Ticking Time Bomb Explodes, Public Is Shocked
By Robert Higgs • Wednesday September 10, 2008 2:14 PM PDT • 91 Comments
The 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. After all, what did people expect, that water would flow uphill forever?
This financial mega-mess is the same sort of event as the collapse of the USSR’s centrally planned economy, another economically unworkable Rube Goldberg apparatus that was kept going, more or less badly, for decades before it fell apart completely. Along the way, of course, famous (yet actually unsound) economists assured the world that everything was working out splendidly. As late as 1989, when the pillars were crumbling on all sides of the temple, Nobel Prize winner Paul A. Samuelson informed readers of his widely used textbook, “The Soviet economy is proof that . . . a socialist command economy can function and even thrive.”
In the future, we will see a similar breakdown of the U.S. government’s Social Security system, with its ill-fated pension system and its even more inauspicious Medicare system of financing health care for the elderly. These government schemes are fighting a losing battle against demographic realities, the laws of economics, and the rules of arithmetic. The question is not whether they will fail, but when—and then how the government that can no longer sustain them in their previous Ponzi-scheme form will alter them to salvage what little can be salvaged with minimal damage to the government itself.
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.
Each of these time bombs has at least one element in common: it promises current benefits, often seemingly without cost; but if it must acknowledge a substantial cost, it places that burden somewhere in the distant future, where it will be borne by somebody else. From the standpoint of society in general, every such scheme is a species of eating the seed corn. It satisfies the public’s appetite to consume something for nothing right now, with no thought for the morrow. It represents the height of irresponsibility by permitting people to live higher today than they can truly afford, financing this profligacy by borrowing recklessly and by taxing politically weak and ill-organized people in order to shower benefits on politically strong and well-organized special interests.
Call it democracy in action or utterly corrupt governance; they are the same thing.
The architecture of the Hotel of Impossible Promises is not arcane. All competent economists understand these things. Ludwig von Mises explained as early as 1920 why a centrally planned economy could not work as a rational system of allocating resources. The reasons why Social Security, especially its Medicare component, and many other such government programs contain the seeds of their own destruction have been explained time and again. Are the politicians who construct these structures really such idiots that they cannot understand the logic of what they are doing?
Not at all. But they are not striving to create economically viable institutions that serve the general public interest; they are feathering their own electoral nests in the only way they can in the context of our political institutions. As H. L. Mencken explained back in 1940, the politicians ”will all promise every man, woman and child in the country whatever he, she or it wants. They’ll all be roving the land looking for chances to make the rich poor, to remedy the irremediable, to succor the unsuccorable, to unscramble the unscrambleable, to dephlogisticate the undephlogisticable,” because they understand that “votes are collared under democracy, not by talking sense but by talking nonsense.”
And are members of the public so dense that they will fall for such promises? Yes. Moreover, they are greedy, impatient, and immoral, because the present benefits they hope to gain via politics, however unsustainable in the long run, come entirely at the expense of the taxpayers from whom the government extorts its revenues.
“Politics, under democracy,” Mencken wrote more than 80 years ago, “resolves itself into impossible alternatives. Whatever the label on the parties, or the war cries issuing from the demagogues who lead them, the practical choice is between the plutocracy on the one side and a rabble of preposterous impossibilists on the other.” And in a declaration even apter now than it was at the time, he concluded that what democracy “needs beyond everything is a party of liberty.”
The trouble is, however, that now, even more than then, the American people have little interest in liberty. Instead, they want the impossible: home ownership for those who cannot afford homes, credit for those who are not creditworthy, old-age pensions for those who have not saved, health care for those who make no attempt to keep themselves healthy, and college educations for those who lack the wit to finish high school. Moreover, they want it now, and they want somebody else to pay for it.
If you think that Fannie and Freddie’s bust is a big deal, just wait until Medicare comes crashing down. Then, the wailing and gnashing of teeth will be truly unbearable. As that day rapidly approaches, however, you’ll notice that the politicians are doing utterly nothing to forestall it.
Tags: Budget and Tax Policy, Economics, Elections, Healthcare, Housing, Politics, The State 
I agree that political incentives are usually twisted and harmful and we’re reaping what’s been sown.
Is there any political system that actually encourages legislation and policy that is economically sound?
