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ROSEN: Stimulating the welfare state
Published February 6, 2009 at 12:05 a.m.
Here's the opening paragraph from a New York Times story by reporter Robert Pear (please note that this is a news story in the oh-so-liberal New York Times): "The stimulus bill working its way through Congress is not just a package of spending increases and tax cuts to jolt the nation out of recession. For Democrats, it is also a tool for rewriting the social contract with the poor, the uninsured and the unemployed, in ways they have long yearned to do."
Reinforcing that assessment is this quote from White House Chief of Staff Rahm Emanuel: "Never let a serious crisis go to waste. What I mean by that is it's an opportunity to do things you couldn't do before."
It would be bad enough if HR 1, The American Recovery and Reinvestment Act of 2009 - a gargantuan $900 billion so-called economic stimulus bill - were merely an overblown accumulation of largely misdirected, politically motivated or wasteful government spending. Examples in the bill abound, like $50 million for the National Endowment for the Arts, $4 million for ACORN or $75 million to discourage cigarette smoking. But those items are nickels and dimes. Calling it "pork laden" is too kind.
When The Wall Street Journal correctly noted that only 12 percent of this spending can honestly be regarded as growth stimulus, it didn't mean that the rest was pork, the traditional definition of which is wasteful spending on local projects (like former Alaska Sen. Ted Stevens' infamous Bridge to Nowhere). To be sure, that kind of pork will be passed around liberally from HR 1's pool of funds going to states and cities. No, it's worse than that.
Jim Manzi calls it "The European Social Welfare-State Bill." While it's framed as an emergency stimulus bill, only 15 percent will be spent in 2009 and almost half is scheduled for 2011 and beyond. As revealed in the above quotes from Pear and Emanuel, the bill's grander, ulterior motive is to expand or create government social programs that will long survive the current economic downturn and be forever set in political concrete. This is the Democrats' "new" New Deal.
Once established, government "entitlement" programs - largely transfers of income from net taxpayers to net tax receivers - are almost impossible to roll back, much less repeal. As the legions of voters dependent on or addicted to such programs increase, the Democrats distributing these goodies plan to perpetuate their reign.
I'll concede that this isn't motivated solely by political opportunism, although that's the overriding factor for a good many career politicians. For those more ideologically disposed, it's simply the irreconcilable difference between the leftist vision of a government-run collectivist utopia, and the rightist vision of limited government, private property, individual rights, responsibilities and rewards.
In the current era of Euro- socialism, while leftist and (so-called) conservative governments have come and gone, the welfare state has survived and flourished. (Margaret Thatcher's UK government in the 1980s was an all-too-brief truly conservative interlude.) Unfortunately, whether in Europe or the United States, this game can only go on so long. At some point the diminishing fraction of net taxpayers is overwhelmed by the ever-increasing majority of net tax receivers. And that's when a welfare state implodes under its own unproductive weight.
For a preview of coming attractions, see the 2008 Financial Report of the U.S. Government, an official publication that recalculates the officially stated $10 trillion national debt to account for the unfunded liabilities of Social Security, Medicare, Medicaid and other entitlement programs (which President Barack Obama and congressional Democrats plan to expand). The restated debt figure becomes $56 trillion, which will worsen dramatically as our population continues to age and entitlement spending consumes more than two-thirds of the federal budget by 2030. There's no way tax collections (even on the rich) can keep up. I'll be watching anxiously to see if Obama and the Democratic majority in Congress will challenge this ghost of Christmas future.
Mike Rosen's radio show airs weekdays from 9 a.m. to noon on 850 KOA. He can be reached by e-mail at mikerosen@850koa.com.
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