There is an interesting economics column in the Wall Street Journal on the similarities between the Greek meltdown and our own fiscal policies. I have long been a critic of the wild spending of both Congress and President Obama, including the recent proposal to simply pay for an over $200 million short-range missile program for Israel (here). This article discusses the possible disaster awaiting the United States as our leaders blissfully assume that a recovering economy will pay for their various programs and pet projects.
The column questions the logic of being able to tax their way out of this deficit. While I am socially liberal, I tend to be fiscally conservative and I find the current situation extremely alarming.
This article is interesting for its proposition that higher taxes are not able to close such a gap:
The feds assume a relationship between the economy and tax revenue that is divorced from reality. Six decades of history have established one far-reaching fact that needs to be built into fiscal calculations: Increases in federal tax rates, particularly if targeted at the higher brackets, produce no additional revenue. For politicians this is truly an inconvenient truth.
This is a different take on the problem. I have always been skeptical of the “spend out way out of the crisis” approach — which is an awfully convenient theory for members who are always inclined to spend more and put off payments to the future. Once back in power, the Democrats seemed to immediately fulfill a stereotype of higher spending and immediately turning to higher taxes as the solution. This is precisely the course that led to the last Republican takeover of Congress. In their defense, Democrats faced a crisis left to them by the Republicans and particularly George Bush who was one of the greatest spendthrifts in our history. However, they have shown no serious commitment to tackle these dire economic forecasts — gushing money in Iraq and Afghanistan while watching cities and states shutting down basic programs. Our debt is now growing at a record pace — roughly $5 billion a day (here).
This is not to excuse the Republicans who, under Bush, showed no restraint and left Obama with a massive debt. I simply have little faith in our current economic policies or a sense that leaders are seriously addressing the growing threat to the nation from our growing debt. Various countries have raised alarm over our debt and the similarities to the Greek meltdown, here.
For the column, click here.
Another thought:
I simultaneously believe unions are necessary and should not exist. Unions were invented to prevent local-monopoly corporations from exploiting and endangering workers. This was necessary for the workers because our government had abdicated its role of stopping exactly that kind of oppression, and it codified unions into law because it was easier than doing their own job. What the unions do is the purview of the Occupational Safety and Health Administration, and minimum wage laws. The government SHOULD be in the job of preventing companies from competing by exploiting their employees. But it isn’t, it is corrupt and owned by the corporations, so our taxes that support OSHA and minimum wage enforcement are wasted, and union dues are another “tax” on workers to get what should properly be a government service.
Unions should not exist. They themselves end up oppressing the corporation owners and investors by blackmailing them. But in our twisted government unions are often the last resort for employees that don’t want to get killed, or poisoned, or contract cancer on the job.
I believe society needs minimum wage laws and at least something like OSHA to protect employees from exploitive employers. I am not an advocate of either laziness or slavery, I see both as a form of theft. I have been a business owner and employer for thirty five years, I am not a bleeding heart progressive trying to coerce others into charity; that is ANOTHER form of theft. But I am a scientist, and if I can help it I will not let theories blind me to reality.
@Byron, Continued:
So my justification for government does not rely on supernatural authority, or the primacy of property, or even the primacy of a right to life or liberty. None of that is unqualified.
My justifications for government are empirical and analytical. Even a light reading of the history of countries (or an examination of current ones) tells us we are not safe without it. When we cannot stop murderers, pyschopaths kill their way to the top.
Criminals have no right to life or liberty or happiness. These rights are granted by PEOPLE, and people can rescind them, and for both actions (grant or recision) make mistakes that must be corrected.
I believe the inherent good, which we understand, is fairness, and the primary role of government is to enforce fair relations between its citizens and other people (not just other citizens). The force in enforcement is a necessity, but we all understand, when we are not overcome by emotion, that emotional decisions can be very bad decisions when considered rationally. This is human nature as well; emotional decisions by their nature do not consider long term consequences, losses, or admit the possibility of error. This is why we reserve the right to use force to third parties that are charged with only using it when reason dictates it, and that must ALSO answer to us as citizens. This is why we have trials, even of the killers we have on tape murdering people. This is why the juries cannot contain people that know the accused or the victims, because we want them to make rational decisions, not emotional ones. (At least when we think about it rationally, we do.)
