion, rather than (easily ignored) Trump tweets (or the political spin thereof). So I will proffer that his tweets were divisive in that they challenged Progressive Democratic beliefs regarding these factors, but neither should be accepted on faith if America is to avoid an economic meltdown.
Empires and State Religions
The Soviet System’s accomplishments from Stalin’s time – industrialization and WW II, urbanization, restoration and expansion of Imperial Russia, etc., and the space achievements under Khrushchev were so impressive that American intellectuals generally agreed with Khrushchev’s “we will bury you” right up to Chernobyl in 1986. The plant failed because the Soviet system of top-down authority and suppression of the truth forced operators to ignore the inevitable failure and instead follow orders that guaranteed a meltdown.
Gorbachev’s glasnost” (openness) and perestroika (restructuring) in response to the disaster removed the pillars of the Soviet system – adherence to beliefs given the status of religious dogma – causing it to collapse, something Austrian economists had considered inevitable. Russia restored the Orthodox Church, but without any historical political legacy based on individual sovereignty, it morphed into a kleptocratic autocracy and a return to Russian Imperialism and military aggression.
Whether or not China discovered America in 1421 (or had a greater Empire than the Incas) it was a mercantilist empire several centuries ahead of the British in scope, science and technology, requiring “tribute” (kowtow) in return for protection and trade. Religion wasn’t an obstacle to entrepreneurial capitalism until Mao replaced de fact religious freedom with communist ideology in the early 20th century. China’s economic liberalization begun in 1978, that eventually led to a flowering of entrepreneurship in China’s attempt to restore and expand its earlier mercantilist empire, was accompanied by some religious freedom. Had political liberalizations followed, China’s demographics – a population four and a half times that of the US – might have already buried us.
Churchill may not have saved the British empire in the world wars, but the Empire saved his little island nation. At its 1920 peak it controlled about a quarter of the world’s land mass and population. Britain is a protestant Christian nation, which most analysts conclude fosters property rights and capitalism. The Church of England seceded from the Roman Catholic Church to eliminate the sovereignty of the Pope common to European empires at the time. The British legacy of democratic government and individual freedom and responsibility, the cornerstone of a market economy (admittedly at times too crony and mercantilist) is the source of its economic success and that of its former colonies, including the United States.
Uniting church and state elevates political ideology to infallible dogma accepted on faith. The U.S. Founding Fathers, following Britain’s lead, founded a Christian nation that guaranteed individual freedom of religion but forbade the formal establishment of a state religion.
Progressivism: The Unofficial State Religion in the US
The U.S. was the most entrepreneurial capitalist economy worldwide during the century from the Civil War to the Great Society. Socialist historians trying to foment class warfare portrayed the “Robber Barons” as exploiters of labor, and the progressive movement was founded largely on this premise (doctrine). In fact, serious economic investigations have concluded that labor captures almost 98% of entrepreneurial value added. Nevertheless, Progressive goals morphed over time from less income inequality to state-enforced socialist equality. The current Pope generally agrees.
America, not unlike many countries, has a slavery legacy problem. Competitive enterprises have every incentive to discriminate based on productivity, but none to discriminate on the basis of race. Such discrimination embedded in the policies of the Democratic Party and Progressive ideology since their founding has been illegal since the 1960s. Starting with LBJ’s Great Society welfare state targeting blacks, living standards markedly improved, but black/white income inequality remains in the U.S as it does virtually everywhere, a reason why blacks everywhere emigrate to the US. Progressives accept the proposition that today’s differences are a consequence of systemic racism.
Beliefs are based on selective facts, distortions, political spin, political myth, indoctrination, repetition, and repression. I am a product of 8 years of Catholic indoctrination by the nuns at Sunday school repetitively chanting Church doctrine. In high school, the Jesuits lectured on “the miracle of the Church, 600 million true believers.” But the real miracle was that virtually none of the faithful could read the written doctrine or understand the language of Mass, still in ancient Latin until 1967. As with most religions, historical fact is difficult to verify (some question the historical basis for the Bible). I decided not to impose that indoctrination on my children. No regrets, as a half century of child abuse was condoned and covered up by the Church autocracy. Instead, they got progressive political indoctrination beginning in primary, secondary and ultimately higher education.
Conservatives believe that non-race factors are correlated with income and wealth differences and that the way to stop discrimination on the basis of race is to stop discriminating on the basis of race. Protestants, particularly evangelicals, continue to believe that America is a sufficiently meritorious society with opportunities for those who pursue them, but they also still believe in the Constitutional separation of church and state.
The Democratic party has adopted Progressivism as the de facto state religion, turning their beliefs into doctrine. The Biden Administration now actively promotes the Black Lives Matter movement that sees Marxism as the path to more specific reparations. While Progressives don’t promise martyrs, 70 virgins or eternal salvation, they do convey virtue and moral superiority over non-believers. While the price for infidelity isn’t death, it may well result in personal and professional persecution. Today’s progressives aren’t willing to be thrown to the lions like the early Christians: they are running the circus.
The Alarm Bells are Ringing
Today a cell phone is many times more powerful than the computers that supported the 1969 moon mission, but experts don’t believe today’s NASA could repeat the feat, and NASA is arguably one of the more productive bureaucracies. That should set off alarms. How is US state directed “investment” going to convince China to abandon control of the Taiwan Straits and South China Sea? A reliance on market capitalism multiples that of China’s is required to overcome their demographic advantage at economic dominance. Kowtowing is more realistic.
Expenditure, debt and deficit alarms have been ringing for decades. but Democrats are deep in their reveries, chanting “America is unfree and unfair,” “the election was totally free and fair,” “Trump is the devil incarnate” and “the January 6th insurrection was a sacrilege warranting eternal damnation.” Meanwhile, the order has been given to drain the cooling tanks.
Kevin Villani, Chief Economist at Freddie Mac from 1982 to 1985, has held senior government positions, has been affiliated with ten universities, and served as CFO and director of several companies. He recently published Occupy Pennsylvania Avenue on the political origins of the sub-prime lending bubble and aftermath.