If democracy is a dead end and dumbs us down, what are the better alternatives?
Paula Cassin | Sep 10, 2008 | Reply
Any system could theoretically work, the point is having a strong desire and deep understanding of liberty and virtue amongst the people. That’s the most important thing. Technical details are secondary.
Li | Sep 12, 2008 | Reply
> Is there any political system that actually encourages legislation and policy that is economically sound?
No.
> If democracy is a dead end and dumbs us down, what are the better alternatives?
Only a free market. No government.
Of course though, most people would just run away from such suggestions and hurry to shut their ears and eyes while spouting preprogrammed bull*it about absence of government equating endless chaos and violence.
But you have no choice.
You ARE in chaos.
You ARE in violence (taxes, wars).
And you ARE recognizing that the one political system which was supposed to be most liberty tolerant is an utter disaster. If it’s so hard for people to begin to realize that NO system involving a government (institutionalized violence) works, then by all means continue propagating the culture of self destruction.
Just don’t count on me giving you a hand.
Dumbed down indeed.
Danijel | Sep 12, 2008 | Reply
Great post.
Speaking of Samuelson, he just wrote an article for the Washington Post after seeing the movie IOUSA, where he decries the current presidential campaign, calling it an exercise in “fantasy politics”. Here is an excerpt:
“By all rights, we should be having a fierce debate over the role of government. What should it do, for whom and why? What can we afford? Who should pay? These questions would suggest a campaign that seriously engages the future. Instead, we have a bidding war between candidates to see who can promise the most appealing package of new spending programs and tax cuts.”
Seems reasonable, no? But where was Samuelson’s public support for Ron Paul when he was doing just that???
Paula asks: Is there any political system that actually encourages legislation and policy that is economically sound?
I would say no, but it is important to understand why, a la Bastiat’s The Law. I think we can rule out dictatorships as candidates for encouraging sound economic policy without explanation. When we get into electoral systems, it is clear that politicians will always be elected to do favors for certain groups of people at the expense of other groups. Once this is acknowledged, it becomes clear that they will never produce sound economic policy, if by that one means policies that are likely to promote what most would consider the public interest. Because sound policies, by their very nature, are ones that are just, and justice involves NOT arbitrarily giving preferential treatment to some while punishing others.
D. Saul Weiner | Sep 12, 2008 | Reply
What Bob Higgs doesn’t understand is that, as my Keynesian Econ. 101 prof explained in 1973 at the U. of Mich., “we owe it to ourselves.”
Oh, wait, now the ChiComs, still Chi but less Com than us, own our national debt.
Never mind.
John Seiler | Sep 12, 2008 | Reply
Well how much of the present dynamics are particularly American rather than democratic? It appears that other cultures exhibit more guardian instincts, prudent, thrifty and more future oriented, e.g. Australia, New Zealand and Singapore. Here in New Zealand the central government has been running moderate to large budget surpluses non-stop for the last 15 years, resulting in low government debt, high government assets and high government net worth. Australia has near zero government debt and healthy public finances and has had private savings privately managed old age pension/superannuation system in place since about 1990, as has Singapore since much earlier (and much higher savings and contribution rates too). Perhaps the Norwegians are something like the above, blessed with oil wealth as well. Saudi Arabia is also running huge government surpluses, again oil related.
American culture is brash, gung-ho, and in government these qualities bring the problems complained about by this author. British culture is more conservative, prudent, cautious, moderate, polite etc. and it shows in government too.
Of course this isn’t so much a criticism of American culture as of government as a channel for its outlet.
David Hillary | Sep 13, 2008 | Reply
That’s a different Samuelson. You’re speaking of Robert Samuelson, who writes for the Post, not Paul Samuelson the economist (who is mentioned in this article).
