Wednesday, January 01, 2014
The redistribution of dreams
A friend is celebrating the season by visiting her children in the States. Like many millennials, her 20-something son is working brutal hours for minimum wage at an unfulfilling job. After visiting with him and his girlfriend, my friend emailed, "These kids are SO stuck in not being able to even pay their rent that they have no energy left to dream anything."
A similar story is playing out in family after family across America. Twenty-somethings are holding down two minimum wage jobs because no one wants to hire full-time people for whom they might have to provide health insurance. In a stagnant economy, their unemployment tops the chart. Meanwhile, they are saddled with debt and taxes for entitlements they will probably never receive, like social security.
As I moved through the day, my friend's words haunted me. They perched at the back of my mind as I read a New York Times article that was an odd combination of proclaiming the obvious and writhing to avoid it. One quote captures the dance: "These days the word ["redistribution"] is particularly toxic at the White House, where it has been hidden away to make the Affordable Care Act more palatable to the public and less a target for Republicans.... But the redistribution of wealth has always been a central feature of the law and lies at the heart of the insurance market disruptions driving political attacks this fall." The obvious: The core goal of Obamacare is the redistribution of wealth. The writhing: Obama lied, only he had to lie because of those wretched Republicans.
And, then, it occurred to me. It wasn't just wealth. The dreams and future of my friend's son have been systematically redistributed away over the last five years. As a white, male, 20-something, he is in a particularly hard-hit category of people. He is likely to work unfulfilling, low-paid jobs for as far in the future as he can see. And, as diligent as he may be, it is far from clear that he will be able to rise through merit.
From the onset of his presidency in 2009, Obama's domestic policies have revolved around distributive justice. That is, he uses the force of law to forcibly wrench wealth, political pull, opportunity and dreams themselves from those in so-called 'privileged' classes and transfer them to so-called 'disadvantaged' ones. As his popularity sinks, Obama is returning to the theme of redistributing wealth, which has been a vote winner among his constituents. On December 4, he delivered a speech that foreshadowed policy in 2014. The White House called it a speech on "economic mobility"; the press called it his "inequality speech." It was a call for egalitarianism, especially in terms of income and opportunities. In other words, a greater redistribution of wealth and further regulation to guarantee that everyone has access to money and upward mobility.
Of course, the word "egalitarian" was not used, any more than the term "redistribution of wealth" is used in connection with Obamacare. Of course, as with every theft that needs to sustain itself, the compelled transfer of wealth and opportunity is cast in noble language. An act of theft becomes compassion; the plunder becomes charity; giving one legal privileges becomes equality. The stealing will continue under the aegis of executive orders, a court ruling or the ballot box but no show of pomp can make it less of a crime. The ceremonies merely institutionalize the theft. The 19th century French classical liberal Frédéric Bastiat explained, "When plunder has become a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it."
The theft itself is vicious but focusing on the money misses much of the important dynamic. Much more than money is being stolen. Those who rip wealth and opportunity from people like my friend's son are reaching into their psyches and taking away their hope for the future and their belief in rising through merit. The alternative is a soul crushing poverty. Worrying about how to feed yourself or children, about having heat in the winter and whether you can survive a single bout of illness is psychologically exhausting. It can exhaust people to the point of breaking their spirit so that they lose hope. Anyone who has been truly poor knows that genuine dreams are a luxury item. Unlike escapism, dreams inspire you to reach out into the world and change it for the better. Without dreams, individuals and society become static and gray instead of exploding into color. And the role that wealth plays in people's ability to dream is invaluable. Wealth allows you to move beyond the need to spend your life working for nothing but money. It gives you free hours to write or read, to create something with your hands or mind, to experience life instead of survival.
The ideal of "equality" needs to be debunked. Everyone should enjoy equal protection of their person and property under the law. But the attempt to impose equality in any other level is social control and doomed to failure.
Consider the redistribution of wealth. Forcibly socializing wealth can only destroy it. Such wealth will be dissipated, wasted and consumed by self-interested bureaucrats in the process of transfer. But that isn't the main problem. The main problem is that egalitarianism (or strict equality) runs counter to the nature of wealth itself. People labor and create precisely because there is an incentive to do so; they trade effort now for profit later. To the extent they succeed, an inequality results because they are enriched by being rewarded for their productivity. This means they make more money than their neighbors.
But a financial inequality that comes from innovation and hard work also benefits their neighbors. Imagine daily life without computer visionaries like Steve Jobs or Steve Wozniak. They deserve every cent of their fortunes because the money was earned by improving the lives of the tens of millions of customers who flocked to buy Apple products. Many of the customers used those products to work more efficiently and so create their own independent wealth. The computer revolution was driven by profit and it created opportunities across society. But when equality is mandated by law and government privilege, society suffers because the innovators and dreamers have no economic incentive to labor or take risks.
Wealth is not created by government, only by individuals. The forced transfer of wealth from a producer to a consumer is not sustainable because the wealth will be quickly depleted and the consumption must be fed anew. Handing people wealth and opportunity does not free them; it creates dependency.
