I have only started into Stockman’s “The Great Deformation” – it’s 750 pages long, for crissake – so I was pleased to find this critique to suggest a perspective from which to view his argument as I trudge the path to happy destiny.
The new book is as full a statement as you could wish of where that strong theory now stands. It turns out to be Ron Paul libertarianism, give or take. Stockman is both impressive and infuriating in just the same way as Paul. He makes valid criticisms of many policies, but his ideas form a sealed intellectual system. Everything depends on everything else. Things can’t be improved here and there. Suggesting palliatives is missing the point — the entire body politic is sick and has to go.
The fundamental problem, says Stockman, is easy money. Alan Greenspan’s low interest rates caused the bubble, hence the crash. Ben Bernanke’s low rates and quantitative easing are reinflating the bubble, hence the next crash (which will be worse). Cheap money obliterates the signals on which capitalism depends. Everything that’s bad in public affairs, from political corruption to explosive growth in public and private debt and the depredations of private-equity firms (like the one Stockman ran), follows from the Federal Reserve’s monetary indiscipline.
It’s a grave indictment of modern central banking and no laughing matter — even when you’re asked to read sentences like this: “During 2009-2012 the vultures feasted gluttonously in the Fed’s killing fields.”
The book describes an 80-year arc of fiscal and monetary recklessness. Dwight Eisenhower wins praise for fiscal solidity, but every other president was a knave. Stockman is nominally a Republican, but his party disgusts him as much as the Democratic Party. There’s no partisan rancor in the book: It’s sustained and intense, but entirely nonpartisan.
The author concludes,
The scope of the critique, while crazy, is undeniably impressive. It has a kind of logical integrity. Everything is worked out and all the connections explained. Stockman has been reading his economic history and his Austrian economics. Crucially, a lot of what he says really does make sense. In understanding the crash, for instance, the Austrian school’s emphasis on the role of the credit cycle looks right. Most of Stockman’s observations aboutWashington’s self-replicating morbidity are accurate.
Frustration arises mainly from the way this mode of analysis resists reform at the margin — the only kind of reform that can actually happen. This relieves Stockman, just as it relieves Paul, of the need to engage in government as we know it. Instead, they can contentedly contemplate our destruction from a great height.
It brings to mind the current flare up on these pages between the Scott Frantz approach – engaging in government, and that of my favorite bomb throwing, flaming haired
Solomon Samson some angry dude intent on bringing down the temple out of frustration and despair of achieving anything positive, ever. I absolutely don’t share Scott’s optimism, but I’d welcome the chance to be proved wrong: pessimistic nihilism is a lousy place to spend one’s life.