Americans have been drunk on the idea of “progress.” For a century. And the party is still going.
So what is progressivism? The best that can be said about progressivism is that it means faith in progress—faith that tomorrow will be better than today—faith that anything new must be better than everything that’s old.
That’s the spirit of progressivism. Or at least that’s how progressivism has been marketed to the American people for many decades.
The problem is that progressivism is anything but new. It’s old. And getting older by the day. The word “progress” is but political code for: more government control over people and private property.
Progressive policies today are not only old, they’re typically the same policies that failed long ago being re-packaged, re-marketed, and re-presented.
In terms of public policies, we’re not going forward. We’re going round and round and round in circles of progressive policy failures.
An example: In 1929 Congress created the Federal Farm Board. Progressive Herbert Hoover was President, and Congress was stacked with progressive Republicans and progressive Democrats.
The Federal Farm Board was an attempt to control prices and manage the supply and demand of an entire industry—farming—through regulations and taxpayer subsidies used by government bureaucrats to buy surplus farm produce.
It was a failure. Why? Because no one, not even government bureaucrats, are exempt from the universal, immutable laws of economics.
Throwing other people’s money in the form of subsidies at products no one wants to buy is a waste of capital. Subsidies do not produce goods that people want or need or value.
By definition, there’s not much demand for anything that requires subsidies. If there was great demand, or if a product or service was highly valued by others, it’d be the basis of a sustainable business simply by satisfying market demand.
Worse, subsidies incentivize those who produce surpluses of unwanted products to continue producing the same unwanted products, rather than changing their attention and efforts toward producing what others want, need, or otherwise value.
Government subsidies encourage people to produce what is being subsidized rather than producing what others find most helpful.
Fast forward to today. 2016. The United States Department of Agriculture just announced that it will subsidize the dairy industry by purchasing 11 million pounds of cheese from private inventories to assist American food banks and pantries.
Yep. 11 million pounds of cheese!
Just think this through: The USDA will use your tax money to purchase surplus cheese from food banks and pantries—cheese that’s just sitting there because no one wants it.
After the USDA buys it all, the food banks and pantries will then need…more cheese, right? So they’ll order more from cheese makers and the farmers who supply them with dairy products, right?
Let’s be clear: The problem the USDA is trying to solve is: too much cheese. Yet the USDA is subsidizing and incentivizing dairy farmers to produce: yet more cheese.
All that tax money—all that money that once was yours because you earned it through productive work!—is being used to subsidize the making of more cheese, when there’s already too much cheese.
All that money is not being invested in a profitable, private venture that creates real value by producing what other people want or need. Instead, it’s being used to subsidize what other people don’t want, don’t need, and don’t much value.
And, along the way, these subsidies make the price of cheese in your local grocery higher. Yes, cheese prices will go up. Why? Because the artificial demand in the form of subsidized purchases of cheese is going up. 11 millions pounds purchased in one day! That’s quite the spike in demand for cheese, yes?
Just as government subsidies were a waste of capital in 1929—a destruction of capital, really—so government subsidies remain a waste of capital in 2016. Government subsidies always go toward things people don’t much want or value, which is why government subsidies always are a destructive, waste of capital.
We Americans might think we’re progressive, yet we haven’t even begun to understand the universal, immutable laws of economics. Let’s change that. Let’s make real, actual progress.
Let’s begin by not making the same stupid mistakes repeatedly. Let’s not do in 2016 the same stupid things we did in 1929. Let the next item on our agenda for progress be: Learning the basics of economic reality. What have we to lose?