This review ran last August, but because of pressures of work and the relevance this important book has to our upcoming elections, it’s time for another look. Regular posts resume soon.
I
This will not be a book your progressive friend will buy for himself. Thus in the true spirit of benevolence, you must buy it for him and, as an additional service to humanity, circle all the naughty bits so that they are easier to find. And there are plenty of them. Your progressive friend may think this is the smuttiest book since Reflections on the Revolution in France.
Benevolence is a virtue, one that has been riding at the top of the progressive charts since the eighteenth century. The idea that all that matters is the “greatest happiness of the greatest number” triumphed
partly by the elimination of rival candidates. It laughed or shamed almost every other virtue out of court. The “monkish virtues,” as it called such things as humility, chastity, and obedience, were the principal victims. But the military virtues (such as courage), the feudal virtues (such as loyalty), the patriarchal virtues, the feminine virtues, and others all suffered the same fate.
Benevolence is the attitude of deep caring and smug self-satisfaction that allowed, for one example from a near infinite number, marketer Kenneth Cole to issue the advertisement “What’s wrong with shoeing the homeless?” and think it a rhetorical question.
What’s wrong with it is that if you give “relief” to those that are poor, by programmatically and coercively taking from those that are not, and thus also creating an administration to store and allocate these confiscations, you do one (temporary) benevolent thing, but at least three harmful things.
The benevolent thing is easily seen: the poor person who receives the shoes, bread, house, video games, car, shopping cart, clean needles, etc., etc. is obviously immediately better off than before he had these things. It is that immediate and visible change of circumstance with which the benevoloent credit themselves and which fills them with pride and self congratulation.
But the harm that is caused, which as Eliot says the benevolent do not see or in which they are not interested, is far greater. First, it encourages those that are not poor to think that they needn’t work as hard as they otherwise would, because they have a “safety net” waiting to catch them. Those that are receiving “relief” are scarcely have the impetus to better themselves. “Widespread poverty cannot be relieved from the outside and, therefore, can relieved (if at all) only by industry, self-reliance, and prudence of the poor themselves.”
Of course, it is sickening to modern ears, in fact absolutely intolerable, to hear talk of “industry,” “improvidence,” “idleness,” or the like. In 1989, not one person in fifty can hear such words without shame and indignation.
Second, the money that is taken from those that earned it are worse off (but, we are told, they can “afford it”). Except that the money that was theirs is now in the hands of the government and not allowed to circulate in the hands of citizens. This always and necessarily contributes to economic stagnation.
And not all the “rich” are rich. The taxes taken from those who are just above poor (but not officially poor) necessarily make these marginal people poorer (by taking money from them and from reducing the amount that could have been given to them by the richer job creators), and thus they are likely to become officially poor, which a good many of them do. These new people added to the welfare rolls were caused to be put there by benevolence. And there many of them will stay. The “gap” between the rich and poor necessarily increases under the welfare state (these are not necessarily the same people as under the welfare state). These are outcomes which “could easily have been predicted in advance by anyone who possessed elementary knowledge of human nature, and who was not blinded by benevolence.”
This negative feedback was first identified by Thomas Malthus in his argument against the Poor Laws, a form of official government benevolence not unlike our current welfare policy and corporate “bailouts.” Malthus insisted that the fraction of the populace on the poor roles must increase and that the taxes paid by those not yet there must also increase. All this came to pass, exactly as predicted. But even though it was perfectly obvious that it must happen, it mystified the benevolent, who sought (and still seek) to pin the blame everywhere but on themselves. For them, it is axiomatic to them that possessing a love for humanity (but rarely individual humans) could not cause harm.
Which brings us to the third consequence of benevolence: an increase in government, coercion, control, mindless bureaucracy. Which, we now know, when unchecked leads to death camps, broken families and loneliness, mass starvations, gulags, coercion, firing squads, and glowing reports in the New York Times. Community or equality of property is ever promised to lead a betterment of mankind, but which in fact always leads to a worsen-ment of actual people.
