Hendrickson’s View
Mark W. Hendrickson
Mark Hendrickson is an economist who recently retired from the faculty of Grove City College, where he remains a Fellow for Economic & Social Policy for the college’s The Institute for Faith and Freedom.
Ed Feulner, Jr. (1941-2025) RIP
Editor’s Note: Ed Feulner was the keynote speaker for The St. Croix Review’s 2021 Annual Dinner. It is a continuing sorrow for our organization that the person hired to record the event failed to appear.
Edwin (Ed) Feulner, Jr., Ph.D., was one of those special individuals whose influence on our lives far exceeded his fame. Best known in conservative circles as one of the two co-founders (along with the late Paul Weyrich) of the Heritage Foundation, Dr. Feulner was arguably the preeminent architect of the conservative public policy think-tank movement. In addition to Heritage, Feulner helped to launch such vibrant and influential organizations as the State Policy Network, the Philadelphia Society, and the American Legislative Exchange Council. These organizations comprised much of the institutional infrastructure by which conservative ideas and values were applied to current public policy issues.
Feulner was a visionary. Founding Heritage in 1973 (the year he turned 32 years old), what started as a nine-man team grew and grew. With Ed as its president from 1977 until 2013, Heritage became famous for publishing clear, concise papers explaining how the core beliefs of the American founding — free enterprise, limited government, strong national defense — could be translated into policies appropriate for our time. Under his leadership, Heritage grew to somewhere between 500 and 1,000 employees.
I had my own “close encounter” with Heritage in 1984. Having just completed my doctorate in economics while marrying my wife and adopting my daughter the previous year, the fine English scholar, Stuart Butler, offered me a job as a policy analyst at Heritage. I was honored, to say the least. But there was a practical problem: The pay offered to me was $20,000 per year. Remember, this was 1984. Mortgage rates were 15-16 percent at the time. My family and I were paying off a 2700-square foot house in the bucolic Pennsylvania countryside. A comparable property anywhere within commuting distance of Washington would cost almost three times as much. Financing such a mortgage while making only $20,000 per year (pre-withholding) rendered a move to D.C. unaffordable, and so I had to decline the offer.
The Heritage Foundation was still young in 1984. Today, Heritage pays their summer interns $18 per hour, which would equate to $36,000 for a 50-week year at 40 hours per week. Of course, $36,000 today might not be much different from $20,000 in 1984, but the point is, back then a policy analyst with a doctorate was being paid like an intern working toward a bachelor’s degree. I don’t mention this to imply that Heritage was cheap, but rather that it took years and years of patient building to get to where they are today.
With Ed Feulner steering the organization, Heritage punched way above its weight. Working behind the scenes, cranking out policy papers and distributing every one of them to members of Congress, Heritage had a profound impact on American public policy from the late 1970s onward.
The presidency of Ronald Reagan was in many ways an embodiment of Heritage’s idea. Decade after decade, Heritage shaped primarily the Republican Party, and in doing so, was a principal architect of the conservative-libertarian movement.
Another milestone was the collaboration of Heritage scholars with Newt Gingrich that led to the 1994 “Contract with America,” that paved the way for Republicans to have a majority in the House of Representatives for the first time in four decades.
A personal observation: I only met Ed Feulner in person once, although I attended several of his speeches over the years. In the early 2010s, he was visiting Grove City College. Outside Harbison Chapel, I found myself walking next to him. We had a warm exchange. It felt like we were old friends. He was gifted with an easy-going, friendly personality — so down-to-earth, genuine, and accessible. There was no self-importance, no sense of heaviness or burden. He was at peace with himself — a very likable man who exuded the true-blue American values that he preached.
How blessed our country was to have this great man using his considerable intellectual and organizational talents to help preserve and promote all that is great about our country. God bless you, Ed Feulner. RIP.
Patriotism and Entitlement
Two intriguing surveys with profound implications were published recently. One dealt with patriotism, the other with the attitude of entitlement. Let’s start with patriotism.
On June 30, The Epoch Times reported on a Gallup poll indicating that “U.S. patriotism has plunged to a historic low.” A closer look at patriotism — defined in the poll as how proud one is to be an American — shows that the decline is largely partisan- and age-related.
Democrats set a record low with only 36 percent of those polled expressing much pride in being American. Similarly, only about 40 percent of the youngest generation polled — Gen Z (the oldest of whom are 28 years old) — felt “strong pride in being American.”
By contrast, the Gallup poll found that 92 percent of Republicans, about 60 percent of millennials, and 70 percent of older generations were proud of their citizenship.
