Word for Wednesday Repost: Progressive
Back in the Triassic Era of blogging, I ran for a while a weekly feature called Word for Wednesday, loosely modelled on Raymond Williams Keywords. I thought I’d repost one entry in response to this interesting debate starting with Henry Farrell at Crooked Timber
Progressive Definition 1: In its political sense, progressive means ‘on the side of progress’. This incorporates a factual assumption that history is moving in some definite direction, and a political program aimed at accelerating that motion and overcoming obstacles to it. Antonyms are ‘conservative’ and ‘reactionary’.
Until about 1975, the facts seemed to be consistent with the idea of steady movement towards some form of democratic socialism. After this, economic and social policies moved substantially in the opposite direction for the rest of the 20th century, with large-scale privatisation and deregulation in many countries. This movement in turn seems to have ceased and even to have partially reversed in countries such as the UK and NZ.
In the 1990s, a new version of progressive rhetoric came into use, focusing on the notion of globalisation as an irresistible force for progress in the direction of free-market liberal democracy. Fukuyama’s End of History was the big text, while Thomas Friedman’s The Lexus and the Olive Tree was a successful popularisation. Many proponents of this account were unaware of the basic historical fact that world markets were more liberal and globalised in 1900 than in 1970. When this was pointed out, the notion of globalisation as inevitable progress went into decline, although it still has its proponents. The wave of financial crises from the late 1990s reminded people of the fact that unregulated capital markets are the result of policy decisions that may have been mistaken, not the product of inexorable technological forces.
If no clear direction can be discerned in history, or if reversals lasting for decades are possible, the whole idea of ‘progressive’ politics becomes incoherent. Unfortunately, the idea is deeply embedded in political rhetoric and is therefore hard to get rid of. As long as the term ‘progress’ is taken to imply ‘progress towards something better’, people will try to attach its positive connotations to their political programs. Even the connotation of ‘something not necessarily good, but irresistible’, has a lot of rhetorical power, as in ‘you can’t stop progress’ – Marxist historicism is the extreme example of this. Former social democrats like Paul Keating justified adopting the political program of their opponents by appeals to progressive rhetoric, treating current trends as both irresistible and desirable simply by virtue of their currency. At this level, though, ‘progressive’ politics is little more than adherence to prevailing fashion.
It may be possible to salvage some use for the term ‘progressive’ by defining ‘conservative’ as ‘opposed to rapid programmatic policy change’, without reference to specific policy programs, then defining ‘progressive’ as an antonym. I plan to explore this next week.
Progressive Definition 2: In tax policy, a progressive tax system is one in which the proportion of income paid in tax is higher for those on higher taxes. The antonym is ‘regressive’. As I noted in an earlier post, most actual tax systems are based on a mixture of progressive taxes like income taxes and regressive taxes such as payroll and consumption taxes, with the total effect being roughly proportional.
The term ‘progressive’ here, is basically derived from the mathematical fact that the rate of tax increases (progresses) with income, but also gains some support from the fact that progressive taxes are pro-poor and therefore progressive in the sense of Definition 1. This creates problems when we try to assess the distribution of benefits of public expenditure. Mathematically, an expenditure program would be progressive if the benefits flowed disproportionately to those on high incomes – this would mean that progressive taxes and progressive expenditure worked in opposite directions.
In practice, a messy compromise has prevailed. Expenditure patterns are typically compared to a starting point where the benefit is the same for everyone (this is fairly close to the actual situation in most countries). If programs that favor the poor (such as means-tested benefits) predominate, the system is described as progressive. If programs that favor the rich, such as protection of property, predominate, the system is described as regressive.
A bit extra Working out the final incidence of tax and expenditure programs is very complex. But here’s a rough illustration of what happens when you have proportional income taxes and equal expenditure per person – this, and the numbers used, are not too far from the actual situation.
Suppose we divide the population into quartiles by income, and suppose that the bottom quartile gets 10 per cent of all market income, the next quartile gets 20 per cent, then 30 per cent and the top quartile gets 40 per cent. Now suppose there is a proportional tax that collects 40 per cent of national income, and the proceeds are spent in such a way that everyone gets an equal benefit. So the bottom quartile pays taxes equal to 4 per cent of total income, and gets benefits equal to 10 per cent, ending up with 16 per cent. Similarly, the other quartiles end up with 22 per cent, 28 per cent and 34 per cent respectively. So a 4:1 ratio in market income ends up as a roughly 2:1 disparity in final income (including publicly provided goods and services).