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Jeffrey Sachs: The Price of Civilization

New book lays bare our country’s inadequacies while honoring its can-do spirit

Photo: Wade Martzall, License: N/A, Created: 2011:06:01 21:50:19

Wade Martzall

Jeffrey Sachs

Photo: , License: N/A


The Price of Civilization

By Jeffrey Sachs

Random House, hardcover

Deep in Jeffrey Sachs’ The Price of Civilization, after some 250 pages, comes a tragic irony. “Yes,” Sachs writes, “the federal government is incompetent and corrupt—but we need more, not less, of it.”

Out of context, it’s a howler. But Sachs, a professor of health policy and management and director of the Earth Institute at Columbia University, has written a fact-filled, chart-laden paean to the hope and can-do spirit of America. Not so long ago, he writes, the government wasn’t corrupt and incompetent. We planned, then carried through. We spent more to solve the problems of poverty, and we taxed the rich more to pay for it. Those taxes are “the price we pay for civilization,” in Supreme Court Justice Oliver Wendell Holmes’ memorable phrase. This used to be consensus.

Then Ronald Reagan came along and, with plenty of help from well-heeled ideologues, the idea that “government is the problem” took root and crowded out the flowers of civil society. Each failure—of privatized government services, of high-stakes testing in grammar schools, of “trickle down” economics, and of basically every other project of what used to be called the New Right—was held up as proof of the proposition that everything government touches turns to crap. This, in turn, begat even more rabid adherence to the ideology, and drives for yet deeper cuts to welfare and taxes on the rich.

Sachs promises to illuminate a path out of this feedback loop. But the liberal reader searches in vain for the surefire solution, the political program, the strategy, that can lead American politics out of its self-reinforcing stupidity.

And perhaps it’s too much to ask that Sachs deliver on his promise. He’s a macroeconomist, not a political fixer. So the book becomes less a stirring call to arms or a strategic plan than a dense compilation of facts that matter—and that have been all but erased from the public debate. Consider:

Three million U.S. manufacturing jobs were lost between 1998 and 2004.

Google uses a tax dodge called the “Double Irish” to avoid taxes on billions of dollars of revenue.

Since 1980, the average compensation of the top 100 U.S. CEOs increased from 50 times the average worker’s salary to more than 700 times.

One could use the book to fight the nonsense declaimed by so-called “conservatives,” but they do not respect logic or facts. In a review for The Wall Street Journal, Paul Ryan, Republican congressman from Wisconsin and proud Ayn Rand acolyte, predictably trashed the book, but tellingly contrasted Sachs’ moral concerns with the maintenance of what Ryan described as “an economy that has unleashed unparalleled prosperity.”

Given that Ryan, chairman of the House Budget Committee, is widely considered a serious policy maker, it’s fair to ask Sachs what he thinks the prospects for change are.

“I think the U.S. is an especially complicated country to make change,” Sachs says by phone from a Chicago hotel room. “We’re big, diverse, very noisy, easily distracted.” But America has gone through reforms, in the 1890s progressive era, during the New Deal, and in the 1960s civil and human rights movement, Sachs says. “I think we’re ripe for that again.”

A large part of The Price of Civilization is dedicated to the idea of “mindfulness,” which can make it read like a squishy new-age pamphlet: “Mindfulness, taught Buddha, is one of the eight steps on the way to self awakening.” The idea that political transformation begins with consciousness raising is, of course, both truth and trope. Sachs goes into detail about how the Right has built a ubiquitous propaganda machine in service of its ideology, but does not suggest, let alone set out, plans for a left-leaning counterpart.

“My main solution for individuals is turn off the TV a little bit and get out and get re-engaged with the community and I do think that’s happening with the young people,” Sachs says.

Where Sachs does suggest direct solutions he differs from some other progressive thinkers. He castigates both political parties for running up the national debt and suggests reining it in sooner rather than later. This puts him in opposition to people like Paul Krugman, the Nobel-winning economist and New York Times columnist, who has pushed hard for more and better-targeted government spending to stimulate the economy, and James Galbraith, who has said that deficits really don’t matter—and won’t for quite a while.

“Given how hard it is to mobilize taxes in the U.S., I fear that larger debts and debt servicing will crowd out vital public services and investments in the coming years,” Sachs says. “If the debt/[gross domestic product] ratio rises to very high levels, say up to 100 percent of GDP or more, the macroeconomy can become destabilized by a loss of market confidence. We’re not there yet, but we do need to ensure that we don’t get there.”

Sachs also suggests a national education push, with at least half of all students graduating from a four-year, degree-granting college by the year 2020. This contrasts with a growing cadre of commentators who suggest that higher education is overrated and oversold in a world crammed with dodgy for-profit distance-learning academies and the fraudulent federal aid schemes for which they seem designed. Some, like Robert Borosage, president of the Institute for America’s Future, say a German-style industrial policy should be the main focus of American progressives. German workers—degreed or not—enjoy high pay and job security even in a globalized system that rewards managers for finding low-wage workers. In his book, Sachs tips his hat repeatedly to the Germans, but still maintains that college is a prosperity driver.

“Right now it is still the case there is a big gap of living standards between those with and those without a bachelor’s degree,” Sachs says in a followup e-mail. “I also believe we will be in an era of educational reform . . . even though we haven’t figured out how to make distance learning work as well as it is sometimes advertised. . . . I think that right now we have a skills problem.”

German workers are, on average, better educated than their U.S. counterparts. So perhaps it’s right to suggest education first, industrial policy second.

Sachs’ argument comes down to this question: What kind of country does the United States wish to be? As Sachs shows, the western European model, with its high taxes and social benefits, tends to create happier people generally and many fewer impoverished people. But the rich have to pay more. The other model—Sachs doesn’t name it but let’s call it the Banana Republic model—finds a tiny elite enjoying vast wealth and power, with nearly everyone else struggling.

The time for choosing sides is now, it appears. Sachs endorses Occupy Wall Street. “I think they’re on to something very real,” Sachs says. But where we go from here remains anyone’s guess.

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