Reappraisals Read Free Page A

turn back to the political symbols, legal resources, and physical barriers that only a territorial state can provide.
    But the state in my second sense has a more directly political significance. In part as a result of war—the organization and resources required to fight it, the authority and collective effort involved in making good its consequences—the twentieth-century state acquired unprecedented capacities and resources. In their benevolent form these became what we now call the “welfare state” and what the French, more precisely, term “l’état providence”: the providential state, underwriting needs and minimizing risks. Malevolently, these same centralized resources formed the basis of authoritarian and totalitarian states in Germany, Russia, and beyond—sometimes providential, always repressive.
    For much of the second half of the twentieth century, it was widely accepted that the modern state could—and therefore should—perform the providential role; ideally, without intruding excessively upon the liberties of its subjects, but where intrusion was unavoidable, then in exchange for social benefits that could not otherwise be made universally available. In the course of the last third of the century, however, it became increasingly commonplace to treat the state not as the natural benefactor of first resort but as a source of economic inefficiency and social intrusion best excluded from citizens’ affairs wherever possible. When combined with the fall of Communism, and the accompanying discrediting of the socialist project in all its forms, this discounting of the state has become the default condition of public discourse in much of the developed world.
    As a consequence, when now we speak of economic “reform” or the need to render social services more “efficient,” we mean that the state’s part in the affair should be reduced. The privatization of public services or publicly owned businesses is now regarded as self-evidently a good thing. The state, it is conventionally assumed on all sides, is an impediment to the smooth running of human affairs: In Britain both Tory and Labour governments, under Margaret Thatcher and Tony Blair, have talked down the public sector as dowdy, unexciting, and inefficient. In Western societies taxation—the extraction of resources from subjects and citizens for the pursuit of state business and the provision of public services—had risen steadily for some two hundred years, from the late eighteenth century through the 1970s, accelerating in the course of the years 1910-1960 thanks to the imposition of progressive income tax, inheritance tax, and the taxation of land and capital. Since that time, however, taxes have typically fallen, or else become indirect and regressive (taxing purchases rather than wealth), and the state’s reach has been proportionately reduced.
    Whether this is good or bad—and for whom—is a matter for discussion. What is indisputable is that this public policy reversal has come upon the developed world quite suddenly (and not only the developed world, for it is now enforced by the International Monetary Fund and other agencies upon less developed countries as well). It was not always self-evident that the state is bad for you; until very recently there were many people in Europe, Asia, and Latin America, and not a few in the U.S., who believed the contrary. Were this not the case, neither the New Deal, nor Lyndon Johnson’s Great Society program, nor many of the institutions and practices that now characterize Western Europe would have come about.
    The fact that Fascists and Communists also explicitly sought a dominant role for the state does not in itself disqualify the public sector from a prominent place in free societies; nor did the fall of Communism resolve in favor of the unregulated market the question as to the optimum balance of freedom and efficiency. This is something any visitor to the social-democratic countries of