What creates independence is the one thing government of all stripes is loath to do. Get out of the way. History ascribes the term "laissez-faire" to a businessman named M. Le Gendre who reputedly met with the French finance minister Jean-Baptiste Colbert in 1680. The minister inquired on how to assist Le Gendre in commerce. The response: "laissez-nous faire," "let us be." It is the one thing government cannot do.
My friend's son deserves to live in a society where he can rise or fall on his merits. He deserves a world of unequal results in which people have reason to dream.
A parasite intent on killing its host
As the health care debate rages on, there is one reality that even the proponents of this hostile takeover of health care by government cannot ignore — and that is money. The government simply does not have the money for a new, expansive, public health care plan.
The country is in a deep recession. The last thing we need is for government to increase and expand taxes to pay for another damaging, wasteful program.
There are limits to how much government can tax before it kills the host.
Foreigners are becoming less enthusiastic about buying our debt, and creating another open-ended welfare program when we cannot pay for what is already in place will not help. Champions of socialized medicine want to tax the rich, tax businesses that already cannot afford to provide health plans to employees and tax people who don’t want to participate in the government’s scheme by buying an approved health care plan. Presumably, all these taxes are to induce compliance. This is not freedom, nor will it improve health care.
There are limits to how much government can tax before it kills the host. Even worse, when government attempts to subsidize prices, it has the net effect of inflating them instead. The economic reality is that you cannot distort natural market pressures without unintended consequences. Market forces would drive prices down. Government meddling negates these pressures, adds regulatory compliance costs and layers of bureaucracy and, in the end, drives prices up.
The nonpartisan CBO estimates that the health care plan will cost almost a trillion dollars over the next 10 years. But government crystal balls always massively underestimate costs. It is not hard to imagine the final cost being two or three times the estimates, even though the estimates are bad enough.
It is still surreal that in a free country, we are talking only about how government should fix health care, rather than why government should fix health care. This should be between doctors and patients. But this has been the discussion since the ’60s and the inception of Medicare and Medicaid, when government first began intervening to keep costs down and make sure everyone had access.
The result of Medicaid and Medicare price controls and regulatory burden has been to drive more doctors out of the system — making it more difficult for the poor and the elderly to receive quality care! Seemingly, there are no failed government programs, only underfunded ones. If we refuse to acknowledge common-sense economics, the prescription will always be the same: more government.
Make no mistake, government control and micromanagement of health care will hurt, not help, health care in this country. However, if for a moment, we allowed the assumption that it really would accomplish all they claim, paying for it would still plunge the country into poverty. This solves nothing. The government, like any household struggling with bills to pay, should prioritize its budget.
If the administration is serious about supporting health care without contributing to our skyrocketing deficits, they should fulfill promises to reduce our overseas commitments and use some of those savings to take care of Americans at home, instead of killing foreigners abroad.
The leadership in Washington persists in a fantasy world of unlimited money to spend on unlimited programs and wars to garner unlimited control. But there is a fast-approaching limit to our ability to borrow, steal and print. Acknowledging this reality is not mean-spirited or cruel. On the contrary, it could be the only thing that saves us from complete and total economic meltdown.
Democracy is majority rule at the expense of the minority. Our system has certain democratic elements, but the Founders never mentioned democracy in the Constitution, the Bill of Rights or the Declaration of Independence. In fact, our most important protections are decidedly undemocratic.
For example, the First Amendment protects free speech. It doesn’t — or shouldn’t — matter if that speech is abhorrent to 51% or even 99% of the people. Speech is not subject to majority approval. Under our republican form of government, the individual, the smallest of minorities, is protected from the mob.
Sadly, the Constitution and its protections are respected less and less as we have quietly allowed our constitutional republic to devolve into a militarist, corporatist social democracy. Laws are broken, quietly changed and ignored when inconvenient to those in power, while others in positions to check and balance do nothing. The protections the Founders put in place are more and more just an illusion.
This is why increasing importance is placed on the beliefs and views of the president. The very narrow limitations on government power are clearly laid out in Article 1, Section 8 of the Constitution. Nowhere is there any reference to being able to force Americans to buy health insurance or face a tax or penalty, for example. Yet this power has been claimed by the executive and astonishingly affirmed by Congress and the Supreme Court.
Because we are a constitutional republic, the mere popularity of a policy should not matter. If it is in clear violation of the limits of government and the people still want it, a constitutional amendment is the only appropriate way to proceed. However, rather than going through this arduous process, the Constitution was, in effect, ignored, and the insurance mandate was allowed anyway.
Our system has certain democratic elements, but… our most important protections are decidedly undemocratic.
This demonstrates how there is now a great deal of unhindered flexibility in the Oval Office to impose personal views and preferences on the country, so long as 51% of the people can be convinced to vote a certain way. The other 49%, on the other hand, have much to be angry about and protest under this system. We should not tolerate the fact that we have become a nation ruled by men, their whims and the mood of the day, and not laws.
It cannot be emphasized enough that we are a republic, not a democracy and, as such, we should insist that the framework of the Constitution be respected and boundaries set by law are not crossed by our leaders. These legal limitations on government assure that other men do not impose their will over the individual, but rather, the individual is able to govern himself. When government is restrained, liberty thrives.
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Posted by JR at 1:45 AM