I do not believe in subsidies, or affirmative action, or any tax breaks that is supposed to encourage or discourage any action. Even in gray areas, we either come to a decision that something is coercion or oppression that must be outlawed, or we do not. Government is not our moral conscience or our daddy. It is the armed and armored cop that works for the people, to defend the weak from the strong, to enforce equal opportunity by punishing coercion and oppression and deception, either by foreign invaders or domestic psychopaths.
Circa 1970, health insurance companies and banks did not seem coercive, deceptive, or oppressive. Now, to me, the evidence is clear that they are. I don’t care WHAT a contract says if the victim is misled and confused about what they are signing. I don’t believe in relying upon “buyer beware,” because I think it is unfair to demand somebody hire an attorney or be a legal scholar before signing a credit card contract.
To me, a secondary purpose of government is a limited amount of socialism. Government is the only entity that can truly run a zero profit, break even operation on behalf of the people. If a product-competitive market cannot provide roads and highways, the government should administer that effort as a public good on a break-even basis. If a product-competitive market cannot provide health insurance without a fundamental conflict of interest, and the people WANT health insurance, the government should provide it as a public good on a break-even basis. In all such cases, with 100% open-book transparency on finances and salaries, and no exorbitant salaries, perks or bonuses. (I don’t want to get into much specifics here, but I’d say the salaries should be the median salary of an equivalent position in the private sector, up to about five times the median salary of all citizens.) The same goes for social security, the FDA, the FAA, the EPA and other governmental organizations. I am not arguing these are well or rationally run, I do argue the need for them exists and that governmental organizations are NOT inherently corrupt.
I believe in private property and property rights, but the social contract supercedes those rights. In my view the Civil Rights act Title II outlawing discrimination on *private* property is entirely justified; using one’s private property to oppress a race is, to me, no different than using a private gun to deprive somebody of food and shelter and medical attention.
I also believe that all laws must be paid for, whether local, state, or federal. I do not believe in prosecutorial discretion, it produces unfairness when the local prosecutor chooses to not investigate or prosecute an abusive cop for political reasons. All such decisions should be made in public by a randomly selected jury of eligible citizens, required to serve, with limited postponements or excuse.
I believe in government of the people, by the society for the good of all society. Our form of government is, frankly, NONE of those. It is much closer to coercion OF the people, government by the corrupt on behalf of the rich.
I know you will focus on my use of the word “socialism,” it is a red button word. I said LIMITED, and NOT as a form of government. I believe in representative government, capitalism and product-competitive markets when monopolies are prohibited. I have no problem with millionaires and billionaires and disparate income. But the social contract still rules, and I believe there are functions that we as a society have decided and can decide in the future we do not WANT done at a profit, but we DO want the function. Police protection and court trials are the obvious examples, but other examples include food and building inspection, professional certifications, roads and highway construction, to a large extent basic education, and health insurance, and financial insurance.
It is just STUPID for the government to insure deposits without controlling the banks. Relying on people to not put themselves out of business is idiotic, and ignores the fact that controlling executives can get rich on salaries and bonuses while bankrupting investors and customers. If we cannot trust banks, the government SHOULD have implemented a “public option,” a break-even bank with deposit insurance available to all citizens. If commercial banks could not compete, so be it: We need banking, and if they cannot compete then we are obviously getting banking for less. It is a public good. Nobody has some inalienable right to earn a profit from banking, or any other product or service that our society deems to be necessary for survival.
@Byron:
Man is a social animal. I believe all brains detect equivalences in order to recognize and exploit patterns. I think WE all detect and resent being unfairly treated by authority (negative unfairness, at least), and we all detect and resent coercion by authority, and THAT is why we agree to the idea that all adults BEGIN with equal rights under the law, and can only lose them with cause. I think anything else is inherently unfair.
What are the rights? To be able to sleep in your tent at night, you can’t be worrying about being murdered, or robbed, or assaulted in your sleep. You can’t interact or cooperate with others if you are constantly worried about being deceived (and thus endangered), or worried that agreements won’t be kept, or that your tent and supplies will be taken while you are out hunting.
