Opinion: Carolina Critic

No. 103: Sixteen-Trillion-Dollar Mistake: a Misguided Exercise in Socialism

Bruce S. Jansson: The Sixteen-Trillion-Dollar Mistake, Columbia University Press, 2001, 496pp., $27.50

The Sixteen-Trillion-Dollar Mistake by Bruce S. Jansson is an interesting, but fundamentally flawed, book. Those who share Jansson’s ideological position will find the book a treasure-trove of information to support their preconceptions. Most normal people, however, will be hard-pressed to wade through the tome’s biased pontificating and economic misconceptions.
Jansson starts out innocently enough, writing, “I began this research with the suspicion that Americans had made numerous errors in their national priorities from the presidencies of Franklin Roosevelt through Bill Clinton.” Virtually any well-read American can point to governmental blunders in the allocation of resources, and from the book’s title, you might surmise that the author is about to pitch into the tremendous waste that we have seen in federal farm subsidy programs, housing programs, welfare, education meddling and so forth. But no—Jansson is a professor of “Social Work” and his complaint is not with those familiar boondoggles. Instead, he is upset that our “national priorities” have not matched his utopian dreams.
In an interview distributed by publisher Columbia University Press, Jansson was asked, “How can a noneconomist, nonmilitary expert, nonbudget expert intelligently criticize budget decisions of various Presidents and Congresses?” to which he answered, “To the research and recommendations of these experts, I have added value judgments.” Politicians, it hardly need be said, are not “experts,” but Jansson’s “value judgments” are for the most part absurd, reflecting a socialistic mindset that uncritically accepts the efficacy of government to solve “social problems” and looks askance at free enterprise.
As a longtime taxpayer activist, I believe the money Americans earn should be theirs to do with as they choose. Jansson’s view is just the opposite: “Failed priorities stem from misguided tax rates at excessively low levels, thereby depleting the resources available for military or domestic programs.” He grumbles that “members of Congress have often curried favor with voters by cutting taxes, even though they needed money to address domestic or international needs.” In short, what Jansson gives us is the old Galbraithian argument that we are starving the public sector by leaving so much money in private hands. The sixteen trillion-dollar mistake, in the author’s mind, is that the government hasn’t grown far bigger than it is!
Reaching back into history, Jansson argues that FDR made a “mistake” in failing to raise taxes in order to adequately fund the New Deal. “Historians often portray the New Deal as mammoth,” he writes, “but it had relatively few resources.” Jansson here is entirely oblivious of the well-argued case that the New Deal was a great hindrance to the economy’s recovery.
Our author also echoes the jaded leftist cry that corporations are undertaxed. The problem here is that people who have studied the economics of taxation have generally concluded that the incidence of taxation doesn’t fall on corporations, but instead falls in various groups of people— customers, workers, and stockholders. Unfortunately, all of his research never brought him into contact with analysis that pulls the rug out from under his argument.
Higher taxes, Jansson argues, would give the government more revenues for all those programs that liberals hold sacred— Head Start, Medicare, welfare, foreign aid etc.—while not affecting productivity. He thinks it a myth that high taxes stifle the economy and lead to rising unemployment, but never comes to grips with arguments of serious economists that by siphoning resources out of the private sector, the government necessarily reduces its ability to employ people and produce goods and services. It never occurs to Jansson to compare the economic performance of high-tax and low-tax nations.
The military is a favorite whipping boy throughout the book. It’s true that the Pentagon doesn’t always spend funds wisely, but Jansson paints with an extremely broad brush. He claims, for instance, that the military buildup under President Reagan was completely unnecessary. Tell that to the Poles, Estonians, Hungarians and other eastern Europeans who would still be living behind the Iron Curtain if the military had remained at Carter-era quantity and quality. The Soviet Union would probably still be expanding rather than having imploded.
There is little to be learned from this feeble book except that limited government scholarship and basic economics still have not penetrated far into academia—especially schools of “social work.”

Dr. Donald Racheter is professor of political science at Central (Iowa) College and president of Public Interest Institute.