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"Polite totalitarianism," part one
"Polite totalitarianism," part three
"Polite totalitarianism," part four
 

From Vol. I, No. 2
of The Last Ditch (October 1994)

Polite totalitarianism
Part two

By RONALD N. NEFF

Though the underpinnings of any society are generally implicit, they may be detected in countless decisions made by both the ruled and the rulers. They are, as it were, the mute commandants of society. Control them, and you control the society. In the United States, the pivotal presuppositions in the political realm are that the government is uniquely virtuous in world history, and that while gentlemen may disagree about specifics, in general the expansion and overall purposes of this state are good and to be accepted, defended, and praised. Virtually every undertaking of the Permanent Regime tends to reinforce those presuppositions with the effect that subjects who embrace them — to the extent that they embrace them — pose no revolutionary threat.

Such presuppositions are inculcated most directly in the government-run schools and, less directly, through the established news media, the latter teaching us what is important and how we are to consider it, primarily by means of the subtleties of selecting topics and the slant they are given. For example, none of the 30-year retrospectives of John Kennedy's assassination examined this reaction of some citizens at the time: "Good!" We often saw film of weeping folks outside the hospital where he died, and we were solemnly and repeatedly informed of the nation's shock and grief. (One movie that is set in the period depicts a teenage girl running through the woods to her secret place of refuge to weep from despair at the news and to be comforted by a boyfriend who intuitively knew she'd be there.) But in fact, a good many Americans simply were not prostrate with grief and felt no loss, and it is not asking too much of a neutral news report to discuss that fact in a neutral manner. However, acknowledging such a response would have highlighted an important level of dissatisfaction with the government of the time, risking the possibility that some viewers might become curious about the legitimacy of that dissatisfaction.

I will be returning to the role of the media later; here I am more interested in how the Permanent Regime reinforces the presuppositions governing our thinking through the indirect means of manipulating our choices. There is nothing particularly new about the state's desire to direct human action with a minimal amount of police enforcement. What is historically unusual about the Permanent Regime is that its "indirect direction" affects not only how its subjects act, but how they will think about its engine, the state, as well.
 

Engineering incentives

One method the regimes of this state have used to redirect their subjects' thinking is the engineering of incentives. Naturally, one thinks of the jackboot and nightstick in that connection, but the state has at its disposal instruments whose implementation is much more polite. Being polite always reinforces the illusion of goodness and keeps those to be governed open to persuasion. [*] Even the illusion of politeness is preferable to unmistakable coercion. Thus, the term "voluntary" has been so corrupted in public discourse that the state's personnel could say without any sense of irony that wage and price controls were voluntary, or that the income tax system is based on voluntary compliance. Congressmen dare to threaten whole industries with regulation if they do not voluntarily regulate themselves in some particular; a recent victim is the recording industry, vaguely threatened with congressional action if it will not voluntarily print warnings on its packages.

But among attempts to engage the truly voluntary choices of the governed, tax incentives are surely the most effective. Their purpose is to direct the populace into taking certain favored courses and rejecting unfavored ones, and when people take certain of those courses, we can see their subjective opposition dissolve. That is, demonstrated and subjective preferences seem to become harmonized.

For example, under the guise of making taxation fairer and making "cheating" harder, the Reagan revision of the tax laws disallowed certain income tax deductions for parents unless they had obtained Social Security numbers for their small children. There was no requirement that children older than 2 have SSNs; there was merely a price to be paid if they lacked them. Far from protesting, the American public thronged to become eligible for those deductions. The state had created an incentive for its subjects to do voluntarily that which, historically, states have had to use the threat of force to accomplish.

The irony is that during the Carter regime, some in Congress recommended assigning SSNs to newborns as a means of addressing the burgeoning policy problem of illegal aliens. The proposal was rejected almost immediately because its transparent tyranny evoked so much protest. Less than 10 years later the transparent tyranny was occluded. Like the Carter-era proposal, the new tax measure had a semi-benign, reasonable cover, but unlike the earlier proposal there was nothing mandatory about it. It was enforced by the free choice of people trying merely to avoid what they saw as unnecessary expenditures. Thus, parents complied with the plan as certainly as if they had been commanded under threat of reprisal by the priests of Moloch, and the voices of opposition were silenced without a drop of blood's being spilled.
 

Narrowing the range of alternatives

Another favorite instrument is the narrowing of the range of alternatives, and it is used mostly against businesses through regulation and taxation. Recently the IRS regulations that define "subcontracting" have been tightened, so that businesses must be ever more judicious in making use of the services of self-employed consultants or temps. Of course, in some cases contractors cannot satisfy the regulations at all, resulting in a constricting of the population of independent subcontractors.

Similarly, and again under the pretext of closing tax loopholes and fighting tax fraud, the IRS is applying regulations regarding deductions for home office space more strictly. Thus, even as technological advances and the market free more people to work at home, either as employees of others or as self-employed entrepreneurs, the state places new obstacles in their paths.

Subjective feelings of independence — from the independent farmer's to the self-employed consultant's — are not illusory, and the Permanent Regime understands well that the fewer people who enjoy such a sense of independence, the more docile society as a whole becomes.