Paul | Sep 13, 2008 | Reply
Call me Chicken Little. I’ve been on the soap box proclaiming the economic sky is falling. Most folks would rather watch the game. The fact, in a nutshell is that we’ve been living large and spending money we don’t have at an exponential rate for about 100 years. we have roads, highways, welfare, healthcare, boats, planes, PCs and MACs, microwave ovens, two TVs per household, two cars, little league, “free” education, we’re growing a nice little global empire, minimum wage, a forty hour work week, and life is grand. The problem is that we’re spending wealth, (not to be confused with Federal Reserve Notes), which we haven’t yet created. No matter what the economic prestidigitators in DC try to tell you, in the real world the books will always balance. Either you do it voluntarily, or the laws of economics eventually do it for you. That is where we are today. It was fun while it lasted, but now somebody’s got to pay the tab. We can’t just wish it into Neverland. We’ve been on an monetary bender and now its time to pick up the empties and suffer through a well deserved economic hangover.
Bryan Morton | Sep 13, 2008 | Reply
David Hillary asks how much of what we are seeing is American versus democratic per se. A very good question. I think that there is a tendency for a government that considers itself “top dog” to be arrogant and take actions which turn out to be very destructive. We have seen the same phenomenon in many companies that were once dominant. However, there are many democracies which are in bad shape, so we cannot consider it a purely American phenomenon. England was in very bad financial condition a few decades ago, in spite of British character. Singapore, it seems to me, is somewhat of an anomaly. Let’s give Australia and New Zealand credit for what they are doing, but I have to wonder if their governments will continue to thrive and be prudent after the commodity boom from which they are benefiting has run its course.
D. Saul Weiner | Sep 13, 2008 | Reply
It very simple and always been very simple. “As you would have done unto you do likewise to others”. The Word of the Living Lord whom America has forgotten and mocked.
John | Sep 13, 2008 | Reply
D Saul Weiner,
Well NZ has little natural resources to speak of, unlike Australia’s bounty, most NZ commodity exports are agricultural rather than mineral. Anz NZ has been running much bigger government surpluses in the last 7 years than oz (3-6% of GDP).
David Hillary | Sep 13, 2008 | Reply
The saddest part of this is that Joe Lunchbucket American rube will blame this on CAPITALISM.
NO....this is the lassitude of the American electorate coming home to roost.
I am forty and I am REALLY P*SSED at the BOOMERS who have run our government and thereby have run our society into the ground. Its all about “MEMEMEME and what is government going to do for ME?”
It makes me sick. AMERICA will cease to be a Super Power IN MY LIFETIME.
Where are the mobs with the pitchfirks, you ask? Oh, they are in the barn...suckin’ on the TEAT!
seejanemom | Sep 15, 2008 | Reply
There is an alternative. Economics has come a very long way since Adam Smith. We can now show overwhelmingly and scientifically that not only is government unnecessary, but it is the most uncivilized, backwards, violent, destructive institution ever conceived. The most central aspects of human affairs, namely law and protection, can actually be provided by the market in high quality and low price instead of being perverted and used as a weapon by the government monopoly. We do not need to be robbed and violated by the government monopoly, humanity has a bright and brilliant future if it can just wake up to these facts. Educate yourself in
Austrian economics and educate others. Now is the time to throw off the leeching political class and declare your individual sovereignty. Good sites:
http://www.lewrockwell.com
http://www.mises.org
the_liberator | Sep 15, 2008 | Reply
You ask “what’s an alternative to democracy?”. How about asking “what’s an alternative to government”? What is with the preoccupation over how we are ruled. Is it not preferable to have no rulers at all?
JayPee | Sep 15, 2008 | Reply
It is difficult to even imagine a government that isn’t constantly dibbling and dabbling with interventionist measures that make our lives worse... and (at the very least) gradually expanding the interventions over time to the point where liberty is unrecognizable.
Brent | Sep 15, 2008 | Reply
When our legislature was composed of public spirited folks who sacrificed to serve and relied on their own means of support we muddled along pretty well. Now our legislators have created the political class where jobs in the legislature are nearly unassailble and can thus be handed down within families. Term limits would go a long way toward ending this if made short enough as public spirited people could afford to serve.
Will Cochran | Sep 15, 2008 | Reply
Its called “Free Enterprise”. It works literally everytime its tried.