What would explain a lack of patriotic pride — whether a lukewarm appreciation for one’s own country or an outright denunciation of it? Having gone through a period of — dare I say it? — anti-Americanism as a college student, I believe that I can offer at least a partial explanation.
Many Americans are subjected to a barrage of criticisms of our country. As I have written in this space before, the epidemic of teen depression is a national scandal, largely attributable to the warped view of reality to which their so-called educators subject them. Indeed, negativism is pervasive on many college campuses. A steady diet of the same United States-condemning negativism is fed to Americans through various media outlets, too.
There are several facts of life to consider before concluding that our country doesn’t deserve our pride.
First, perspective: Yes, our country has problems and challenges. But look at all the good our country has accomplished: Amazingly high standards of living compared with earlier generations; the defeat of Nazism, fascism, Japanese militarism, and Soviet Communism (the latter without firing a shot!), which made the world a safer place; and huge progress in reducing racism, pollution, and poverty. The United States may not be heaven on earth, but we have much to be proud of and grateful for.
Second: When the other party has the upper hand in Washington, it isn’t the end of hope. Political power does not guarantee a great society. If top-down centralized planning were the key to creating the ideal society, then surely the various totalitarian regimes that have existed throughout history would have proven that theory by now. But they haven’t. Actually, inventions, solutions, and prosperity emerge from the private sector, so even if your party is not in a position to implement its plans, you can still make positive contributions to society through your individual efforts.
Third, perhaps we Americans are somewhat spoiled. Growing up, I was never threatened by hunger or homelessness. All my needs were met, and I pretty much took that state of affairs for granted as the normal way things are supposed to be. Why couldn’t everyone have it that good, as I so naively believed? While I was in college, and all the bills were paid for me, and food services prepared my meals, and I had abundant time to fool around, life seemed easy. When I got out of school, I had to scramble for jobs to make sure that I could pay the rent and utilities and buy groceries and gas. The proverbial light bulb came on: I began to see that life was more complicated and less easy than I had imagined in the bubble of college life.
Millions of Americans today are, if you’ll pardon me, spoiled just like I was. This attitude is particularly pronounced among Gen Z, as the other survey I mentioned above — this one by Intelligent.com — highlighted. That survey found that “24 [percent] of hiring managers believe recent college graduates are unprepared for the workforce, while 33 [percent] cite a lack of work ethic, and 29 [percent] view them as entitled.” Many students graduate from college firmly believing that they are entitled to start out with a gaudy salary and a wide range of perks, while having minimal accountability. How did this attitude take root in so many young Americans?
Frankly, students have been babied. Academic standards have been watered down, and students have been given so-called safe spaces in which they are insulated from interaction with people holding differing opinions. They have been deceived by the implied promise that a bachelor’s degree guarantees them access to a great job.
How much do you want to bet that young people given such an unrealistic view of how the world works are the ones who don’t feel patriotic about their country? Everyday reality falls far short of the fantasies by which so many college students have been mesmerized. It can be a shock to these young adults to learn that, while all Americans have the opportunity to achieve success, in reality, some succeed and others do not.
To these compatriots, I would say: The essence of the American Dream has always been for each of us to have the freedom that provides the opportunity to achieve success and do our small part to contribute to social progress. However, freedom does not guarantee success.
For those of you currently not feeling patriotic pride in being an American, may you learn to appreciate the freedoms that we Americans have. If that is not enough for you, best of luck in finding a country where your dreams can come true.
What the U.S. Can Learn from Javier Milei
Javier Milei, the libertarian economist who has been Argentina’s president for the past year and a half, deserves more publicity here in the States than he is receiving. A recent online search led me mostly to reports by think tanks in foreign countries. Reports from domestic media outlets were conspicuously absent from my search results.
I suspect that the lack of coverage of Milei is because his policies are anathema to progressive orthodoxies. His low profile is unfortunate, because what he has done includes valuable lessons for us to learn.
He could easily serve as a poster boy for the Department of Government Efficiency initiative. He famously brandishes a chainsaw at public appearances when he advocates slashing government spending. The fact is, he has taken a figurative chainsaw to Argentina’s national budget. Milei reduced the number of government ministries in Argentina from 18 to 8 and laid off nearly 10 percent of government employees. He has cut government spending by 31 percent — an amount approximately equal to 10 percent of the country’s gross domestic product (GDP). A 31 percent cut in U.S. government spending would be more than $2.1 trillion, and yet we have just seen how politically difficult it was to pass a rescission bill that cut a measly $9 billion from federal spending. (A 10 percent cut of our GDP would be more than $2.7 trillion.)
