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Jim Manzi’s High-Tech Heresy

Jim Manzi could almost be described as a conservative theologian. He made his fortune wrangling software, but now he’s a contributing editor of National Review, the brainchild of the late William F. Buckley that has become, as Buckley intended, the intellectual voice of American conservatism. Manzi’s also a senior fellow at the Manhattan Institute, a conservative think tank that so far remains stubbornly tethered to fact-based reality while the Republican Party drifts farther from it every day.

Manzi’s bona fides as a conservative make him an outlier in the world of high tech. He seems to have resisted the liberal conspiracy that everybody knows twists the impressionable minds of American college students. His connection with National Review was probably begun with a job as research assistant to Mr. Buckley.

All of this is context to Manzi’s influential essay in the latest issue of National Affairs, titled “The New American System.” While those on the left attribute American riches to the theft of Indian land and African labor at a time when land and labor were the twin pillars of wealth creation, Manzi credits “an almost ruthless pragmatism” in public policy. Almost?

Students of history understand that the left and right narratives are both correct to the extent neither crowds out the other, and this is where Manzi’s stubborn tether to fact-based reality leads him to advocate “decisive government investments in infrastructure, human capital, and new technologies.”

Those of us who have always understood that government cash seeded steamboats, canals, railroads, civil aviation, interstate highways, the Internet—the list could go on---are not surprised.

Those of us who dream of tribal governments functioning as governments rather than mere social clubs that give voice to legitimate historical grievances understand that those investments are no less necessary on Indian land, whether the capital is acquired from outside investment or by taxing what little we have to tax.

Sovereignty cannot be exercised from a condition of dependence, and the conservative thinker Jim Manzi points the way to independence of Indian nations as much as the way forward for the United States at a time when the economy has been stagnating.

Let’s look at Manzi’s governmental desiderata from the perspective of both colonial and tribal governments, starting with human capital.

For the US government, the major issue begins with the grief that began, like most US economic grief, in what we call the Reagan Revolution, the vast redistribution of wealth in the opposite direction of what FDR redistributed in the New Deal.

Student aid has moved inexorably from scholarships and grants to loans. By the time Mr. Obama became POTUS, the privatization of student loans had proceeded to the complete absurdity that banks were allowed to charge for being middlemen in the transaction while the government still guaranteed the loans. Gov. Romney, had he been elected, promised to reinstate what President Obama had changed in the interest of getting more money to more students at lower rates. I never heard Romney explain why this would be good public policy beyond the GOP bromide that the private sector can do anything and the public sector can’t do anything, a position belied by the historical account in Jim Manzi’s essay.

The upshot of this turn to privatized loans is a debt bubble with serious economic consequences for us all.

One consequence is the slow recovery of the housing market, once driven by first time buyers, who now graduate with too much debt to qualify for a mortgage.

Another is the securitization of student loans in the same manner that mortgages were securitized before the great crash in 2008, because the Dodd-Frank reforms to prevent it have been watered down and tied up in the rulemaking process by the investment banks, who don’t do student loans but do have an interest in all kinds of derivative securities.

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I met another consequence of student aid policy in the last two weeks, when I had occasion to chat with three medical students who were interning under doctors I was visiting. They all knew about the impending shortage of family practice docs because Obamacare allows people to seek medical care they could not afford when uninsured. Two of the three would enter family practice if they could, but felt they needed the higher income of specialization to deal with their student loan debt.

In terms of getting an interview for most white-collar jobs the four-year degree is the new high school diploma. Seven in 10 students graduate with debt at an average of $29,400. Here is a graphic that breaks it down by state. Graduate school, law school, medical school---all multiply that debt load. We have a generation of young people trying to begin independent lives with millstones of debt around their necks far beyond what my generation faced, because tuition and books have gone up while financial aid has been moved from grants to loans, and, worse, privatized.

Another privatization problem is the growth of “colleges” that exist to rake in government guaranteed student loan money. They admit anyone who can sign a loan application and then they take the money and run. They victimize the uneducated—student loans cannot be discharged in bankruptcy, as they could in my generation—and they victimize the taxpayers who underwrite the loans. For tribal governments, seeing that their citizens are not ripped off in this manner ought to be a priority.

On the rezes, the lack of human capital is complicated by the tendency of kids who do get a good education to leave. The primary reason is lack of opportunity at home and creating opportunity is hampered by…lack of a reliable and educated workforce and constant innovation. That is, human capital. We leak it like so many sieves. Repair the leak by tying tribal education funding to participation in the tribal economic development plan (which means tribal government has to have a tribal economic development plan).

Another kind of capital, physical infrastructure, suffers both in the US and in Indian country.

Thanks to the Republican “disbelief” in Keynesian economics, the US has bridges and roads in a sorry state of disrepair and lacks an electrical grid to handle the renewable energy that should be the wave of the future if the same Republicans “believed in” climate change. This disrepair co-exists with a completely unacceptable unemployment rate.

Until the GOP learns to distinguish opinion from arithmetic, unemployment will coexist with failing infrastructure. We still use public works built by the WPA and the CCC for the New Deal, when the major objective was to put people to work. Since President Reagan, the major objective has been to shrink the government, which Mr. Reagan said is the problem, not the solution.

Reagan’s acolyte, Grover Nordquist, said it best: “Our goal is to shrink government to the size where we can drown it in a bathtub.”

This nonsense is seductive to some Indians because they are used to a corrupt tribal government being the only substantial employer and then only for the relatives and cronies of those running the government. From here in the cheap seats, it appears to me that the tribal governments most likely to avoid that mire are those that use income from extractive industries or casinos to diversify.

Resource extraction is temporary because of depletion. Casino money is temporary because of market saturation and a limited supply of suckers that state government will become less willing to share. Tribal governments can “share the wealth” with voters by per capita payments or maintain the wealth for coming generations by capitalizing businesses and training tribal citizens to run them. It’s a stark choice between short-term political gain and long term prosperity.

Let’s not get started on the kind of basic research that leads to new technologies. It’s a symptom of Indian country’s problems that even mentioning these things is to invite ridicule. How do we make basic research real in Indian country when it’s fading in the country generally?

Until Indian nations are self-sustaining, they will never be independent, and so our fate is joined with that of the US. To turn the US around, and therefore our prospects around, we need to understand the role of government in the history of all nations. If the messenger has to be a conservative tech geek, listening to him is better than not getting the message.

Steve Russell, Cherokee Nation of Oklahoma, is a Texas trial court judge by assignment and associate professor emeritus of criminal justice at Indiana University-Bloomington. He lives in Georgetown, Texas.