Joe Johnston | Sep 15, 2008 | Reply
There is a bibical text relative to this subject. The people wanted a king, God told them, ok, but he is not to gain possessions, the people are to provide for his needs and that is it. This was established, but soon violated. Todays leaders the focus is about themselves and what they can aquire, not about serving the people. This can change, but is not very likely.
brian | Sep 15, 2008 | Reply
fantastic discussion of new Zealand’s turnaround at the Hillsdale College Imprimis archive: http://www.hillsdale.edu/news/imprimis/archive/issue.asp?year=2004&month=04
Robert | Sep 15, 2008 | Reply
I believe some people do things for all of the wrong reasons. If people truly answered to a higher power within their hearts, they would hold themselves more accountable. Trustworthiness would be something necessary for them to possess instead of a position of power, which is very fleeting. I have my eye on the goal line and I pray, when I take my very last breath, my Lord will ask me to come to Him and I will listen. How will these people be able to face themselves on judgement day. They will have many regrets. These politicians need to do their jobs for all the right reasons, with truth and honesty, not deceit and greed.
Angelique Anderson | Sep 15, 2008 | Reply
Forgive that I’m a little rusty it’s been a while since I reviewed our Constitution, but as I recall the founding fathers saw the role of our Federal government as foreign affairs, paving roads, delivering the mail and conducting wars — PERIOD.
There are without question other areas of this great and expansive county in which the Federal Government needs to insert itself, but only within the wisdom and spirit in the Constution. And as I recall the Constution says nothing about Taxes, Social Security, Universal Health Care, Welfare, redistrution of income, etc. many of which are great and heart felt ideas on paper, all of which are unsustainable economically and instantly bastardized, over regulated, way too expensive for services delivered by the very bureacrates put in charge, to say nothing of rife with potential corruption and favoritism (check the tax code lately?)
The oder you smell is not today’s free lunch, but the collective wallets of the majority of our population buring. If we don’t stamp out the fire out soon, there’ll be no wallet left and we’ll all be selling apples in the street and riding the rails to Hobo towns again — or maybe even speaking Chineese or some Middle Eastern dialect.
Lance Golden | Sep 15, 2008 | Reply
incredibly well said. to compliment you further would be superfluous. and wordy, too.
sean | Sep 15, 2008 | Reply
The Democrats under the Carter and Clinton administrations caused this by mandating that financial institutions issue loans they knew would never be paid back, and to economic segments that couldn’t afford them.
Mike | Sep 15, 2008 | Reply
I agree with Will Cochran. Term limits for our Senators and Congressional Representatives would be a good beginning towards removing the political class. Yes, it would be extremely difficult to force this down the throats of those so entrenched, but I believe that it can be done if enough consistent and overwhelming pressure is exerted by the constituency.
Mike Carbonara | Sep 15, 2008 | Reply
tHANKS FOR SUCINCT VERBAGE TO MATCH YOUR PICTURESQUE SPEECH
MAE CLARK | Sep 15, 2008 | Reply
It’s time to start killing people.
Stephen W. Carey | Sep 15, 2008 | Reply
THANK YOU FOR THE SUCCINCT VERBAGE TO DESCRIBE THE GLOBAL PERSPECTIVE YOU SHARE EVERY WKDA!
DO CONTINUE & DROP A HINT FOR US TO DO OUR PART FROM TIME TO TIME.
MAE CLARK | Sep 15, 2008 | Reply
Lance Golden’s comment is correct. Our Constitution makes us a Republic, not a Democracy. But we are acting like a Democracy because we are ignoring Amendment 10 coupled with Article 1 Section 8. If we “stayed the course”, we would not have these problems. We need Constitutional Judges for something bigger than Roe vs Wade!
Mike Van Schoiack | Sep 15, 2008 | Reply
Actually our founders had a great system working fine until our politicians ammended the Constitution to provide for the transfer of wealth via the 16th ammendment providing for direct taxation. The beginning of the end. It’s repeal and the fair tax are the only way out. Term limits won’t even solve this mess of wealth confiscation.
Give me liberty | Sep 15, 2008 | Reply
I would submit to you all...Look at who crafted the ss act along with the 16th amendment and nearly (but not all) the social reforms that we can attribute to the demise of liberty. I can hear the ghost of good ole Jeff Davis humming Dixie. Can you say.. the South is rising again and it is about to take the Union down...Think I’m whistling Dixie?...LOOK for yourself...I was amazed when I did. From Clinton’s mentor (Sen Fulbright..cosponser of the Southern Manifesto) back to Sen Doughton (sponser of the Social Insecurity Act) the Dixiecrats have been realising their forefathers racist and yes, socialist dreams.
