STEYN: Beleaguered taxpayers may finally put a stop to the sheer waste of government spending
http://www2.macleans.ca/2010/05/27/were-too-broke-to-be-this-stupid/
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A vigorous political blog, not for the fainthearted.
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Back in 2008, when I was fulminating against multiculturalism on a more or less weekly basis, a reader wrote to advise me to lighten up, on the grounds that “we’re rich enough to afford to be stupid.”
Two years later, we’re a lot less rich. In fact, many Western nations are, in any objective sense, insolvent. Hence last week’s column, on the EU’s decision to toss a trillion dollars into the great sucking maw of Greece’s public-sector kleptocracy. It no longer matters whether you’re intellectually in favour of European-style social democracy: simply as a practical matter, it’s unaffordable.
How did the Western world reach this point? Well, as my correspondent put it, we assumed that we were rich enough that we could afford to be stupid. In any advanced society, there will be a certain number of dysfunctional citizens either unable or unwilling to do what is necessary to support themselves and their dependents. What to do about such people? Ignore the problem? Attempt to fix it? The former nags at the liberal guilt complex, while the latter is way too much like hard work: the modern progressive has no urge to emulate those Victorian social reformers who tramped the streets of English provincial cities looking for fallen women to rescue. All he wants to do is ensure that the fallen women don’t fall anywhere near him.
So the easiest “solution” to the problem is to throw public money at it. You know how it is when you’re at the mall and someone rattles a collection box under your nose and you’re not sure where it’s going but it’s probably for Darfur or Rwanda or Hoogivsastan. Whatever. You’re dropping a buck or two in the tin for the privilege of not having to think about it. For the more ideologically committed, there’s always the awareness-raising rock concert: it’s something to do with Bono and debt forgiveness, whatever that means, but let’s face it, going to the park for eight hours of celebrity caterwauling beats having to wrap your head around Afro-Marxist economics. The modern welfare state operates on the same principle: since the Second World War, the hard-working middle classes have transferred historically unprecedented amounts of money to the unproductive sector in order not to have to think about it. But so what? We were rich enough that we could afford to be stupid.
That works for a while. In the economic expansion of the late 20th century, citizens of Western democracies paid more in taxes but lived better than their parents and grandparents. They weren’t exactly rich, but they got richer. They also got more stupid. When William Beveridge laid out his blueprint for the modern British welfare state in 1942, his goal was the “abolition of want.” Sir William and his colleagues on both sides of the Atlantic succeeded beyond their wildest dreams: to be “poor” in the 21st-century West is not to be hungry and emaciated but to be obese, with your kids suffering from childhood diabetes. When Michelle Obama turned up to serve food at a soup kitchen, its poverty-stricken clientele snapped pictures of her with their cellphones. In one-sixth of British households, not a single family member works. They are not so much without employment as without need of it. At a certain level, your hard-working bourgeois understands that the bulk of his contribution to the treasury is entirely wasted. It’s one of the basic rules of life: if you reward bad behaviour, you get more of it. But, in good and good-ish times, who cares?
By the way, where does the government get the money to fund all these immensely useful programs? According to a Fox News poll earlier this year, 65 per cent of Americans understand that the government gets its money from taxpayers, but 24 per cent think the government has “plenty of its own money without using taxpayer dollars.” (by the way, who do you think this 24% voted for, if they voted?) You can hardly blame them for getting that impression in an age in which there is almost nothing the state won’t pay for. I confess I warmed to that much-mocked mayor in Doncaster, England, who announced a year or two back that he wanted to stop funding for the Gay Pride parade on the grounds that, if they’re so damn proud of it, why can’t they pay for it? He was actually making a rather profound point, but, as I recall, he was soon forced to back down. In Canada, almost every ethnocultural booster group is on the public teat. Outside Palestine House in Toronto the other week, the young Muslim men were caught on tape making explicitly eliminationist threats about Jews, but c’mon, everything else in Canada is taxpayer-funded, why not genocidal incitement? We’re rich enough that we can afford to be stupid.
It’s not so much the money as the stupidity, which massively expands under such generous subvention. When it emerged that President Barack Obama had appointed a Communist as his “green jobs czar,” I carelessly assumed it was the usual youthful “idealism”: no doubt Van Jones, the Communist Obama appointee in question, had been a utopian college student caught up in the spirit of ’68 and gone along for the ride. A passing phase. Soon grow out of it. But, in fact, Mr. Jones became a Communist in the mid-nineties, after the fall of the Soviet Union. He embraced Communism after even the commies had given up on it. Like the song says, he was commie after commie had ceased to be cool. On Fox News, Glenn Beck made a fuss about it. But the “mainstream” media thought this was frankly rather boorish, and something only uptight right-wing squares would do. I mean, what’s the big deal? True, everywhere it’s been implemented, Communism causes human misery—not to mention an estimated 150 million deaths. But it doesn’t make you persona non grata in the salons of the West. Quite the opposite. The Washington Post hailed the grizzled folkie Pete Seeger as America’s “best-loved commie”—which, unlike “America’s best-loved Nazi,” is quite a competitive title. Even so, why would you stick a commie in the White House and put him in charge of anything to do with jobs, even “green jobs”?
