Chocolate for Thought

 

There is a pervasive feeling among thinking people that this country is not just facing a severe economic crisis but that we are losing something exceptional. That something is American exceptionalism precisely. Lech Walesa, the blue-collar hero of Polish freedom from communism put it well in a recent piece in the Wall Street Journal. There is only one of America and if it ceases being itself, the world is left in the dark, goes the thinking. It’s not reasonable to count on the debt-ridden government pension-sucking Europeans to hold up the flashlight. The fact is that several European countries are disappearing because they don’t make enough babies to replenish themselves. That’s the ultimate form of pessimism. (And no, this is not a racist statement, I am completely pleased with the fact that brown-skinned Mexicans and their children are keeping the American population growing. They make good immigrants. See my article on Mexican immigration, with Nikiforov, in the Summer 2009 issue of the Independent Review.)

Unfortunately, there is an innate humility among Americans which makes it difficult for them to think aloud about American exceptionalism. If there were not, twenty years of cultural relativism in the schools would make the very thought difficult to formulate: “Everybody is equal. We are not any better than those who suck their grandmothers’ brain – but only after they die, or than those who practice horrendous sexual mutilation on little girls, or than those who still practice slavery. Only American slavery was atrocious. Slavery in exotic locales is kind of nice, actually, if you look at it in its proper cultural context.”

One way to overcome this shyness and diffuse sense of equality in order better to grasp what we are losing is to consider Swiss exceptionalism about which no one gives a damn, not even the Swiss. It turns out that in the main respects, there is not one America, there are several. Switzerland is one.

Contrary to a widespread impression, Americans probably don’t have the highest standard of living in the world. I will use Gross Domestic Product per capita (GDP/cap) to discuss this matter further. It’s simply the total value of the goods of all kinds produced in one country in one year divided by the number of population. If you care to look, you will find out why GDP/cap is not a good measure of anything because, blah, blah, blah. Or, you can simply trust, for the time being, my assertion that it’s a fine measure for our limited purpose of illustrating the standard of living in similar countries with fairly large economies. (Check my credentials to discuss such matters if you wish. Go through my vita, linked to this blog, and then, through Google. Go ahead, every time someone Googles me, I get a shiver up my leg, like Chris Matthew of MSNBC when he thinks of Barack Obama.)

The GDP per capita I am using is computed “PPP,” Purchasing Power Parity; it take into account different costs in different countries. So, it can be used to compare what ordinary people can really buy, at home, with their share of GDP. It compares what’s comparable. In this essay, I am only referring specifically to advanced developed countries. A short walk in any street of any town of any country I mention by name would persuade you that I am comparing what’s comparable. Those countries are not identical but they are similar. Americans have larger cars than the French but the French enjoy longer vacations, as do the Germans. The Swiss have smaller cars than Americans and shorter vacations than the French or the Germans but, in their country, just about everything works, which is more than we, or the French, can say.

For 2009 Luxembourg’s GDP/cap was above $77,000 and Norway’s above $59,000 while the US ranked 10th at $46,600. Switzerland ranked 18th at $41,600 By way of comparison the mean for the whole European Union was $32,700 . France stood at about that level. (All of the above figures are from the CIA World Factbook, available on-line, consulted 2/16/10.) For 2009, in raw terms, the French were thus collectively about 20% poorer than the Swiss. If you had made the comparison ten years ago, the French would have fared worse in comparison with the Swiss and the Swiss much better in comparison with Americans.

Luxembourg is really rich in every sense of the term plus it’s a fiscal paradise which makes comparisons difficult. Norway possesses important petroleum resources that are well administered and whose proceeds are well distributed. The other seven countries that rank above the US are oil sheikdoms or very small, which also makes comparisons difficult. The US has over 303 million people, France has 56 million, and Switzerland only about 7,5 million people. The point I want to make is that the Swiss are richer than about 95% of all people in the world or more and, more importantly, that they are richer on average than the French, right next door.

Switzerland is also smaller than France on every dimension. It has a small internal, domestic market. It’s not part of the huge European Union market, unlike France. (It does have a limited free trade agreement with the EU) Its climate is similar to that of France. Unlike France, Switzerland has almost no natural resources aside from expensive hydroelectric power. The Swiss are not even obviously better educated than the French. They spend the same % of their GDP on education as the French. That’s more in absolute terms since the Swiss GDP is higher. But France has obviously more top-notch schools at the university level than its neighbor. Contrary to a widespread impression, Switzerland is not primarily a financial country either. Its service sector, which would include finance, is proportionately smaller than that of France. It’s also smaller than the German and the American service sectors. If anything, Switzerland is a more industrial country – in the conventional sense – than France, and Germany, and the US. The usual common-sense explanations for the Swiss superiority in general don’t match well the Swiss reality.