Dan Wood | Sep 15, 2008 | Reply
there is an alternative. however, most are prejudiced against it due to the misuse of its name and misunderstanding of its true implications.
that “political” system is free-market anarchism. What? Anarchism you say? Yes. Volunteerism. Anarcho-Capitalism. Freedom. Liberty.
There are numerous volumes that have been written on the subject, outlining legal theory under anarchism, to protection (law and order), road building, etc.
For a grand start, check out Murray N Rothbard’s “For a New Liberty.” You can download the audio book here:
http://mises.org/media.aspx?action=category&ID=87
It is relatively short and easy to comprehend. Other books on the subject of “police” and “self defense” (the main sticking points when people consider the absence of a State) include Anarchy and the Law and the Enterprise of Law.
A warning though, the talking heads on CNN won’t spoonfeed you this information. You have to search for it and digest it yourself. Once you do, you’ll never think about the government the same again...
-e
edward | Sep 15, 2008 | Reply
Yes, Paula, there is a government system that works: It is called anarcho-capitalism–Free market anarchy. Start out at http://www.strike-the-root.com. Yes, anarchy means no central government. No, it does not mean licentiousness, or no rules, or chaos. In fact, it is the most productive way of achieving civilization, harmony and peace.
Paul the Cab Driver | Sep 15, 2008 | Reply
I don’t know which group are bigger idiots, the socialists or the libertarians.
Has it never occurred to some of you that the fact that there is no statist solution to human problems means that there is literally no statist solution to human problems? That means that, “I can fix the problems by doing X to the government”, regardless of what X is, is a false proposition.
Secondly, one of the big problems with socialism is that it proposes to protect the poor by turning over all private property to those with public power. The result of course is only to make the disparity in power between the powerful and the weak that much greater. Did it never occur to anyone that if the reverse was done, turning over public power to those who hold the majority of private property, that fundamentally the same institutions would be created? Oh, but you say, that under your institution, there wouldn’t be any public power. Where do you think that it would go? Do you think that it would just vanish? You are guilty of the same niavity as those communists that thought property would just vanish if you banned it under the law.
The fundament cause of these sorts of economic crisises isn’t law or institutions, but personal morality. Once a civilizations ethics and integrity collapses, there is no fix. You can’t build a civilization of any sort without a foundation.
celebrim | Sep 15, 2008 | Reply
Nations with small populations and many natural resources have advantages that very large nations don’t.
That being said, American’s do not save money money very well (and have very high material expectations) and neither do their politicians. Combine this with the percieved (and mostly good intentioned) duty throughout the second half of the 20th century to outspend Russia on defense and protect the world from communist aggression (without which we would not be in nearly the debt we are now, if at all) and it’s easy to understand why we have such problems funding our social institutions.
However, I think you will see that in the next 50 years, as European populations age, you will start seeing the same sorts of problem in the larger European nations, including England.
Chris Green | Sep 15, 2008 | Reply
I have to say celebrim’s states, flat out, the bottom line.
His/her final line is absolutely true. “Once a civilizations ethics and integrity collapses, there is no fix.”
Hard work, integrity, absolute honesty and families where children can focus on education without distraction and where parents have the time to make education and discipline a priority are absolutly necessary for any nation to prosper in the long run.
Chris Green | Sep 15, 2008 | Reply
Nice article painting looming gloom and doom; I’m Gen X and depressed that I’m going to live through those oft-quoted Chinese “interesting times.” No thanks to FDR for really juicing the rot and the boomers who’ll bring the crash they furthered. What worries me most is when Uncle Same turns the printing presses on and all the USD I have saved is made worthless.
Roger Godby | Sep 15, 2008 | Reply
Excellent article. The next crisis will not be Social Security or Medicare but state employee pension systems which are woefully underfunded.
JB | Sep 15, 2008 | Reply
Interesting stuff – let’s see, the Founders were rather explicit during formation of our Republic – GOD & Country. Why you ask, capitalism breeds the very things all of you mention, Power & Greed! How does one combat these evils, by having a Moral Code. Religion (Jesus Christ – sorry) was ALL ABOUT servitude not selfishness.