Moreover, there is the paradox that the farther the state can remove itself from its subjects, the easier they are to govern. Thus, a people tied to employers are easier to govern than a self-employed people for the simple reason that employers will always be less numerous and thus more visible than their employees. The state can then govern the employees indirectly through the employers, the number of subjects to be watched and regulated having been reduced. Further, merely by being employed, one must cultivate certain habits of mind of acquiescing to the demands or preferences of others, habits that are easily transferred to a larger, more formidable entity. Members of labor unions are twice removed from the state but are even more easily governed, for there are fewer unions than there are employers.

Yet another way to narrow alternatives is to make actions more costly. As that applies to economic activity, regulations primarily affect small businesses and marginal competitors of politically better-connected big businesses. And no matter what the regulation, to comply or even to go out of business is nearly always less costly than to oppose it. And once again the habit of acquiescence is cultivated.

At the same time the state makes being in business more costly, it holds out its generous hands in the form of Small Business Administration loans. It is not yet the case that everyone who would start his own business needs to get an SBA loan, but clearly we must expect the number of applications to increase. When nearly all small businesses are delivered by that midwife, viewing government as a business partner will have become universal. The significance of the state as a provider (or cartelizer) of capital is discussed in Strakon's analysis of the ruling class. ["Dark Suits and Red Guards," to be posted.]
 

Manipulating information

The Permanent Regime further engages in indirect manipulation of the thinking of its subjects through the established news media and the banking industry.

I shall cite three examples for the first:

(1) Young correspondents quickly learn that posing overly embarrassing questions at briefings at the Presidential Palace or elsewhere will result in not being called on, or perhaps in not being admitted to the briefings at all. If aspiring anchormen, editors, and Pulitzer-prize winners are to share in the special access to the powerful their elders enjoy, they must not become adversaries of the powerful. They learn to be gracious to transparent lies and even to repeat them, and to read the powerful so as to transmit their message to a waiting audience. They must cultivate the habit of respect, if not awe, for power, which habit is conveyed to us in what they write or in what they project on the screen. The press as adversary is a blatant falsehood, if we are referring to the established media. Their neatest trick is to make us think that by sniping at a president or at a candidate, they are somehow not a part of the ruling process.

(2) More and more, regimes test proposed courses of action by feeding information to the established media in the form of "leaks." Journalists who lead those stalking horses become, in effect, stable-hands for officialdom, performing tasks that would risk embarrassment for someone in government, but not for one ostensibly merely reporting something said or done.

(3) Finally, the established media cooperate in the careful timing of official announcements. Thus, regimes normally make announcements with important economic implications late on Fridays after the stock market closes, forestalling reaction. But the "predictive" stories we are accustomed to seeing before important events occur are often missing, as though the announcement takes the news industry by surprise. The established media — "to serve the public" or even "for reasons of state" — can afford to sit on such intimations as they may have, for it is not as though they will lose a story: the story does not end when it is broken. Regime mouthpieces will be sought after for weekend news-analysis shows to explain and justify new policies, for to whom will the established media turn for commentary and explanation? To the spokesmen of the new policy and their collaborators or to its critics? Even if critics are featured, they will of necessity be less well prepared to offer their criticisms than defenders will be to present their positions.

As for the banking industry — a true command post of any modern economy — the very point of the Federal Reserve is to manipulate the money supply in such a way as to indirectly direct the choices of the people who use it, i.e., everyone. But other arms of government manipulate money as well.

One of the explicit purposes of Richard Nixon's unilateral devaluation of the dollar was to drive up the price of imports, manipulating the average American's buying decisions. Each such decision was made freely, which is precisely the beauty of polite totalitarianism. No new bureaucracy was needed to issue permits to purchase imports; no import police force was created to made sure that Americans purchased fewer imports. The ruled took the desired actions on their own and retained the illusion of being politically and economically free.

A more important element of control, though, derives from the insight of the Austrian economists that prices are information, collected and compressed into numbers. Control of the money supply — whether by monetary or fiscal policy — implies an ability to manipulate prices, that is, to manipulate the information bits of the economy.

The Austrian economists normally use the verb "distort" in describing the effects of government's interference into the economy. They recognize that economic decisions made under the influence of that interference will be different from what they would have been had they been freely chosen and will in various senses be mistaken. I use the word "manipulate," however, because I am focusing on the fact that the state nevertheless manages to exercise some control over the outcome of the new choices. Although the Permanent Regime is not omniscient, and although its actions continue to have unforeseen consequences, it is also true that they have foreseen consequences, which are often enough the consequences it desired. Even the unforeseen consequences are normally fertile with opportunity for statist expansion.

Further, we must incorporate into our analysis the certainty that the managers of the economy learn from their mistakes and are becoming more skillful at manipulating that crucial information. For those who have recognized that ours is the Information Age, the power implicit in that ability is ominous. In manipulating prices, the Permanent Regime manipulates our knowledge of the activities of others, our knowledge of possibilities, our knowledge of the world, and the decisions we make based on that knowledge.

Posted November 15, 2007

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* Not incidentally, it also makes opponents appear to be boorish boobs out of touch with sophisticated practicalities.

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