You need laws and standards of conduct, either enforced by individuals or enforced by everybody. “Everybody” is preferable, because you can’t punish somebody if you are dead or crippled. Only others can do that on your behalf. It takes the force of the whole society to investigate a theft if the thief is unknown.
So government arises when everybody in the tribe needs to live by the rules, including you, and if you break the rules, the rest of the society needs to find you and punish you and if possible, ensure you enjoy no gains and indeed suffer punitive losses for breaking the rules. At least to the best of their ability.
People TEND to rationally balance risk and reward, if not overcome by emotion. Society must make the risk clearly not worth the reward; in fact it should not even be close, so that no person will make a RATIONAL decision that a law should be broken for their own probable benefit.
If only those overcome with emotion break the law, that same act proves they cannot control themselves and must be restrained by society, or ejected from it.
For the most part I believe in majority rule, but not when it comes to issues of equality, special treatment, oppression or exploitation. When a population grows and issues grow more complex, I see no practical alternative except representative government. It (theoretically) can deliver two things; a manageable voting and debate process is just one of them; the more important benefit is having a group of people that can devote full days or weeks to understanding complex issues and then making an informed vote. Not that we do that here!!
That’s enough, I have to go somewhere.
Tony C:
So what is your basis for government and how do you see man as opposed to Locke and the Founders?
I meant “credible start,” not “credible intent.”
@Bob:
So your argument is that Locke’s position doesn’t have to comport to reality in any way whatsoever. If his claims about human nature are patently false, no biggie. If his claims about what in his view government must do are ridiculously wrong-headed and would (and have) failed in practice, so what?
In that case the founding fathers were wrong to rely upon him for implementing anything in REALITY, they might as well have read a novel and based our government upon THAT. If Locke’s argument does not have to stand up to scrutiny and does not have to be based on anything real, there is no point in arguing with his fevered fantasy.
However, I do not believe that was Locke’s intent. I believe Locke INTENDED his argument to be taken literally, and I believe that LOCKE believed his foundational statements reflected reality. I do not believe he was writing a self-contained work of fiction like Gulliver’s Travels (published a few decades after his death, I know). I think he THOUGHT he was writing a serious academic treatise about the real world and how governments should be arranged. I think our founding fathers thought the same thing, and that is why they subscribed to Locke’s theories.
If Locke’s intent was to reflect the real world, then he failed. He made a credible intent and it led to important and useful insights, but his foundational declarations are simply wrong in the details. If his intent was to provide an entertaining thought experiment as a diversion, I think he failed at that too, because I do not think our founding fathers saw it that way.
Tony C.: Locke is writing a treatise on what he thinks government should be; and in that treatise is using arguments he introduces as absolutes. If the absolutes he propounds have extant counter-examples that prove they are not absolute, his argument is based on falsehood. That is the relevance of counter-examples.
I see, and the expounding and arrangement of a priori principles is dependent upon empiricism how?
Tony C.: OUR social contract might be premised on property rights; not ALL social contracts are, and claiming (as Locke does) that property rights are essential to a social contract is simply false.
Again you’re inserting your own premise into Locke’s argument and attacking it. Truth is the agreement between knowledge and its object. Locke defining the social contract as it fits within HIS theory of government is no more espousing a falsehood than a mathematician who defines a point circle as a circle that has a diameter of zero. But, I hear you ask; “Eucliddin’ me; right?” No man, I’m not.
Tony C.: The precedents matter because he is using the claims to justify subsequent sentences, that is why he writes the claims down. If the foundational claims are false, they do not serve to justify his subsequent argument or final conclusions. I can claim that one plus one is three and generate all sorts of interesting mathematics from that “falsehood,” but none of it would be true.
The Mantra: Arguing is reason giving. Reasons are justifications or support for claims. Rationality is the ability to engage in reason giving. The alternative to reason giving is to accept or reject claims on whim or command.
Is Locke’s argument irrational? No. Counter-factual? No. Why? Because it’s not based in empiricism.
Just how does your mode of analysis tackle something like this?
