The Ratchet Effect
Daniel McCarthy praised Higgs and summarized his ratchet effect theory in a review of
Against Leviathan that appeared in
The American Conservative. In the review, McCarthy remarked that,
What made Crisis and Leviathan a milestone was the rigor with which it elaborated upon the logic of James Madison's 1794 warning against "the old trick of turning every contingency into a resource for accumulating force in government." Other political economists had studied the growth of state power during times of war, depression, and general upheaval before, but none had done so as thoughtfully and thoroughly as Higgs. He took special care in describing the "ratchet effect" ... once a crisis has passed state power usually recedes again, but it rarely returns to its original levels; thus each emergency leaves the scope of government at least a little wider than before.
Jörg Guido Hülsmann, Joseph Salerno, Lew Rockwell, and other scholars have discussed the Higgs Ratchet Effect in their writings.
The Iraq War
A vehement critic of the Iraq war, Higgs wrote in the
Los Angeles Chronicle in February 2008 that only a high toll in casualties or economic hardship will end the Iraqi war, not cogent arguments. Higgs continued:
It follows directly that up to this point the continued prosecution of the war has served the leaders' interests. They may say they are trying to end the war. They may have secured their election or reelection, as many of the Democrats now serving in Congress have, by promising to do whatever they can to end the war. Yet the truth is that they've sold the public a bill of goods. When the leaders have considered all the personal consequences they expect to follow from acting to end the war, they have concluded that, all things being considered, doing so does not serve their interest, and therefore they have refrained from doing so.
Fannie Mae, Freddie Mac, and social security
Higgs's 10 September 2008 article, "Ticking Time Bomb Explodes, Public Is Shocked," stated that
[t]he failure of Fannie Mae and Freddie Mac, setting in motion the biggest government bailout/takeover in U.S. history, brings a grim sense of fulfillment to competent economists.... Our political economy is rife with such catastrophes in waiting, yet the public always seems startled, and outraged, when the day of reckoning can no longer be deferred, and another apartment collapses in the state’s Hotel of Impossible Promises, loading onto the taxpayers more visibly the burden of sheltering the previous occupants.... Call it democracy in action or utterly corrupt governance; they are the same thing.
The article was praised and quoted on-air by several talk radio personalities, with WBEN Buffalo's Tom Bauerle stating that it was one of his favorite "all-time articles."