For reasons I can’t go into here, many people like “cultural” explanations of socio-economic phenomena. Most of the people with such preferences don’t really know what they mean by culture. Yet, by any definition, language should be included under “culture.” With three and a half official languages, it’s difficult to argue that Switzerland has a distinctive culture. (It’s not impossible but it’s far-fetched.- Do you know what the fourth language, the one I call “half” is called?)

So, what does Switzerland have that France, and its neighbors, and most poor countries don’t have?

The answer is not about what it has but about what it does not have. Switzerland has little government. It applies with great rigor the principle of subsidiarity – which is also implicit i the US Constitution. Whatever concerns the village or town is decided at that level. What cannot be is decided at the canton level. Very few decisions ever reach the central, federal government. The Swiss central government is so small, you hardly every hear about it. The country’s President, unlike the French President (or the German Chancellor) is hardly ever on television because she has little to say that would matter to her citizens.

Correspondingly the weight of taxation is less in Switzerland than it is in France, not a little less but much less: It’s at 30% of GDP (like in pre-Obama America) against 46% in France. Now, let’s run this into real numbers, Suppose there were a political earthquake and the French taxation rate were reduced to Swiss levels. This means that in the first year, each French man, woman and baby, on average, would have about $5,000 to invest, to pay toward a car, or to buy more health insurance. What do you think this would do for the French economic growth rate?

To summarize: The Swiss federal government does not suck the substance out of its citizens and it’s too small to prevent them from doing whatever they want to do. The Swiss strive more than their neighbors who are in every way in similar circumstances and they thrive more. Does anyone think this is a coincidence?

Here the story ends. Until now, the US has been in most respects (including taxes) like tiny Switzerland. The Obama administration and its mad mentors in Congress want us to become like France.

As you ruminate these simple facts  also think of this: The giant food multinational firm, Nestlé, is a Swiss firm. Anyone who has no cocoa, no sugar and no milk to speak of, and who can sell chocolate to the world knows something worth knowing.

About jacquesdelacroix

I am a sociologist, a short-story writer, and a blogger (Facts Matter and Notes On Liberty) in Santa Cruz, California.
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14 Responses to Chocolate for Thought

  1. Maya says:

    Could you get this into the Santa Cruz Sentinel? You could succeed in opening the eyes of many young adults who are blinded by the liberal ideologies of SC and the media. This mini-essay is smart, concise, and simple to understand. I really liked this one.

    • jacquesdelacroix says:

      Full disclosure: Maya is my daughter. The older she gets, the higher my IQ.
      Maya: Thanks for the flattery. I know how I appreciated flattery in general, and n particular. The Santa Cruz Sentinel does a good job overall but it operates with all the condescension you would expect from a very small town newspaper with a monopoly. I also suspect it operates according to a quota system for non-conforming, non-liberal opinion. I don’t know this for a fact; I would love to be corrected. So, I don’t want to tangle with them in competition with a hundred babas. You, however, are welcome to act as my agent in this respect and in any other. Go ahead, submit in my name, or an other, and collect the e-mails. If you tell me to do X, Y and Z to help, you know I will do it with extraordinary promptness.

      BY the way, I exttend this offer to any other readers who care to act.

  2. Terry Amburgey says:

    “For reasons I can’t go into here, many people like “cultural” explanations of socio-economic phenomena. Most of the people with such preferences don’t really know what they mean by culture. Yet, by any definition, language should be included under “culture.” With three and a half official languages, it’s difficult to argue that Switzerland has a distinctive culture. (It’s not impossible but it’s far-fetched.- Do you know what the fourth language, the one I call “half” is called?)”
    You’re behind the times guy. When I teach International Business, language is part of culture, especially with regard to high-context and low-context languages. But alas only 1 session can be devoted to culture, we have other topics to consider; why economic comparisons have to be based on purchasing power parity for example🙂
    I think you put too much emphasis on national culture. Here’s a thought experiment for you (I know that you’re much too lazy for anything other than a thought experiment). Imagine a week in Santa Clara, a week in Biloxi Missisippi, a week in Bronson Kansas and a week in Brooklyn New York. Are these all really part of a national culture?

    • jacquesdelacroix says:

      Terry: I am not behind the time in terms of what I know at all. I am ahead of the time in that respect I think, I would think (with all due respect). There are many textbooks today, in international business, that don’t seem to assume that language is part of culture. I did not make that up. Reach out to any ten, you will see that eight do that. I too would like to throw away the textbooks. I never assigned one the last ten years I was teaching. But bad textbooks are a fact, of life, like rampant VD in the lower clergy! I can’t assume them away when I address my largely unknwon readers.

