Sometimes my wife and I tire of nuance, subtlety and texture.
I bet you do, too.
When that happens, we have a remedy. Ours is to watch a kill-the-bad-guys movie, a film genre that has been perfected over many decades.
First you have a bad guy with absolutely no redeeming features. Then you have a usually peaceful good guy who is offended when the bad guy hurts or kills someone. Think Clint Eastwood, Liam Neeson, Denzel Washington or Keanu Reeves. But you can also go way back to Alan Ladd or Gregory Peck.
The good guy reluctantly puts away his carefully constructed, peaceful self. He goes to his cache of weapons.
Escaping complexity
Then he proceeds, without a single nuance, to destroy the bad guy(s).
So very, very satisfying.
It’s not the real world, but it’s a great escape from the unending complexity of real life. It’s also an escape from how much we don’t know. What we don’t know is a daily problem for all of us.
That’s the way it is.
Complexity is us
We live in a complex, knowledge-filled world. And, collectively, we’re the ones who made it that way. That’s what we humans do.
Long term, we’ve benefited from complexity. We live longer. Fewer of our children die as babies. Fewer mothers die having babies. We have cures for a variety of diseases and operations for a multitude of conditions. We carry lightweight portable phones that have more computing power than the MIT campus had in 1960. We grow more in an acre of dirt than ever before, and we live in larger, heated and air-conditioned houses. They even have indoor plumbing, which wasn’t common as late as 1940.
It’s all quite fabulous.
It’s fabulous except for one really big thing. Each advance can make us feel helpless in yet another aspect of our lives. That includes things as “simple” as not having read the 400-page owner’s manual for a new car. Every day we depend on dozens of things we don’t understand at all. It’s humiliating.
The result?
The rebellion against complexity. We want to shut it out. We want to call in “The Simplifier,” whoever our favorite enemy-destroying hero is because it all feels so threatening even if we know that we can’t live as we do without the daily personal deflations from complexity.
Measuring complexity
One of the best ways to see the rise of complexity is to examine how much the government of the United States has changed since 1950. Of the 15 government departments, seven were created after 1950:
- Health and Human Services, 1953
- Housing and Urban Development, 1965
- Transportation, 1967
- Energy, 1977
- Education, 1979
- Veterans Affairs, 1989
- Homeland Security, 2002
Beyond that, we’ve also had a proliferation of federal agencies such as the National Science Foundation (1950), the Small Business Administration (1953), the US National Transportation Safety Board (1967), the Environmental Protection Agency (1970), the Commodity Futures Trading Commission (1974), the Federal Energy Regulatory Commission (1977) and the Consumer Financial Protection Bureau (2011), to name a few.
Now let’s ask a simple question.
Does the vastly more complex government of 2020 need a bit more tax support than it needed in the Good Old Days of John Wayne and “Leave It to Beaver”?
If you think there’s some room for discussion here, then consider these figures. In 1950, the “on budget” of federal spending that sustained the operation of our entire government except for the “off budget” (mostly Social Security) amounted to 15.1 percent of our gross domestic product (GDP).
It was a deficit year because revenue was less, 13.4 percent of gross domestic product.
Now, fast forward to the present. In 2019, “on budget” spending was 16.7 percent of GDP, a minor increase from 1950 given the greatly increased complexity of our society and economy. Even if you adjust for the higher spending for defense in 1950 (4.9 percent of GDP) than in 2019 (3.2 percent of GDP), you have to wonder if the increase is enough to handle the rising complexity of the last 70 years.
Now consider revenue. At 12 percent of GDP today, it is less than the 13.4 percent of 1950. So tax collections are down, not up.
Does this strike you as a bit illogical?
Spending Rises with Complexity |
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| This table, taken from the president’s annual budget, presents figures for government spending and revenue from a simpler time and contrasts them to the same figures for today. Figures are expressed as percentage of gross domestic product to provide a sense of spending and revenue in relation to the entire economy. | |||
| Year | Revenue | Spending | Deficit |
| 1950 | 13.4% | 15.1% | -1.7% |
| 2019 | 12.0 | 16.7 | -4.7 |
| Source: https://www.whitehouse.gov/wp-content/uploads/2020/02/hist_fy21.pdf | |||
We’d have a smaller deficit if we were willing to support as much government as we supported in 1950. We’d have no deficit at all if we admitted that our society and economy were a tad more complex than they were in 1950 and required tax revenue of 16.7 percent of GDP.