So, what has happened in Argentina in the aftermath of Milei’s massive spending cuts? Has the economy collapsed? Hardly. Second-quarter GDP rose by 7.6 percent, and the government is running a fiscal surplus for the first time in 14 years. If only U.S. President Donald Trump could have half the success as his Argentine counterpart in slashing government spending!
The significance of Milei’s accomplishments is that he has slain an old Keynesian dogma that has repeatedly hampered the U.S. economy for more than 90 years now. A quick refresher course in U.S. economic history:
Throughout the 1930s — first under Herbert Hoover, then under Franklin Roosevelt — the U.S. government engaged in heavy government deficit spending in a committed effort to pull the country out of depression. Clearly, running up the federal debt and intervening in various parts of the economy didn’t work. Halfway through the decade, in December 1935, famous British economist John Maynard Keynes published a new book, The General Theory of Employment, Interest, and Money, in which he basically said to the Roosevelt administration: “You are doing the right thing. Keep spending!” Well, Roosevelt followed the economist’s advice, and the depression lingered for another five years.
This had two pernicious long-term effects. 1) Economists got the message that governments weren’t interested in free-market solutions. They wanted intellectual support for government intervention, and if you wanted fame as an economist, it helped if you gave intellectual cover to politicians who wanted to be seen as “doing something.” 2) Government intervention, including deficit spending, became the unquestionable political orthodoxy. As Barack Obama framed the orthodoxy in January 2009, “only government can” lead a country out of recession. The problem with that assertion is that it is spectacularly wrong.
The recent events in Argentina have proven to the world that an economy can grow vigorously at a time of drastically reduced government spending. Our own history features a similar example. A decade before the Great Depression started, the United States suffered a wrenching depression. Largely forgotten today, the Depression of 1921 was a jarring economic contraction in 1920 and 1921. It was as steep, rapid, and severe as any economic downturn in American history. GDP plummeted by 23.9 percent, wholesale prices collapsed by a stunning 40.8 percent, and unemployment jumped by more than 10 percentage points in a single year, hitting 14 percent in 1921.
What was the federal government’s policy response to this brutal depression? Newly elected President Warren Harding cut federal spending almost in half from President Woodrow Wilson’s 1920 budget ($6.3 billion) to $3.3 billion in 1922. Harding also reduced income tax rates, leaving more of the country’s wealth in the private sector. He cut the top marginal tax rate to 58 percent from 73 percent. From 14 percent in 1921, the unemployment rate fell to 6.7 percent in 1922 and all the way down to 2.4 percent in 1923. Industrial production soared by 27.3 percent in 1922, and in just a few years, GDP rose a whopping 60 percent. Harding presided over one of the greatest economic success stories in American history.
Keep this in mind the next time you read one of those historians’ polls that routinely grade Harding — who had the most successful economic policies of the 20th century — as one of our worst presidents, while Roosevelt, whose deficit-spending policies caused years of stagnation and misery, is ranked as one of the best. This is ideological blindness. Progressive historians believe religiously in big government; thus, Roosevelt, a leading practitioner of big government, is lionized (even though his policies crippled the economy) while Harding, who eschewed government intervention and chose to trust in free markets, is vilified (even though his policies led to booming prosperity).
Harding’s handling of the Depression of 1921, along with Milei’s current policy successes in Argentina, should drive a dagger through the heart of the Keynesian dogma that government deficit spending is the cure for economic depressions.
Shrinking government and getting it off people’s backs is what works. But don’t expect most of our “intellectual” and political classes to accept this lesson. Their dogged (and self-serving) faith in big government will not yield to mere facts.
Right Ways and Wrong Ways to Democratize Education
One defining characteristic of Americans over the generations has been a deep-seated antipathy toward elitism. We rebel against any attitude, belief, or ideology that would relegate “the common man” to a secondary status.
Americans’ anti-elitist values were early apparent in the field of education. Understanding that well-developed intellects constitute a valuable asset for any society, enlightened and generous individuals and institutions created scholarships that enabled students who otherwise could not afford to attend college to do so. It is estimated that by the 1670s, approximately 30 percent of Harvard’s student body was comprised of working-class students receiving scholarship assistance.
As other colleges opened for business, many of them also funded scholarships. While we salute these worthy efforts to democratize education, the fact remained that throughout most of our country’s history, the average American could not afford to go to college. For every fortunate individual who received a scholarship, there might have been a dozen other worthy candidates whose potential was never developed because they simply couldn’t afford a college education. This was no conscious plot against the poor; it was simply economic reality.
