Voice For Liberty

Category: United States government

  • Unlearning Roosevelt

    Writing in the July 8, 2007 Washington Post, George Will has a column titled “Declaration of Dependence.” The link to it is here, although you may have to register (for free) to read it.

    All through my public school education, we were taught that Franklin Roosevelt was godlike for saving the country from the Great Depression. While I don’t directly know what schoolchildren are taught today, I imagine that the stature of Roosevelt has only increased, as his vision of large, overpowering government is in perfect alignment with the goals of public schools. This is more that I need to unlearn.

    Some excerpts:

    Some mornings during the autumn of 1933, when the unemployment rate was 22 percent, the president, before getting into his wheelchair, sat in bed, surrounded by economic advisers, setting the price of gold. One morning he said he might raise it 21 cents: “It’s a lucky number because it’s three times seven.” His Treasury secretary wrote that if people knew how gold was priced “they would be frightened.” … In his second inaugural address, Roosevelt sought “unimagined power” to enforce the “proper subordination” of private power to public power. He got it … Roosevelt, however, made interest-group politics systematic and routine. New Deal policies were calculated to create many constituencies — labor, retirees, farmers, union members — to be dependent on government. … Before Roosevelt, the federal government was unimpressive relative to the private sector.

  • President Bush’s tax hike

    At the end of March 2007, President Bush raised taxes on Americans. How so? He did it by applying tariffs to imports of paper from China.

    The measure is supposed to help Americans, but all it does is hurt us. Donald J. Boudreaux’s column Paper Chase from the Pittsburgh Tribune-Review explains how this happens. A portion follows:

    The Bush administration recently raised Americans’ taxes.

    If you missed this item in the news, it’s because this tax hike isn’t described forthrightly by government nor is it reported forthrightly by the media. The tax hike I’m talking about is the higher tariff on paper products imported from China.

    “Tariff” is simply another word for “excise tax” — here, a levy imposed by government on each unit of some class of products bought domestically.

    Descriptions of higher tariffs, though, almost always focus on foreigners — such as a headline in this very paper on March 31: “U.S. to slap trade tariff on China.” But a more accurate headline would have read “U.S. to slap higher taxes on Americans buying paper from China.”

    The first, actual headline gives the impression of Uncle Sam imposing some burden on foreigners. And while a tariff does harm foreign sellers, its chief victims are domestic consumers. This fact is hidden by talk of tariffs as being something done to foreigners.

  • Reform the “other” welfare

    Writing from Little Rock, Arkansas

    A recent USA Today editorial (“Hooked on Handouts” July 31, 2006) makes the case for reforming corporate welfare, given the success of “regular” welfare reform:

    Most of what the government does could be called welfare, using a very broad definition of the word. It’s not hard to find individuals, corporations, states or communities hooked on one Washington handout or another. The result of this largesse is a society that is unproductively dependent on government support — and politically organized to keep it coming.

    Agriculture is a leading example. Supports have become a sad hoax on the U.S. taxpayer. According to a recent report by The Washington Post, the government has handed out $1.3 billion since 2000 to people who don’t even farm. It has sent billions of dollars in drought relief to areas where there was no drought. And, oh yes, it has paid out a staggering $144 billion over 10 years, according to the National Taxpayers Union, 72% of which went to the 10% of farmers with the largest holdings. Such spending is an insult to hardworking, unsubsidized, Americans. Wasteful farm programs should be cut.

    The federal budget is replete with hundreds of payments to, and tax benefits for, other politically potent industries. This “corporate welfare” ranges from government-funded logging roads to subsidies for electric utilities. Last year, according to the non-partisan Congressional Research Service, Congress earmarked 15,877 items worth $47.4 billion to specific recipients, many of them companies with well-connected Washington lobbyists.

    This not only squanders taxpayers’ money, it also clogs decision-making in the private sector. Rather than making a smart business decision promptly, companies wait to see whether they can make more by delaying and doing something that could be less sensible.

    With so much available in the form of government handouts, it is no wonder companies spend billions on lobbying, and that there are scandals.

    F.A. Hayek wrote in his book The Road to Serfdom: “As the coercive power of the state will alone decide who is to have what, the only power worth having will be a share in the exercise of this directing power.” Lobbying scandals are a symptom and manifestation of a government that has too much power and spends too much time rewarding one person at the expense of another.

    Is there a solution? Can we persuade the rewarded class to give up their spoils? The economist Walter E. Williams relates this story and solution: “Nearly two decades ago, during dinner with the late Nobel Laureate Friedrich Hayek, I asked him if he had the power to write one law that would get government out of our lives, what would that law be? Professor Hayek replied he’d write a law that read: Whatever Congress does for one American it must do for all Americans.”

    It could be that simple.

  • Rep. Todd Tiahrt and BTK

    Congressman Todd Tiahrt has secured $1 million for use by the Wichita Police Department in the omnibus appropriations bill that goes before the House of Representatives on Monday.

    The bill has already passed the Senate, Tiahrt spokesman Chuck Knapp said, and approval by the House is expected to be a formality.

    While there are safeguards in place to make sure the money is used for certain purposes, Knapp said, “we’re just not able to comment on the details of the funding.” — From “BTK ‘clues’ breed theories” in The Wichita Eagle, December 2, 2004.

    Here The Wichita Eagle reports that U.S. Representative Todd Tiahrt secured one million dollars from the federal government to help pay for costs related to the investigation of the BTK serial killer. Rep. Tiahrt was widely praised for this.

    We should remember where that money came from. It didn’t fall out of the sky. It wasn’t free. It came from the taxpayers of the entire country. I suspect that many people in Wichita thought it was good that we got the nation as a whole to pay for the BTK investigation.

    But think about what had to happen behind the scenes. Rep. Tiahrt must have lobbied for the money. Then the federal government collected tax money, only to send it back to Wichita. That, right there, is inefficient. A bureaucracy had to exist to perform that.

    Then, of course, Rep. Tiahrt and Wichita aren’t the only ones looking for a federal handout. When other cities or states receive money in this way — a special payment to one locality for a special project — we in Wichita call it pork barrel spending. That’s exactly what Rep. Tiahrt engaged in to get us the money for BTK. He should be ashamed, and we should not laud him for it.

  • Missing From the Social Security Debate

    This is what I haven’t seen mentioned in the debate over the future of social security.

    Opponents of private accounts cite the risk inherent in investing in markets. Instead, they will rely on future generations of workers to pay the taxes necessary to pay promised social security benefits.

    It seems to me, though, that investments in U.S. securities markets, both stocks and bonds, derive their value from the underlying strength of the U.S. economy. If the economy does well, in the long run, markets do well. If the economy does not do well, the investments will not do well, and social security recipients will need to rely on a future generation of workers to pay taxes that will pay benefits.

    Where do these taxes come from? They come from workers, hopefully earning high salaries to pay the high taxes that will be needed. But if the economy does not do well, there will not be very many highly-paid workers, and the government may have trouble collecting enough taxes to pay social security benefits.

    So we need to hope that the U.S. economy performs well, so that private accounts earn a high return, or there will be workers earning enough to pay high social security payroll taxes.