“The rules that they make for other men’s actions, must, as well as their own and other men’s actions, be conformable to the law of nature, i.e. to the will of God, of which that is a declaration, and the fundamental law of nature being the preservation of mankind, no human sanction can be good, or valid against it.” – J. Locke
Got a ‘precedent’ that tells me what the will of God REALLY is?
Furthermore, getting back to your “one plus one” argument, if I told you that 7+5 is not equivalent to 12, would you consider that false? And if I told you it was a synthetic a priori judgment requiring a unity of apperception, i.e. requiring an individual to combine the concepts of 7 and 5 to create/arrive at the concept of 12; what then? (See ‘Critique of Pure Reason,’ I. Kant)
Tony C.: As far as the “state of nature” is concerned, Locke is wrong there, too. For the vast majority of recorded history, and for what we can determine about unrecorded history, men have not been free, equal, OR independent. They have been dependent and unequal, and therefore not absolutely free. Freedom is not our natural state except in the imagination; we are social animals that depend heavily for our survival on other humans and on collective action. Even modern hunter-gatherers work in family groups and cooperatively and collectively, they are not independent, and typically not equal.
Once again, your distinctions between truth and falsehood here are as foreign as the calling of balls and strikes during a football game. Locke is not making an empirical argument; Locke is not writing a history book; he’s forging a moral/legal framework based in concepts of pure reason.
Or as Kant would say…
“Everyone must admit that if a law is to be morally valid as a ground of obligation, then it must carry with it absolute necessity. [One] must concede that the ground of obligation here must therefore be sought not in the nature of man, nor in the circumstances of the world in which man is placed, but must be sought a priori solely in the concepts of pure reason; he must grant that every other precept which is founded on principles of mere experience-even a precept that may in certain respects be universal-in so far as it rests in the least on empirical grounds-perhaps only in its motivation indeed be called a practical rule, but never a moral law” (Kant, ‘Groundwork for the Metaphysics of Morals’)
See how all versions of His-story fall by the wayside as irrelevant within this context??
Tony C.: Whether our founding fathers adopted this model is immaterial, whether we live under it is immaterial. The point is whether Locke’s argument is sound, and it is not.
Given your ‘deft’ analysis of the foregoing, I’m constrained not to take your conclusions seriously just yet.
Tony C.: As far as Bentham is concerned: Have other independent researchers analyzed their samples and come to the same conclusion?
There is no Bentham; but there are the scientists who wrote the paper which has now been rigorously peer reviewed.
Tony C.: Have other researchers analyzed OTHER samples and come to this conclusion? I don’t know, but I doubt it.
Did you read anything more than the abstract before arriving at the foregoing conclusion?
@Byron:
I don’t find that true at all. One could say that government has distorted the natural market for murder, theft, assault and rape as well. We have less of it than the wild west primarily due to law enforcement.
Without a government to enforce it, how can BP be liable for anything? They signed no contract with the citizens of the Gulf, and those citizens did not own the water, or beaches, or sealife that they harvest to make their living. Shrimping or crabbing are an open resource there for the taking, it is all you can catch, but there is zero guarantee of catching anything. Same with tourism; the tourists don’t “belong” to anybody and no restaurant or hotel or camp ground has any inalienable right to a sufficient supply of tourists to keep them in business.
The fishermen have no right to expect fish to be in the gulf either.
So in your unregulated free market, what is to stop BP from taking all of the sealife (by way of poisoning or suffocating them), and repelling the tourists?
This isn’t like starting a fire on your property that destroys your neighbor’s house. That is HIS property. The sealife in the ocean is not anybody’s property, individually or collectively.
So why would BP be liable for anything at all? What inalienable rights of citizens or property would they be violating in your free market fantasy?
Tony C:
partially my point but my other point is that with 115 regulatory agencies you would think at least one or 2 would be on the ball. But in my opinion regulation causes more harm than good because people are not smart enough to anticipate all of the contingencies that could happen.
From my understanding had BP not been guaranteed by government of a limited liability they would probably not have risked drilling in 5,000′ of water to begin with. Government distorted natural market limits on willingness to accept risk by a company/individual.