The federal government intervened to boost college enrollments under President Franklin Roosevelt’s National Youth Administration, which spent approximately $600,000 over nine years. (Small potatoes. That represents about three seconds’ worth of federal spending today.) Uncle Sam became much more heavily involved in higher education with the passage of the Serviceman’s Readjustment Act (the “G.I. Bill”) in 1944. Perhaps more than expanding the democratization of higher education, one purpose of the G.I. Bill was to keep returning World War II veterans off the job market to avoid a possible return to the high unemployment rates of the 1930s.
From the 1970s on, the federal government spent more money to increase college enrollments in the name of democratizing higher education — that is, making it available to a much broader swath of Americans. While the stated intention was to ensure that pupils of modest economic means would have greater access to higher education, the results of the government providing loans to millions of relatively poor pupils were not uniformly benign.
There have been at least two major negative repercussions of government attempt to democratize higher education by significantly increasing college enrollments via federal grants, work-study programs, and loans to pupils.
One negative repercussion: American colleges and universities began to crank out far more individuals with degrees than the job market could absorb. For example, Bureau of Labor Standards data show that 62 percent of high school graduates enrolled in college in 2022 even though more than two-thirds of jobs are in occupations that don’t require a college degree.
In addition to being a massive misallocation of resources such as one routinely encounters in a socialist system, the imbalance between jobs and degrees represents a betrayal of the millions of students who borrowed money to attend college on the implicit (and sometimes explicit) promise that a college degree was a ticket to a job in one’s chosen field. That promise has turned out to be fraudulent. It has left millions bitter as they now struggle with the burden of having to repay the loans that they took in the mistaken belief that a college degree would open the desired doors for them.
A second negative repercussion of the government inflating the number of college students is this: Pupils are not of uniform aptitude and talent. When college enrollments are smaller, colleges generally admit the cream of the crop — the small slice of the population that is capable of doing top-level intellectual work. The competition for limited spots means that the best and the brightest tend to win admission. Significantly boosting the number of students enrolled necessarily results in less capable students being admitted. This puts colleges in an awkward position: Either they maintain rigorous academic standards and flunk out the weaker students or, in an effort to keep administrators happy by keeping enrollment numbers up, they lower academic standards. To the extent that democratization dilutes talent pools and lowers academic standards, society is poorly served.
Seen in this light, President Trump’s efforts to scale back federal loan programs that artificially boost college attendance are most welcome. It is good to democratize opportunity, and private scholarships and loans do that. It is impossible, though, for the government to democratize talent. Such endeavors have proven to be costly, wasteful, counterproductive, and at times cruel. It’s the wrong approach. Basta! (Enough!)
There is another area of education where public policy is moving in a positive direction — too slowly for my taste, but at least in the right direction. That is the school choice movement. School choice is true democratization.
“Wait!” you protest. American children have universal access to government-funded primary and secondary schools. Education at those levels already has been democratized.
Sorry, I disagree. What needs to be democratized is true educational opportunity — not just the guarantee of a school to attend, but the freedom and opportunity to actually obtain a solid education. There are way too many dysfunctional schools where pupils are trapped. I have seen some of these schools from the inside, having worked as a substitute teacher in schools where a good day is one in which nobody gets hurt, but where very little learning takes place. School choice would enable children to escape such barren environments and transfer to a school where they actually learn.
Instead of lowering academic standards or using a diversity, equity, and inclusion program to boost minority enrollment at the post-secondary level, the best way to provide equal opportunity for admission into college would be to ensure that all American children have equal opportunity to receive sound K-12 educational training. Universal school choice would enable bright youths currently trapped in non-performing schools to develop the intellectual foundation they need to compete on an equal footing with their peers. Trying to compensate for an inferior K-12 education by admitting pupils into college who are not properly prepared clearly has not worked, but instead has been counterproductive and wasteful.
It is time to end the unholy alliance between the teachers’ unions (full disclosure: I am a former member of the National Education Association) and politicians willing to deny opportunity to precious children (often minorities) in exchange for monetary and organizational support from the unions. The next time you hear some union accuse a corporation of monopolistic practices, ask them: Do you support the teachers’ unions’ monopolistic practices when they argue against kids having the freedom to choose what school to attend? Do you want children to go through life handicapped by an execrable excuse for education, dooming them to minimal opportunities for economic advancement during their lifetimes?
Those questions may be indelicate, but that is exactly what is at stake in the school choice debate. If we genuinely want to democratize economic opportunity by making it more available to all Americans, then we need to give parents and children the freedom to choose the school that best serves their needs. True democratization empowers individuals, and that is what school choice does. The sooner school choice is made available to all American children, the better. *
