I have known Woody Brock since we were six years old, and he has recently published a thoughtful book, American Gridlock, Commonsense 101 Solutions to the Economic Crisis. Since he is neither bashful about his cognitive abilities nor modest in his ambition, he has subtitled his book, “Why the Right and the Left are Both Wrong.” In line with that aspiration, he takes on five of the most contentious and important issues of the day – issues, he argues, that now seem intractable because (1) the public conversation has become a “dialogue of the deaf” and (2) unbending ideologues “cherry pick” data which they use to fortify their intellectual redoubts. “Gotcha,” he writes, “has become the game of our times.”
Brock calls for a return to a rigorous logic in which win-win solutions are deduced from first premises. A discussion of this method is perhaps the most interesting part of the book. Over the next couple of posts I will briefly present each of the issues raised in Brock’s book.
The Deficit. Brock, a serious mathematician, engages in simple math to distinguish between “good” and “bad” deficits. There is a huge difference, he argues, between spending and investing: a government’s negative cash flow is not a deficit if the borrowed money is invested in human capital and infrastructure improvements that will earn a positive return in the future.
“We eclipse all other nations,” he writes, “spending a whopping 71% of GDP on consumption.” In doing so we have created what John Kenneth Galbraith predicted over 50 years ago: an Affluent Society of “private splendor and public squalor.”
Next up: Entitlements; Preventing Perfect Financial Storms; China and Bargaining Theory; Distributive Justice.