II
Given that, in democracies, people tend to elect those who promise them the most, and given the experience of government growth in Europe and the United States, we can ask how likely is it that terror governments like those that arose in China and Russia will occur in the West.
Francis Fukuyama famously predicted that we are at the “End of History”, in the sense that all Enlightened people agree that liberal democracy is the last word in governance, that no superior system exists or can exist. But how can that belief be reconciled with the observation that the West is sliding towards “enforced” (a redundant term) socialism? Why are our intellectuals not frightened by this?
All of us Enlightened (or so near to all of us as to make no difference) still share the Enlightenment’s estimate of benevolence as the highest virtue. We are all enthusiasts for the relief of poverty and the equalization of wealth. We are all still, on balance, enemies of the bourgeois family. In addition, we all know that the communists, at bottom, are impelled by benevolence, and are even firmer friends to equality of wealth than we are, and firmer enemies of the bourgeois family. How, then, could communism not be an object of indestructible goodwill among us Enlightened?
Yet the Chinese willingly gave up a fraction of power when they allowed ordinary citizens to run their own businesses. All within narrowly proscribed limits, of course, and limits which are sometimes tightened and sometimes loosened in a whimsical fashion. But it remains true that some power was ceded.
The Soviet Union collapsed, Vietnam saw the light of freedom, and the feeling in Cuba is that once old man Castro dies “change we can believe in” will finally occur.
Stove sees these as “wobbles” in the inexorable course towards totalitarianism. The Soviet Union did collapse, but because it was exhausted in its battle with countries that were still free and not because the nomenklatura saw the folly of benevolence. So what happens when the enemies of totalitarianism cease to be enemies and embrace it? Stove says, “I do not think the welfare state will be dismantled, and still less that communism will be. Indeed, I think that both communism and the welfare state will continue to grow.”
Further, the welfare governments of the West
are elected by universal adult franchise; but an electorally decisive proportion of the voters—in some countries, approaching a quarter—either is employed by government or is dependent to a significant extent on some welfare program. In these circumstances it is merely childish to expect the welfare state to be reduced, at least while there is universal suffrage. A government that did away with free education, for example, or socialized medicine simply could not be re-elected. Indeed, it would be lucky to see out its term of office.
The only things holding up back from falling over the cliff immediately are two things: innovation, which must slow the more control government assumes, and birth control (abortion and contraceptives), which slows the growth of number of the poor. But only to a point: many of those unborn would have contributed to innovation and to the taxes which pay for the services to the elderly. A demographic crunch point is coming to countries like Italy, Japan, Ireland, and the remaining PIGS where there will be too many people to be taken care of and not enough people to do the caring.
What should we, the non-benevolent, do? Stove recounts finally the story of a solitary Indian in a canoe fishing miles upstream from Niagra Falls.
Despite all his local knowledge, he makes some slight misjudgment of time, or wind, or water, and finds himself surprised by the current. For hours he puts forth all his strength in trying to reach the shore, but long before the fatal event itself, he passes a point at which his diminishing strength, and the increasing strength of the current, make further resistance vain. He then ships his paddle, lights his pipe, and folds his arms.
In the circumstances, those are the actions of a rational man. Similarly, in my opinion, the world-current of Enlightenment benevolence is now so strong, and we have been launched upon it for so many years, that we passed the point of no return a long time ago, and will, if we are rational, emulate the Indian in the story.
Stove was an old man when he wrote that, while your author is (relatively) young. So I say fight the current.
III
Stove did not finish this essay before his death. Readers familiar with his other work will notice the lack of polish, and even a few rough spots in his argument, flaws which Stove never allowed. If this review convinces you to buy and read the book, consider that real treasure awaits you in Stove’s other writings. I cannot recommend strongly enough that any scholar of statistics, probability, and philosophy of science should buy immediately The Rationality of Induction (the second half of that book is about probability and logic). General readers will want to grab at least On Enlightenment and Against the Idols of the Age (edited by Kimball); both are collections of essays.