Tony,
Don’t get me wrong. I’d prefer my imaginary daughter to not be a hooker. But if the choices are lobbyist, pol, or prostitute? I’m simply going to have to go with selling sex for money over selling principle and the rights of citizens for money.
@Buddha:
My daughter is happily married now to a successful business owner she loves and I like. But, in her mini-skirted concert and beach bikini days as a teen, I more than once felt the clenched-fist urge to assault the boys that got too aggressive and the fat old men that ogled her. I never did that, but if those relatively harmless incidents could put me into a protective buzz, I cannot imagine what I would have felt or done had she chosen to be a call girl.
@Byron:
Yes, OUR regulatory framework failed. Do you interpret that to mean no regulatory framework should be built, or enforced?
The fact that it failed means that BP got to do whatever it wanted; so in the absence of a regulatory framework they would have presumably done exactly the same thing — Take twelve safety shortcuts (that had all worked individually in the past, but not this many in a row or in combination) in order to save time and money and blow out the well.
Ineffective, incompetent, corrupted governmental oversight is not an argument for NO governmental oversight, it is an argument for effective, competent, honorable government.
I agree we don’t have that; if that is your point then we finally do agree on something.
“‘I say,’ asked Gilbert Keith-Worthing nervously, ‘are your oilwells safe?’
“‘Hell, yes!’ said Kip Chalmers. ‘We’ve got so many rules, regulations and controls that those bastards wouldn’t dare not to be safe!;”
from an op-ed by Gerald P. O’Driscoll, Jr. of the Cato Institute, writing in the Wall St. Journal of June 14th.:
“The Gulf oil spill and the global financial crisis both demonstrate the failings of big government.”
“The regulatory state did not prevent excessive risk taking whether in financial services, nor perhaps in offshore oil drilling.”
“Financial services have long been subject to detailed regulation by multiple agencies. In his book on the financial crisis, ‘Jimmy Stewart is Dead,’ Boston University Professor Laurence Kotlikoff counts over 115 regulatory agencies for financial services.”
Tony,
You’re preaching to the choir and I agree with everything you’ve said. I simply use “campaign finance” as a shorthand for the systemic problem because that’s where the rubber meets the road. The revolving door mechanism is the axle driven by the corporate funding transmission that’s hooked up to the engine of fascist greed. I’d rather my daughter (if I had one) be a hooker than a lobbyist. Or a politician for that matter. It’s at least an honest sale of services transaction.
@Buddha:
Campaign finance is a problem, but probably less than half of the problem. The real problem is more insidious: Lobbyists that can be paid unlimited amounts of money by the rich (including corporations), allowing lobbyists to earn millions per year. They do not earn this by being wonderful negotiators. They “earn” this by being examples to sitting politicians of what can be had after retirement, if they play ball with the corporations represented by the lobbyists.
The campaign finance deals are just a downpayment on the cushy retirement guarantee. And it is a guarantee; because the rich almost never throw ex-pols under the bus. The millions they pay is a small price to pay for 15% capital gains tax instead of 30%, for the exemptions from monopoly for the insurance companies, for the infinite number of government contracts and grants for research, for the extensions to patent protection and for the right to sell $500 hammers and $10 screws and to charge 10 times the market rent for government offices. It is a small tax for the perks, and if it is paid to distasteful traitors, they don’t care.
If you look up almost any retired Congressman or Politician, they are getting rich as lobbyists, or running (like Newt) some political action committee funded by corporations, or working for some think-tank where their undisclosed salaries are reportedly $500K a year, or in some cushy job as a VP in charge of lookin’ good and strutting for sitting congressman. Serve five or six terms as a corporate lackey and retire in luxury.
THAT kind of graft is completely legal and requires no explicit agreement. It is executed (or can be, for the intelligent) completely by example. Don’t screw the big guys, and you get to use their corporate jets and credit cards at will.
I’ve said before so I’ll say it again. Big, small? Whatever. That’s a distraction argument, Byron. The only valid metric for government is functionality. In our case, functionality as constrained by the Constitution. Size is irrelevant if a system is broken. Our system is indeed broken, but size isn’t the problem. Graft is the problem. Corporate graft relabeled for public consumption as “campaign finance”.
