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Wealth & Poverty Review To Hell with Main Street?

It’s time to reassert the authority of we the people. Originally published at The American Mind

In times of trouble, Americans rally around a common cause. After Pearl Harbor, we liberated much of the world; during the Cold War, we sent a man to the moon. There was a shared sensibility that Americans were unified in pursuit of the highest ideals.

But after some shocks, this sense of unity proves short-lived — and shortsighted. After the tragedy of 9/11, a bipartisan coalition of political leaders led the nation into a disastrous war in Iraq and Afghanistan. After the Great Recession, the Bush and Obama administrations, brushing aside the concerns of Tea Party patriots and Occupy Wall Street demonstrators alike, orchestrated a historic bailout of the banks and automakers — while millions of American families paid the price.

We are currently in the middle of a similar ordeal. Playing into the public’s fear of a deadly pandemic, a bipartisan alliance of political leaders, disease modelers, and media figures has quickly rallied the public to the cause of restrictive shutdown orders and multitrillion-dollar bailouts, convincing voters to cede their authority to a ruling class of “data-driven experts” and “public health officials.” But as the shock subsides and the details of our new policies become clear, this bipartisan euphoria will vanish—and the public will wonder how it was duped again.

For all of the talk about “helping families” and providing “small business relief,” these new initiatives are poised not only to increase the power of the largest institutions — government, banks, and big corporations — but to do so at the expense of working families and small businesses. Unless policymakers quickly reverse course, they will risk destroying America’s founding ideals of self-governance and small-scale financial independence.

Bailouts, Shutdowns, and the Death of Main Street

Although much of the rhetoric surrounding the CARES Act has focused on “small business,” in reality the legislation has turned out primarily to benefit the largest businesses, which immediately secured $862 billion in direct assistance and tax cuts. Meanwhile, small businesses were left to fight over $349 billion in Paycheck Protection Program funding, which has been quickly depleted. Even for this program, medium-sized businesses and chains such as Ruth’s Chris and Potbelly were able to leverage their banking and finance connections to quickly process applications, leaving millions of small businesses, contractors, and freelancers behind.

The public quarantine orders have followed the same logic. In my small town in Washington State, the Safeway, Home Depot, and Target stores are open, but all of the small businesses that surround them are closed. In practice, the largest businesses have been able to rapidly deploy their lobbyists to state capitols, pressing anxious political leaders to bless them as “essential.” The smallest firms — nail salons, music stores, flooring companies — do not have the power, organization, or political infrastructure even to make their demands heard. They’ve been subordinated to the opaque science of “public health experts” and left to die.

Part of the problem is that the bureaucrats have no skin in the game. In Washington State, for example, unemployment has spiked to 28 percent in construction, 30 percent in accommodation and food services, and 35 percent in the arts, entertainment, and recreation. Meanwhile, new unemployment claims in the government sector have remained steady at less than 1 percent — lower than any industry statewide. For entrepreneurs and private sector workers who have watched their companies collapse, it is a bloodbath; for much of the public bureaucracy, it is a work-from-home vacation with little risk and little responsibility.

The Managerial Class Takes Control

Although the destruction of small business is a travesty, it is not a surprise. As James Burnham predicted during World War II in The Managerial Revolution, we entered a political era of control by a caste of “administrators, experts, directing engineers, production executives, propaganda specialists,”and “technocrats,” who together wield authority over small proprietors, capitalists, and politicians alike.

The managerial class resents and fears any major opposition. In the Trump era, it has scrambled to fight back against populists amplified by technology. Now, the coronavirus has handed the managerial class a golden opportunity to regain control. The disease hastens the decline of the old American ideal of small-scale financial independence. For centuries, Americans mythologized the family farmer; he now survives predominantly in pickup truck commercials. The small proprietor was supposed to be the replacement, but he, too, now seems on the verge of extinction. The virus will destroy millions of small businesses in the coming months. The largest firms and financial institutions, abetted by a political class that has abandoned the old ideals, will absorb their market share and move on — to the self-entitled relief of those who manage big money and big organizations.

The corporations appear unable survive on their own; the state appears uninterested taking them over directly. So, we are left with Burnham’s third way: rule by the managerial class. Political leaders across the country, eager to offload their responsibilities, have insisted that their policies will be governed by “public health experts,” “data,” and “science.” In New York, where the coronavirus has spread the furthest, the governor has announced that the management consulting firm McKinsey will create the plan to re-open the state — a near parody of rule by the managerial class. Burnham argued that neither capitalism nor socialism would ultimately prevail. As we survey this moment of the pandemic, there are signs he may be right.

The Reassertion of Politics and the American Ideal

But for how long? As Matthew J. Peterson has suggested, now is a time for statesmanship and the reassertion of politics. “Science cannot make political decisions. Data cannot make political decisions. The precautionary principle cannot make political decisions,” Peterson writes. “They require a synthesis of expert analysis and a balancing of options and their respective tradeoffs … Expertise can inform this kind of decision-making, but it can’t of itself resolve anything.”

Paradoxically, for all of his faults, President Trump might be the one political figure able to re-establish what Peterson calls “the authority of the American people and the American nation-state.” Rejecting the consensus of the managerial class, the president quickly closed the border with China, cut funding to the “experts” at the World Health Organization, and has insisted that re-opening the economy is within his own political authority.

The question now is on behalf of whom. Here, we must be less optimistic. Although citizens and small proprietors have started to flood state capitols chanting “let us work, let us work,” it might already be too late. The $2 trillion bailout package has been spent and any further assistance will follow its same imperatives. Some political leaders and public health officials are now suggesting that lockdowns might continue into the summer, which will destroy countless more “non-essential” small businesses.

The bitter irony is that in his promise to “Make American Great Again,” President Trump specifically appealed to the old ideals of citizen rule and small-scale financial independence. Unless he is able to assert control, carefully re-open the country, and ensure that the next round of CARES Act funding provides fast relief to every small business — every trucker, plumber, repair man, and hair stylist — he will be falling short of these ideals.

It’s time to reassert the authority of the American people. We must now say: to hell with the managerial class.

Christopher Rufo

Director, Center on Wealth, Poverty & Morality
Christopher Rufo is the director of the Discovery Institute’s Center on Wealth & Poverty. He has directed four documentaries for PBS, Netflix, and international television, including his latest film, America Lost, that tells the story of three "forgotten American cities.” Christopher is currently a contributing editor of City Journal, where he covers poverty, homelessness, addiction, crime, and other afflictions. Christopher is a magna cum laude graduate of Georgetown University, Claremont Institute Lincoln Fellow, and has appeared on NPR, CNN, ABC, CBS, HLN, and FOX News.