Thursday, November 11, 2010

When the Patronage Has to Stop

Why is it that the old industrial mid-west, from Pennsylvania to Wisconsin, was the center of the lurch to the Republican Party in the recent mid-term elections? I have a theory on that.

Politics is the process of bribing the electorate. You offer them goodies in return for votes. In the old agricultural era, the only voters were the landlords, the descendants of the warrior class that conquered and occupied the land. Kings and princes had to keep the support of the landed aristocracy with privilege and gifts. The result was that the rich paid almost no taxes and the poor paid a lot.

In our modern era the opposite is true. Now we have the mass of the people voting and they demand patronage from the politicians in return for their vote. The social-democratic parties are the masters at this game.

But there is a problem. Patronage politics is not a stable self-correcting system. That's because the supporters are ravenous for rewards. So the politicians have to keep offering new bribes at every election, for the old bribes are not counted as bribes by their recipients but as their "rights."

What happens when the money runs out and the politicians can no longer keep the payments coming? You get the industrial mid-west.

The industrial mid-west was center of post-WWII unionized manufacturing. The idea was that prosperity was a combination of big manufacturing corporations, big labor unions, and government adjudicating between the two. The reality was that the big corporations promised enormous benefits to their employees through defined benefit pension plans and retiree health benefits that would be paid out of profits ten, twenty, thirty years in the future. Unfortunately when the future arrived there weren't any profits, or at least, not enough to provide the promised benefits. So now the big corporation, big union model lies in ruins. The patronage promised by the politicians, the lifetime employment, the fat pensions, all is vanished into air.

If you are a sensible, practical person, and all the promises of the politicians turn out to be so much hot air, then there is only one thing to do. You must move on, admit that your investment in the political patronage system was a failure, and start over. That is what the folks in the industrial mid-west have decided to do.

But that raises a question. Why haven't the voters of California and New York joined in? The answer is that the big-government patronage model is still working for them--just. But in ten years or so some presidential candidate will be talking to his rich supporters about the bitter clingers. Only this time they won't be the bitter clingers of western Pennsylvania, devastated by the hollowing out of unionized manufacturing. They will be the bitter clingers of the huge government sector that collapsed in the budget cuts of the 2010s.

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