Want to get your head around how complex our government is, all that it does and why it’s important to do it? You can do it without having your brain explode by reading “The Fifth Risk,” Michael Lewis’ amazing short book on the transition after the 2016 presidential election. Lewis also gave us “Money Ball” and “The Big Short,” which are pretty good indications it’s a good read. You won’t go to sleep.
If I was the Supreme Grand Pooh-Bah, this book would be required reading for everyone of voting age in America, including those who purport to represent us.
Reading would be followed by a test in November.
Measuring Fabulous
If you want to see just how fabulous, check out the TED talk by Hans Rosling at this link: https://www.ted.com/talks/hans_rosling_the_best_stats_you_ve_ever_seen
For a deeper dive into the roots of human progress, watch the animation and interview with Matt Ridley, author of “The Rational Optimist.”
https://www.youtube.com/watch?v=k-yS8CGUzN4
You can get books by both authors, overnight, from Amazon:
Hans Rosling, “Factfulness: Ten Reasons We’re Wrong About the World – and Why Things Are Better Than You Think” https://www.amazon.com/Factfulness-Reasons-World-Things-Better/dp/1250107814/ref=sr_1_1?crid=7E9A21125AYK&keywords=hans+rosling%2C+factfulness+2018&qid=1583960822&sprefix=Hans+Rosling%2Caps%2C183&sr=8-1
Matt Ridley, “The Rational Economist” https://www.amazon.com/Rational-Optimist-Prosperity-Evolves-P-s/dp/0061452068/ref=sr_1_1?crid=14376PUTJ0N08&keywords=matt+ridley+rational+optimist&qid=1583960687&sprefix=Matt+Ridley%2Caps%2C184&sr=8-1
Related columns:
Scott Burns, “This Old Mobile Home: Lessons from a Book Purge,” 5/7/2019 https://scottburns.com/this-old-mobile-home-lessons-from-a-book-purge/
Scott Burns, “What I’d do to save America,” 11/23/2019 https://scottburns.com/what-id-do-to-save-america/
Sources and References:
Budget of the United States, historical data https://www.whitehouse.gov/wp-content/uploads/2020/02/hist_fy21.pdf
Michael Lewis, “The Fifth Risk: Undoing Democracy,” Norton, 2018 https://www.amazon.com/Fifth-Risk-Undoing-Democracy/dp/0393357457/ref=sr_1_1?crid=3B894SXD66TCD&keywords=michael+lewis+fifth+risk&qid=1584040234&sprefix=Michael+Lewis%2Caps%2C1217&sr=8-1
This information is distributed for education purposes, and it is not to be construed as an offer, solicitation, recommendation, or endorsement of any particular security, product, or service.
Photo: Pixabay
(c) Scott Burns, 2020
3 thoughts on “The Rebellion Against Complexity”
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A question from an admirer but perhaps a dull one (have not read the Lewis book): Why are tax collections down while my personal tax bill post-retirement seems always on the increase despite whatever modifications Congress continues to make – or is that the problem, and how would you correct same? Long story?
For most people even the most impassioned tax debates are a Shakespearian experience: Much Ado About Nothing. I learned this many years ago when a diligent reader sent me a record of his income taxes from the early years of his marriage, to buying a home, saving in retirement plans, to well after his children had graduated from college. Although Congress had passed lots of tax legislation after heated debate during those years, his federal income tax bill had been in a very consistent range of about 13 percent. The big tax changes are often found in the very fine print.
This observation is confirmed by broader figures from the Internal Revenue Service on average tax rates at different income levels: the rate for most income groups varies very little.
One cure that I’ve suggested many times is to replace the income tax with a national sales tax such as the Fair Tax proposal. This would be a flat tax on all consumption spending that would offset its regressive properties by providing a large “prebate” that would compensate for all spending up to some inflation-indexed amount such as twice the federal poverty income for a household size or some portion of the national median income.
Liberals scorn the idea with the misguided notion that the tax would be regressive, not understanding that income that remains invested, not consumed, benefits everyone and that wealthy spendthrifts would pay far more in taxes than regular workers who might pay no federal income taxes at all.
For most people, probably a very large majority, most tax “reforms” don’t change much and aren’t enough to offset the slow creep of complex tax interactions.
—You’ve probably lost any itemized deductions that lowered your bill in the past.
—Also, as a retired person you no longer have tax deductions for retirement plan contributions.
—You may be in the range of having your Social Security benefits taxed.
—And if your income is high enough, you may be needing to pay more for your Medicare insurance.
All those things can make your tax bill as a retiree higher than you thought it would be.