Zipline Conservative

November 26, 2008

The Ratchet Effect (‘opportunity in crisis’)


This seminal treatise in the history of ideas demonstrates what has come to be known as the Higgs thesis: that government grows in periods of crisis, for example, war and depression. He demonstrates this with a detailed look at twentieth century economic history.

Higgs’s thesis is so compelling that it has become the dominant paradigm for understanding the so-called ratchet effect: government grows during crisis and then retrenches afterwards, but not to the same level as before.

This book is absolutely essential for anyone who seeks to understand the dynamics of government growth and the loss of liberty.

Emanuel channels his inner Tugwell

Posted by Evan McLaren on November 22, 2008

The Limbaughs and Hannities of the world are pointing and shrieking at Rahm Emanuel’s remarks about opportunity in crisis. But Emanuel is merely enunciating a conventional idea that is basic to contemporary managerial rule. If GOP talkers want to rail at someone for developing this tactic they should learn about the New Republic-type liberals who grouped around Woodrow Wilson and FDR. My favorite is Rexford Guy Tugwell, who understood the opportunity the liberal regime had squandered during World War I.

“We were on the verge of having an international industrial machine when peace broke,” wrote Tugwell. “Only the Armistice prevented a great experiment in control of production, control of prices, and control of consumption.”

Emanuel is just a little ahead of the curve. Robert Higgs should send him a thank you note for effectively distilling the Ratchet Effect in a candid little moment.


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