So come on. Tell me again how it’s not the corporations fault and they wouldn’t pay this money if Washington wasn’t handing out favors. I need a good laugh.
I have no desire for a dictatorial government whatsoever; what I want is a government that enforces fair treatment of individuals.
I have never said I thought all people have equal abilities or equal attributes; that is patently false. Some are beautiful, some are ugly. Some can act or sing or play killer basketball, others can not, or choose not to do so. Nothing wrong there.
I have no problem with private property or gun ownership either. My problem is with oppression and exploitation. I don’t much care what people think or feel in terms of racism, homophobia, misogynism or the exclusion of the handicapped or whatever. It is when they act on those thoughts or feelings to oppress a target group that I get mad. You can use private property how you want, to a LIMIT: When you use your guns or your private restaurant or private factory to oppress others, I think that is when you must be restrained, or fined, or if necessary, your property must be taken away.
The same goes for corporations; like the health insurance agencies, banks, and car manufacturers and any monopoly. Defrauding and endangering people should be crushed. Period. I have no problem with them earning a profit; earning a profit by lying or tricking people is wrong. Everybody knows it is wrong, and they should be forced out of business for it. Earning a profit by getting your customers to rely upon you and then blackmailing them if they don’t blackball a competitor (as Microsoft did re Netscape) is wrong. Everybody knows it and they should be put out of business. Letting ANY business get too big to fail is, in my eyes, a crime, it is a license to oppress.
I am not for big government or small government, I am for a government that recognizes basic science, that promotes competition between providers based on product and service and quality ALONE, that does its job of protecting the weak from the strong. Not to favor the weak, but to equalize the playing field. Whether the strong are the wealthy, or physically stronger, or own more property or whatever, I think it is the government’s job to level the playing field and prevent people from exploiting others.
I don’t think that prevents private property, I don’t think that prevents voluntary adult prostitution, or people practicing their religion, or gun ownership, or anything else in the Constitution.
It would prevent segregation or refusing to serve a race of people. It would prevent firing people for being homosexuals. It would permit homosexual marriage by the state. It would not force churches to perform homosexual marriages.
Oppression of the poor, or minorities, or the physically weak or the crippled or the mentally disabled or the powerless is wrong. I think any government that purports to be ON BEHALF OF THE PEOPLE must punish oppression of the weak by the strong; whatever form it takes, including theft and all the various forms of assault.
None of that vitiates this logic:
Government is necessary to prevent anarchy.
All forms of government are rooted ultimately in coercion – the ability to discourage unwanted behavior and in some cases the corollary to encourage desired behavior.
The prevention of anarchy is required for the continuation of civilization.
The continuation of the individual and their rights INCLUDING PROPERTY RIGHTS cannot exist without a government to protect them.
The continuation of civilization and the guarantee of individual rights INCLUDING PROPERTY RIGHTS are both good and necessary.
Ergo, coercion is a necessary component of government to ensure the rights of the individual and to ensure those rights do not grow so expansive as to threaten the lives and rights of others INCLUDING PROPERTY RIGHTS. To that end, coercion is both moral and ethical. Your rights end where others rights begin, INCLUDING PROPERTY RIGHTS.
The right to property is not absolute, Byron. No matter your wishful thinking.
Tony C:
what if man is a social animal and he depends on others? What has that got to do with anything? So based on that statement someone has got to be in charge.
You seem to put a lot of stock in a dictatorial model of government.
The founders did not say that all men have equal abilities/attributes only that they have the equal right to their own life. That was their starting place. The savage has no concept of individual rights or the idea of self ownership. It is the tribe, the group that must be sustained at the expense of the individual.
This is what Locke and our founders wanted to prevent, they also wanted a form of government that would allow humans to be social animals within the confines of an objective set of rules that would guide their interactions. To do that they needed to start somewhere, so they chose the premises of rationality and self ownership. The rest stems from those 2.
The innocent savage in a pure state of nature does not exist. What is so great about living in primitive conditions sharing fish and coconuts and each others wives?