Since we continue to remove God from any / all public places & major documents, we promote the notion of recklessness, meaning it’s no longer about WE but ALL ABOUT ME!
Simple enough, look at your currency and you’ll see a scale because these brilliant minds knew the dangers. Hence they created a balance to keep things in check along with the 3 branches of government to watch each other (this isn’t working too well either).
If we continue on this path we will eventually suffer the same fate as the Roman Empire. Let’s hope folks heed the clarion call that now sounds & demand our politicians to act responsibly in the public interest – NOT THEIRS!
Matt | Sep 15, 2008 | Reply
I don’t know that the genius of the American system was really democracy, but limited government with limited powers, and a responsible class of people running the whole thing. If you compare the 20th century expansion of government and the creation of these unsustainable programs with the origins of the republic, I think we were a lot better off when the franchise was limited to male property owners over thirty.
Will | Sep 16, 2008 | Reply
@Paul:
According to “The Making of Modern Economics”, as well as every other source available on the web, that quote is indeed due to Nobel Prize winner Paul Samuelson, and not his son who writes for the Post.
source: http://books.google.com/books?id=QV2OJqbt45oC&pg=PA416&lpg=PA416&dq=%22a+socialist+command+economy+can+function+and+even+thrive.%22&source=web&ots=D-W1m0dhHB&sig=BlV8sPpYRd0JSHINafpopOz_6fU&hl=en&sa=X&oi=book_result&resnum=1&ct=result
Bill Mill | Sep 16, 2008 | Reply
The consensus of most commenters seems to be that the solution is either anarchy or God. If that’s what you think, good luck with that.
For those who would like a reality-based solution instead, try reading Ayn Rand. (See http://www.aynrand.org.)
Dana H. | Sep 16, 2008 | Reply
Ethical men, personal responsibility, and a belief in an absolute truth (that some things are always right, and some things are always wrong) are what is missing from our country right now, and what is causing this financial mess.
Ches | Sep 16, 2008 | Reply
Wow dude, that is sooooo intellectual; I’m speechless. I think you should go live in Iran where Theocracies prevail and thought does not.
Mike | Sep 16, 2008 | Reply
The American people should demand an investigation,demand to know the truth of how this happened. Starting today the American people should start demanding “Fair Tax” or “No Tax”. There are many ways, we the people, can take back our country and we should start now!
Debbie | Sep 16, 2008 | Reply
Speaking for those of us capable of lucid thought and an ability to reason, we will once again trot out (might be an exercise in futility) the old saw about those who do not learn from history being destined to repeat it. We can see cause and effect and we know what is wrong. We tire however of trying to think of simple enough ways to explain things to the masses with sub-junior high school educations that would enlighten you enough to change your simple minds regarding your behavior. If this sounds rude or condescending, sorry... That being said, this still needs to be put to you yet again in hopes of a favorable reception... If you are incapable of understanding and following this response, stay away from the voting booth! If you can follow this but refuse to honestly acknowledge our present plight, stay away from the voting booth! If you do understand where we need to be when this is done, vote for those who will diligently work to return us to our roots as a nation and this time, make it impossible for congress to get their hands on the national check book. Further, look this up and pay attention... 2 Chronicles 7:14. There may still be hope for this nation. If you are still not willing to honestly look at where we are and where we are going, please take the time to look up your future... I hope you are wise enough to figure out where you can read about it... S. P.S. I hope my optimism is not also an exercise in futility... Praise the Lord and pass the ammunition!
Steve W. | Sep 16, 2008 | Reply
“Ayn Rand” Ah humunism at it’s worst and most defiled. Luck has nothing to do with the truth in the One True Living God. America has become the pawn of the ungodly and greed and every day in the news it is only confirmed more and more. Just as the Lord said it would be in the last days. “As in the days of Noah.” “You are wieried of your many consulars and those who abide not in the truth.” And “One reaps what one sows.”
James | Sep 16, 2008 | Reply
Its really sad that these economic programs by the government will fall apart like the soviet Union did. It makes me wonder if this country is headed the same way.
Tim | Sep 16, 2008 | Reply
This article was amazing. It says exactly what I’ve felt and feared for years.
Don’t sit around waiting for the Government to make your life work, people!