Well, because “green jobs” is just another of those rich-enough-to-be-stupid scams. The Spanish government pays over $800,000 for every “green job” on a solar-panel assembly line. This money is taken from real workers with real jobs at real businesses whose growth is being squashed to divert funds to endeavours that have no rationale other than their government subsidies—and which would collapse as soon as the subsidies end. Yet Tim Flannery, the Aussie climate-alarmist who chaired the Copenhagen racket, says we need to redouble our efforts. “We’re trying to act as a species,” he says, “to regulate the atmosphere.”
Er, “regulate the atmosphere”? Why not? We’re rich enough to be stupid with the very heavens.
In his book The Tyranny of Guilt: An Essay on Western Masochism (La tyrannie de la pénitence), the French writer Pascal Bruckner concludes by quoting Louis Bourdaloue, the celebrated Jesuit priest at the court of Louis XIV, who preached on the four kinds of conscience: 1) the good and peaceful; 2) the good and troubled; 3) the bad and troubled; 4) the bad and peaceful. The first is to be found in Heaven, the second in Purgatory, the third in Hell, and the fourth—the bad but peaceful conscience—sounds awfully like the prevailing condition of the West at twilight. We are remorseful to a fault—indeed, to others’ faults.
It’s not just long-ago sins like imperialism and colonialism and Eurocentric white male patriarchy and other fancies barely within living memory. Our very lifestyle demands penitence: Americans have easily accessible oil reserves, but it would be wrong to touch them, so poor old BP have to do the “environmentally responsible” thing and be out in the middle of the Gulf a mile underwater. If you’re rich enough to be that stupid, what won’t you subsidize? The top al-Qaeda recruiter in Britain, Abu Qatada, had 150,000 pounds in his bank account courtesy of the taxpayer before the comically misnamed Department for Work and Pensions decided to cut back his benefits.
The green jobs, the gay parades, the jihadist welfare queens, the Greek public sector unions, all have to be paid for by a shrinking base of contributing workers whose children and grandchildren will lead poorer and meaner lives because of the fecklessness of government. The social compact of the postwar era cannot hold. Across the developed world, a beleaguered middle class is beginning to understand that it’s no longer that rich. At some point, it will look at the sheer waste of government spending, the other shoe will drop, and it will decide that it no longer wishes to be that stupid.
Again, Mark - thank your Republican brethren for the debt. Reagan & GWB supply side tax cuts produced $10T of debt. President Clinton and the 1993 Budget Bill (w/o one Republican vote) balanced the budget and produced a large surplus. GWB came in and with a GOP Congress cut taxes and created a new prescription drug entitlement and not one penny to pay for it.
If Bush had delivered a surplus to Obama, as he had received from Clinton, we would still be in surplus. As I told Dr J many times early in Bush's term, "Tax cuts now mean higher taxes later." Well - later is here.
In your absence, Mark, I have challenged the board's conservatives to identify what spending they would cut to balance the budget without raising taxes. Apart from vague platitudes without any price tags from the Good Doc, and lots of talk about "a start", nothing has been produced. What would you cut to balance the budget and how long would it take before you saw your first surplus?
No, unfortunatley Mark, we are not.
Greek Disease in the House
By Larry Kudlow
One day Team Obama announces a plan for enhanced rescission authority to impound wasteful spending, and the next day the House surfaces a plan for $200 billion in "stimulus" spending on transfer payments for welfare, even more unemployment compensation, still more Medicaid and a bunch of special-interest subsidies.
So are we to believe that President Obama will rescind the excess appropriations? Hardly. And since pay-go is dead, most of this new spending will not be offset. It will add to deficits and debt.
It's the Greek disease. The welfare state run amok. Right here at home.
And in true class-warfare style, a small portion of the $200 billion is supposed to be offset by jacking up capital-gains taxes for investment partnerships. If passed, this would reduce investment, jobs and economic growth, and enlarge the deficit. Higher spending and investment taxing is a true austerity trap.
Larry Kudlow. Really?
Kudlow's complaint about "raising the capital gains tax for investment partnerships" is specious. Right now, "carried interest" is taxed at the capital gains rate when it should be taxed as ordinary income. Congress is simply eliminating an egregious loophole.
Returns on capital are subject to the capital gains tax. Returns on labor, of which carried interest is a product, are supposed to be taxed as ordinary income. The existing tax loophole is a prime example of monied interests receiving favorable treatment in the tax code.
Larry is brillant.
How do you not get this? We can't tax our way out of this mess, we need to cut back our promises.
The biggest mistake Bush made was not addressing spending, taking too many off the tax rolls and adding entitlements.
He should have use the veto much more.
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