Charles Murray: In our hands: A plan to replace the welfare state

By Reviewed by Andrew Ferguson

Harebrained may not be the first word that comes to mind when you hear about In Our Hands, Charles Murray's new book. "Crazy" might come first, or maybe the more idiomatic "crackers".

But then you start to read it, and the word that pops into your mind is "Hmmmmm," which of course isn't technically a word at all.

Murray, a scholar at the American Enterprise Institute in Washington, has made himself famous as a provocateur - a social scientist and activist who plants his flag at the furthest edges of the contemporary debate and then waits for everyone else to join him.

It takes a while, but often they do. Losing Ground, his book on the failures of the US welfare system, was considered scandalous when it was published in 1984. Twelve years later it served as the basis for the welfare reform signed by President Bill Clinton.

In Our Hands is an attempt to leapfrog today's political argument about the size of government. The idea he offers is so unexpected and radically comprehensive that it could force both sides to question their own presuppositions. But first they have to read the book.

Murray says his idea - which he rather pompously calls the Plan, with a capital "p" - is a "thought experiment". This requires restraint on the part of his audience, since we're supposed to suspend judgment about the political plausibility of the idea until we've fairly assessed its merits.

The plan (I'm not using the upper case) comes in two parts.

First, Murray proposes to do away with all government transfer payments, including such social welfare programs as Medicare and Social Security, with agricultural and corporate subsidies.

This much should be expected, I suppose, from the author of Why I Am a Libertarian.

But wait. Then comes the second part.

Murray proposes a radical, and completely un-libertarian, redistribution of wealth. All the money that now funds the nation's welfare programmes (social and corporate) would be returned in the form of a $10,000 annual cash payment to every American over the age of 21.

The cash grant would be tax-free for anyone earning $25,000 or less. But no one, regardless of income, would have more than $5000 of his grant taxed away.

Murray has crunched the numbers. Because the cost of the plan would accelerate more slowly than the rapidly increasing cost of the current system, by 2020 it would total $549 billion less than the status quo.

This calculation excludes the transition costs of moving from the old system to the new - but that's one of those practical details about which we're supposed to suspend judgment. (You can see why social scientists like thought experiments.)

For now, however, the real value of Murray's idea lies in contemplating what, in theory, it could accomplish and how. On its own terms, the failure of the present welfare state is undeniable: despite a nation that grows richer each year, and each year allocates more money for the eradication of poverty, poverty persists.

Murray's plan doesn't try to decrease the amount of money devoted to alleviating poverty - the usual libertarian goal.

Instead it disentangles that money from the filter of bureaucracy and places it directly into the hands of the poor themselves.

Portions of the grant would be required to go to health insurance and retirement savings. Even with these restrictions, a father who works full-time for the minimum wage and a mother who stays home to care for a child would have an income 38 per cent above the poverty line.

Beyond that, Murray writes, "the Plan says just one thing to people who have never had reason to believe it before: 'Your future is in your hands'."

To advocates of the welfare state, of course, that sounds a lot like "you're on your own".

Not so, says Murray. His larger goal is to revive those social institutions, particularly the family, the workplace and the local community, which the welfare state has weakened and supplanted and "through which people live satisfying lives".

If you want to see the enervating effects of the all-encompassing welfare state, he says, look at Europe, where marriage and birth rates have plunged and work and religion have lost their traditional standing as sources of happiness and personal satisfaction.

In Europe, he says with evident disdain, "the purpose of life is to while away the time as pleasantly as possible".

Here the reader of In Our Hands may suddenly pull up short. What began as a wonkish policy tract enlarges into an exploration of how people live lives of meaning and purpose.

Who knew? It turns out that Charles Murray, America's foremost libertarian philosopher, is a moralist. In the end, though, moralising and libertarianism make for an uncomfortable fit.

On the one hand, Murray says he wants to liberate citizens from the welfare state so they can live life however they choose.

On the other hand, by liberating citizens from the welfare state, he hopes to force them back into lives of traditional bourgeois virtue.

It's a circle that Murray can't quite square, but it's fun watching him try. Above all, he deserves credit for thinking his way past the increasingly tiresome debate about "big government" - even at the risk of being thought harebrained.

* Andrew Ferguson is a columnist for Bloomberg News. In 1992, he wrote speeches for President George H. W. Bush.

* Published by American Enterprise Institute Press

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