      I don’t know if I put too much emphasis on national cultures, As compared to what? In the piece of reference above, it’s appropriate, even required to discuss national culture. My chosen topic is what requires it. This treatment includes no statement (zero) about the relative importance of cultures pertaining to different kinds of groups (broadly defined). Of course, my coffee shop group also has a culture. I have done nothing that I know of that looks like ranking in order of importance, national culture and my coffee shop group culture or any other group’s culture.

      Maybe I am reading into what you are saying an old social-science rejection of the idea of national cultures as being too dangerously close to stereotypes. I hope that’s not what you are doing. That position is untenable. Another day, another topic.

      I may well be barking up the wrong tree, but there is a kind of knee-jerk social science liberalism under which both of us grew up that I want to do my best to reject dramatically before I die. I feel much remorse for my past passivity in this respect.

  3. Terry Amburgey says:

    “It turns out that in the main respects, there is not one America, there are several. Switzerland is one.” I guess what I’m saying is that while the direction you take here is well done, there is a ‘road not followed’. That road would say that there is not one America there are several. The southern atlantic states are one, the upper midwest is another, and there are several more. As an academic gypsy I’ve lived and worked in some dramatically different Americas. So have you. While there is a national culture in the US there is huge intra-group variance. The economic comparisons you make between countries have parallels between regions in the US. Why am I harping on this? Firms making foreign direct investment decisions don’t invest in countries they invest in specific locations…with specific local cultures, specific local labor markets, etc. etc.
    If you’d taken this road as well, the essay wouldn’t have been as tight, but hey when have reviewers and critics ever been fair?🙂

    • jacquesdelacroix says:

      Terry: You are off on a completely different trip, also a meritorious one to be sure.

      My theme was this: The US is not the only nation-sate with respectable institutions; there are others such as Switzerland, Finland, etc not to forget the UK, and even Canada. So the idea of American exceptionalism – dear to conservatives – should not be taken exactly literally. Rather, there are respectable countries and others that aren’t . My main measuring device for respectability is old- fashioned human rights.

      So, this was not the beginning of a disquisition of American regionalism.So, there is no road not taken. Be my guest!

  4. Pingback: Chocolate for Thought « Notes On Liberty

  5. Ranu Gupta says:

    Thank you for sharing, Captain. Like many of your pieces, it is a pretty good read and makes a sound case for smaller government. And then you may ask, as to why I do not support the GOP. And the answer is (drumroll🙂 )…

    Unfortunately, I have come to believe two very negative narratives about the GOP, based on statements put out by some GOP and Tea Party leaders, and what I hear from some commentators on Fox News.

    Narrative 1 – GOP is the party for the super Rich and the super Stupid:
    While there are many reasons I can share to support this assertion, I think the most obvious and undeniable is when one looks at political demographic maps. Republican base tends to be typically more dense in ultra-rich neighborhoods and in rural counties where education levels tend to be lower. Many Fox News hosts / contributors(not all) rampantly insult our intelligence by making obviously absurd statements and obsessing over silly issues. As an example, I don’t see how obsessing over Obama’s birth certificate or diplomas was ever a legitimate issue, if it wasn’t for any of the 43 Presidents that went before him. But obviously the simple minded viewership lapped up the propoganda put out by the super rich (Trump, Rove, Limbaugh et al).

    JD speaking : I will bet you fifty dollars right now, to go to your favorite charity, that you cannot produce a single instance of a Fox employee propagating the birth issue in any way;shape or form. If you take the bet bet, I will give you two months. Ranu: You believe fairy tales. No one induced you to make this false statement, you chose it.

    Narrative 2 – GOP agenda is dominated by bigots and racists:
    GOP is at times condescending about women’s issues and I believe that a not too insignificant part of the GOP tends to be racist (some knowingly and some unknowingly). GOP senate candidates make downright stupid comments about “rape” and then try tooth and nail to defend it. As to racism, there are far too many reasons for me to go into here, but we can always have a separate side discussion about it. So, even if I may otherwise completely agree with the GOP agenda of small government, I am terrified of giving anyone the slightest power over me who may knowingly or unknowing be inclined to think less of me because of my race.

    JD speaking again: Let me summarize: This long-standing member of the Republican Party (myself) is an ultra rich, very stupid bigot. Or else, he has been deceived by super-rich, super-stupid bigots and he does not even know it.

    Do you see anything wrong with either short narrative?

    Do you realize that the Republican candidates received the votes of about 50% of those who voted? Is this fact compatible with your description of the Republican Party? Is it the case that about half of Americans who bother to vote are either very rich, very stupid and bigots or else, that they are the fools of such? And, if you believe this, what does this say about democracy? How can you even take the risk to have the people of your description win? Do you think it might be better to have a council of wise men govern the country?