-If you can’t they surely can’t either. If you can, what do you need them for?
SteveO | Sep 16, 2008 | Reply
I’m an educator, not an economist, a business guru, or other great financial mind, but for years I looked at my meager paycheck and have wondered how other people do it. How does a person who makes as much money as I do afford a home, much less a large house, cars, vacations, and other things that I have denied my family? I was raised with traditional financial values of not owing people if you could help it. Save up and then spend, and don’t spend what you don’t have. I have been frustrated and angry with my situation since it seemed everyone else was pulling ahead. Was there a trick to it? Why didn’t others have to make sacrifices too?
I’ve watched the politicians talk about people not loosing their homes and I am again angered. These people who lived high on the hog, who spent and lived beyond their means should be made to suffer the price of their good time. And for the government to step in and help them with tax money taken from people like me, who have sacrificed to provide for our families enrages me to no end. It’s one thing to help a neighbor because you want to, and a completely different thing to have my hard-earned money taken to bail out the irresponsible.
The party has ended and those who danced have to pay the band.
Brandon | Sep 16, 2008 | Reply
“The Earth belongs to the living. No man can by natural right oblige the lands he occupied, or the persons who succeeded him in that occupation, to the payment of debts contracted by him. For if he could, he might, during his own life, eat up the usufruct of the lands for several generations to come, and then the lands would belong to the dead, and not the living.”
-Thomas Jefferson to James Madison, 1789
Jennifer Lau | Sep 16, 2008 | Reply
Why not just call them (the politicians) what they are –theives, liars, and traitors, everyone of them! And then face the fact that they have ALL turned against the people of this nation. We should not be at war with Iraq , we SHOULD be at war with those traitors ,thieves, and liars in Washington D.C. –Send them packing! ALL of them!
Steve | Sep 17, 2008 | Reply
Here’s the truth: America can easily afford to care for its elderly, sick and unfortunate. It can now, and it will do so in the future.
The voters know this, and they understand that theories to the contrary by the likes of the authors and readers of this website are just transparent attempts to justify your own greed and arrogance.
You have no idea what society will be like 50 years in the future. If the past is any guide it will be immensely richer than it is now, and these welfare costs will be trivial — although there will no doubt still be those like you deploring them as too high. Any price is too high for the wicked man who despises his fellows.
Thank the Lord America is a *Christian* country. (the Lord Jesus Christ, that is, not Mammon or any other so-called ‘higher power’).
Kip Watson | Sep 17, 2008 | Reply
Ugh. The government and politicians are the cause of all our problems. The free market will regulate itself. What a bunch of George Bush crap. I’m tired of libertarians like George Bush running this country in to the ground with their capitalism.
Good government policy can and has in the past, fixed our economic problems. Look at the Great Depression. Hoover and the capitalist criminals in his administration tried to fix the depression by lowering taxes and cutting government and that just made things worse. Roosevelt used government to help people out of the depression and save the country.
What we need is another New Deal, where government helps people by giving them jobs and houses to live. Where government gives people health care and gives people a good education. Then we will have a truly prosperous society. The truth is that Capitalist have destroyed our country and most every CEO in this country should be hanged for treason.
Xzavier | Sep 17, 2008 | Reply
Government incentives were designed by politicians to extract more freedom from the populus, transfer it to government power where it is never returned. Freedom is not in government as the politicians like to convince us! The greatest example in the history of mankind, the reality that a freemarket does work is being eroded. There is no ideal political system particularly when the old tenants of failed Marxist/socialist ideals are reintroduced. As long as politicians insist that government control and regulation is necessary all systems will fail eventually.
When true liberty and freedom are realized by all peoples to reach their potential by their hard work and desire to succeed without political governmental incentives, then nations grow. Ours is in decline and chaos will rule, if and until, we rebel!
Thomas | Sep 17, 2008 | Reply
Really? That must be satire.
Brandon | Sep 17, 2008 | Reply
I am referring to Xzavier’s post.
