Health Care continued….

In Part 1 of the health care dis­cus­sion I wrote: “Churchill con­sid­ered socialism—a far milder form than we know today—incompatible with human lib­er­ty, and sought a way of ame­lio­rat­ing the com­plaints of the poor (or rel­a­tive­ly poor) with­out con­fis­cat­ing the wealth of those who pro­duce it.” A read­er disagrees…

The social­ism that Churchill railed against was a far STRONGER ver­sion, with very high tax­es, and things like state con­trolled indus­try. He would have regard­ed the Democ­rats as “cen­ter-right,” com­pared to the social­ist par­ties of the 20th cen­tury, with their com­mit­ments to nation­alised indus­try and very high tax rates.

Many would say the British state, like the Amer­i­can, is much larg­er today in rela­tion to the pri­vate sec­tor than it was when Churchill retired. At the high tide of Labour social­ism, 1951, 20% of Britain’s econ­omy had been social­ized. Amer­i­can gov­ern­ment is spend­ing close to 25% of GDP, the nation­al debt equal to or exceed­ing GDP. Tax­es are high­er now than they were when Churchill retired. Is there any phase of mod­ern dai­ly life where we are not remind­ed of the per­va­sive influ­ences of government?

Socialism redefined

Nei­ther Britain nor Amer­i­ca prac­tices pure social­ism, in the sense of gov­ern­ment own­ing ALL means of pro­duc­tion, which is com­mon to com­mu­nist coun­tries. Even there it’s not com­plete. Chi­na calls its sys­tem “mar­ket social­ism,” what­ever that is. Creep­ing cap­i­tal­ism, perhaps?

The West’s prob­lem is creep­ing social­ism, which need not involve nation­al­ized indus­tries. It does not mat­ter who holds the title to a prop­erty, like an insur­ance com­pany; it mat­ters who gets to direct it.

Churchill argued that social­ism is like Nazism and com­mu­nism in being mate­ri­al­ist and dehu­man­iz­ing, explains Lar­ry Arnn:

In oper­a­tion, it is more mod­er­ate, at first. But it builds a bureau­cracy that becomes a weight in soci­ety; it becomes a new form of aris­toc­racy, he says explic­itly, worse than the old form.

A ques­tion Churchill had to face in his time was: if you are for the social safe­ty net, includ­ing health care, how do you pre­vent that from build­ing a soci­ety of ‘drones’ (his word), ulti­mately dom­i­nated by a bureau­cratic elite? The safe­ty net is good, nec­es­sary, and can be made to work. but social­ism destroys its work­ing because it sets out, in prin­ci­ple, to destroy and super­sede it.

* * *

Churchill answered that ques­tion in many ways: the social safe­ty net is sim­ple jus­tice; with­out it the “peo­ple will set their faces like flint against the mon­ey pow­er.”  A con­sti­tu­tion should pro­tect the peo­ple against this ten­dency. A con­sti­tu­tional arrange­ment begins with the prin­ci­ples of indi­vid­ual rights includ­ing prop­erty rights, self-respon­si­bil­i­ty, the sov­er­eignty of the cit­i­zen, and the com­pe­tence of the cit­i­zen to man­age his own needs (except in extra­or­di­nary cir­cum­stances) and the gov­er­nance of his country.

One may look at today’s bureau­cratic gov­ern­ment in light of these cri­te­ria. What is its prin­ci­ple? Does it in fact oper­ate to waste resources and to over­come the inde­pen­dence and sov­er­eignty of the people?

Churchill is not here to weigh these facts and make the judg­ments. We are. And we can learn from his criteria.

Statistics

I thank Kyle Mur­nen of Hills­dale Col­lege for the fol­low­ing research:

Accord­ing to the Eco­nom­ic and Social Research Cen­ter the Total Man­aged Expen­di­ture (aggre­gate UK pub­lic spend­ing derived from pub­lic accounts) was about 37% of GDP in 1955. (Note:  the chart is based on % nation­al income, but they clar­i­fy in the index that GDP is nation­al income in this doc­u­ment. There is a good chart on page 5 show­ing gov­ern­ment expen­di­ture dur­ing the 20th Century).

Accord­ing to the 2012 Trea­sury Report (page 65), Total Man­aged Expen­di­ture in the UK was 45.5% of GDP in 2011-2012. (They pre­dict decreas­es for 2012-13 and 2013-14, but we did not find offi­cial num­bers for these years).

Anoth­er source reports that  pubic spend­ing was 34.95% of GDP in 1955 and 42.7% of GDP in 2013.  The num­bers are a bit dif­fer­ent here. But both show an 8% growth of gov­ern­ment spend­ing in rela­tion to GDP since Churchill retired.