    • Ranu Gupta says:

      Here is what I see as the problem, Professor. Unfortunately I think and suspect there are very few Conservative idealogues and intellectuals of your calber that subscribe and speak on behalf of the GOP or are atleast able to make their voices heard. Unfortunately I suspect you may have become the minority voice in the GOP movement which seems to have gotten drowned out by the loud lumpen voices of its fringes. For instance I donot believe Governor Romney represented any of these stereotypes and therefore was able to strike a chord among independent voters, but I also believe for that same reason he may have been punished by a lower than expected turnout of his own base at the elections. I think what has been missing is an ideological narrative that represents the core of the republican party, a la Ayn Rand.

      As to the above, I think I may have overstated the narrative using too strong a set of words. And for that I apologize and thank you for calling out my hypocrisy. I think I maybe overgeneralizing a stereotype that reflects only a small section of self appointed and loud spokespeople. Irrespective they end up getting a lot of undue attention and end up tainting/ creating the perception for the whole party. To that end, for evidence I would ask you only to look at how the minorities and women voted in this election. As a champion of facts, I am sure you would agree that data does support some of the stereotypes I have highlighted that have rightly or wrongly come to plague the GOP in recent years. Else how would you explain the 70%+ Latinos and Asian americans known for their entrepreneurship voting for “big government” Obama over “free enterprise” Romney.

      I think this is a good time for the GOP to be taking a long hard look in the mirror, face facts and re-invent itself guided by its ideological core of free enterprise, a fundamental tenet of which is equal opportunity. All of this I think Mitt Romney represented, but I do not believe he lost this election on ideology. His message of “Jobs” resonated with many Obama supporters like myself, but what failed him was his party and what it has come to represent in recent years. Net, net what I am saying is Romney wasn’t undone by Democrats, he was undone by his own party.

      • Gupta (formerly Emperor of India): I don’t have big quarrels with what you write now, after thinking. Much of it is anticipated in my post: “The Disaster…” you seem not to have read. (OK, no exam!)

        Your impression that I am the sole rational narrator for the GOP is a little bit wrong, just a little. Have you heard of the Wall Street Journal? (OK, that was sarcastic; I am very ashamed.) Have you heard of the Weekly Standard? (I could find you an old issue if you were interested.)

        The truth is that under our system both major parties are uneasy coalitions of groups that don’t necessarily agree or even like each other. (I tried to touch on this in “The Disaster….”)

        Thus, the Democratic Party houses grossly overpaid union thugs and thugish unions, masses of African-Americans who joyfully agree to submit to sodomy every four years for no or little pay, effeminate university professors who don’t have the gonads to admit that they are gay, bitter, aging 70s feminists who can’t stand the fact that they mostly won, professional Jews who are satisfied to sacrifice their Israeli cousins out of sheer stubbornness, large numbers of hereditary Democrats who have never given it a thought, and finally, millions of young people who have never read a book or even held one. (I had better stop here; there might be some of the latter in my family.) And yet, the Democrat Party won the presidential, not by much, if you read the returns, but win it did.

        I am glad you did not take up my offer of a bet. It would have exposed the fact that you are quite under-informed and that you took the name of Fox News in vain. By the way, did you ever watch Fox News? Ever?

        There is no more scary witches than the witches we conjure up ourselves.

  6. ranugupta1 says:

    I know you well enough, Captain, not to take you up on a bet:) I do watch Fox News, in particular, The Five, Greta, Bill O’Reilly and Sean Hannity. Of these I find Bill O’Reilly relatively more credible. I miss Glenn Beck, though. I used to find him immensely entertaining! r

    • So, if you watch Fox News (I believe you) where did you ever get the idea that the chain pushed the birth issue?

      Here is a remark about style, liberals’ common style: Why does condescension comes so easily to liberals, it seems? Correct me if I am mistaken. If I am not, why would you be condescending toward Beck. Is it not the case that the man is better read, more cultured than you? (than me too, by the way). I hope my question is clear: I am not asking why you did not find him credible but why you used the word “entertaining.”

  7. ranugupta1 says:

    Yes you are right. He is probably better read, but with limited information I will reserve my thoughts on “more cultured”. I never paid serious heed to his content but I found his dramatic / theatrical style entertaining.

    On a related but slightly (only slightly:)) tongue in cheek note, can I ask if you think poorly of any Fox News commentator? You could ask me the same in an MSNBC context and I would say it wasn’t a bad idea to get Keith Olberman’s hate commentary off the air.

  8. Ranu Gupta says:

    Captain,
    Thought you might like this. This is Meghan McCain (Senator John McCain’s) daughter and a young Republican echoing similar sentiments:) best, r
    http://www.thedailybeast.com/articles/2012/11/16/meghan-mccain-on-why-the-republican-party-needs-to-wake-up.html

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