Brandon | Sep 17, 2008 | Reply
There is one form of government that is in harmony with human nature — kritarchy. See more at http://www.kritarchy.com. It does not create two classes of people, the rulers and the subjects, a state of affairs contrary to natural law. It understands both the greatness and the evil that humans are capable of, and is designed to simply keep peace within society, as far as that is possible. Everything else is beyond what government has any right to do.
kritarchist | Sep 17, 2008 | Reply
FDR instituted his predecessor’s big government ideas and cause a recession to become the great depression. It wasn’t until after WWII when the GI’s came home and married and bought those little homes that capitalism saved the American economy.
Try reading the Politically Correct guide to American History, but if you just wish to wallow in your envy/hatred of the rich mode, save your dime.
Don L | Sep 18, 2008 | Reply
The problem with most is, we don’t even know what type of government we have anymore. We have a constitutional Republic. I have heard it called a Representative Democracy, which makes no sense.
If we stick to the constituion then we don’t have these problems. Businesses fail. People fail or don’t plan at all. The role of government is to protect us from force and fraud. But who can get elected on the platform of “fend for yourselves” anymore.
Tim D. | Sep 19, 2008 | Reply
The problem is Socialism has been mixed in with our Republic’s capitalism. We are now Commie Lite. If the Democrats & “Moderate” Republicans would let capitalism work, all would take care of itself. The differnce between the parties as I see it is Democrats beleive in redistribution of wealth & reliance on government to take care of you womb to tomb-Marxist Communism. Republican’s beleive in the power of the individual to be respnsible for themselves & to be FREE,to be as successful as they desire & are willing to be. Capitalism works when it is not tinted pink.There will always be about 10% of the population that will be labeled “poor”. In this country it is very profitable to be poor-what other country’s poor have cell phones, & big screen tvs?
GLENDA G | Sep 25, 2008 | Reply
To Xzavier:
George Bush a libertarian??? WTF are you smoking?
BTW, the New Deal did NOT get us out of the Depression. WW2 did that. Go back and read history. Your simplistic socialist trolling is so utterly transparent. News flash for ya... it was the socialist, hand-wringing freebies that got us in this mess, not capitalism. Obviously you also need to read up on capitalism.
Go back to the Daily Kos.
John A | Oct 4, 2008 | Reply
To John A:
War (read ‘killing’) gets you out of depression?
WTF are YOU smoking?
grant reiner | Oct 11, 2008 | Reply
Modern birthright voting democracies don’t work. In short time burgeoning tax parasites end up outvoting taxpayers and you have a
welfare state with government taxing and spending 35-50% of GDP. Hobbled with this huge deadweight loss, you get Eurosclerosis with real GDP growth at best in the the 0-2% range. Facing a bleak future of tax slavery, the disgruntled populance bears fewer children. It’s a national death spiral.
Democracy only works when there is quality control on the electorate, something the U.S. had up to the 1960′s. The welfare state exploded shortly thereafter.
In contrast the ChIndia governments tax and spend 15% of GDP. Compare their economic growth to ours.
JR | Oct 19, 2008 | Reply
“War (read ‘killing’) gets you out of depression?”
Gets you out of *economic* depression, yes — at least sometimes.
The economic policies of FDR (the New Deal) did not work as hoped.
Indeed, the Depression was worse in 1937 than in 1933. WW2 forced the
US to shift focus away from social and economic engineering and the
market was allowed to recover on its own.
BTW, Roosevelt’s “New Deal” programs were so unconstitutional that
Roosevelt threatened to stack the court: increasing its membership from
nine to sixteen judges.
glroman | Nov 8, 2008 | Reply
NZ has a population about as big as a US state, which is more evidence in support of abolishing the US federal government.
heuristic | Dec 17, 2008 | Reply
Those who seek political office are, by definition, unworthy of it. Our Founding Fathers erred, we should Draft not Elect.
John | Jan 3, 2009 | Reply
Term limits would only encourage scorched-earth politics.
ANC | Sep 14, 2009 | Reply
The more of a welfare state we become, the closer to destruction we get. A hand out is just as addicting to cocaine. It feels so good to “make it” without working working your butt off. Why would anyone want to get off of it? I can’t blame the recipients as it’s worse when you get off of welfare. The entitlement mentality gets you going in a dependent direction and you eventually become a slave. That is not how one should live. One day you will waken to the whip of your master and only then will you realize you have lost one of your most precious thing...freedom.
Charlie at Gain Financial Freedom | Aug 17, 2010 | Reply