Fully half the current book is taken up by an extensive bibliography of Stove’s writing. What a tremendous boon for Stove scholars! (I’m thrilled to have this.) But how off-putting to those who have never heard of the man. Let’s hope that Mr Kimball and Encounter Books consider bringing out Stove’s essay in a broadside, a format re-embraced by that company, after sales of the hardcover flag.
Read Stove while you are still allowed.
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What is a virtue for the individual is not a virtue for the government.
If Kenneth Cole wants to shoe the homeless and raises the price of his shoes by a few dollar to fund his project, do i really have grounds to complain? I am not obligated to by those shoes. Or, I can wear down the soles of my existing shoes one more month to afford the increase in costs.
What burns me, is a line of logic that has come up in recent debates. It is “evil” to cut a subsidy, hand-out, program that already exists. It seems that the poor are being compared to that cat that came to your back yard and you once gave a can of tuna. The cat keeps comming back. But, if you give him tuna regularly, are you obligated to feed this cat for life because, he has become “depenandant” on your tuna?
Doug,
You have a duty of care for the cat, but you are supposed to force your neighbor to provide the tuna. You demonstrate your moral superiority by doing good at somebody else’s expense.
Everything needs balance. As Marshall McLuhan pointed out, things tend to morph into their opposite.
Look at Christianity. Its organized versions have often morphed into things that were vile and hateful. That doesn’t mean Christianity is wrong or evil. Freedom is our highest ideal but anarchy doesn’t work for long. etc. etc. (lots of examples)
IMHO, people who lack benevolence are sub-human. OTOH, institutionalized benevolence usually produces its opposite. A welfare system that keeps generations shackled to welfare is hardly a good thing.
One of the problems with institutions is that the bureaucrats take over. They really don’t care about the big picture, they just want a set of rules they can enforce. Their rules can’t possibly encompass the compassionate caring that is necessary for real benevolence. That failure does not mean that benevolence is wrong.
“I leave it to youse as an exercise to connect the dots.” (apologies to the Dogfather http://muppet.wikia.com/wiki/Bugsy_Vile)
Stove apparently was an atheist, but well read enough in theology to absorb some understanding about human nature. It isn’t hard to see how “benevolence” is charity (in the old biblical sense) corrupted by the first transgression – Pride. The Good Book is full of wisdom in this vein: “there are none so blind as those who will not see” and “if a man will not work, neither should he eat.”
Is it a sin to have benevolent thoughts?
Gary,
good def. of “benevolence” or at least of what “benevolence” really means when applied by the smugly elite.
Q: does one really need to be well read in theology to absorb understanding of human nature or can one do that by simply being human?
It is very simple:
If you want more of something, subsidize it.
If you want less of something, tax it.
I’m not sure how to rearrange our laws, but subsidizing behavior that is clearly detrimental to society is the road to ruin.
Dagnab it, there, Matt, you kept wearing me down and now I’ve gone and done it. Idols of the Age… is presently en route. Will you quit it, please? Old minds don’t e-x-p-a-n-d as painlessly as yours.
Stove doesn’t suggest that malevolent and apathy be the way to a better government, does he? A good intention can be carried out many ways, so when a certain method doesn’t yield satisfactory results, is it the fault of the good intention?
Positive liberty vs Negative Liberty.
This is not newsworthy, mr. Briggs. This discussion has been had for a long long time. Of course, what lacks in your discussion is the notion that this Negative Liberty is a very strange form of liberty, a vision of the world that was spawn by the likes of the Rand corporation and Game Theory. A vision where humans are robots who have desires that are atomised and incomprehensible to the political power. A vision where politics is the enemy. A vision where the rule should be the one of the jungle.
It is no coincidence that this decadent vision of liberty that you espoused has brought about the crash of 2008. It depends upon the diminished definition of what is to be human into a simple logical biological body that will behave rationally to any input of data. Never mind that every behavioral economic study shows that the only people who actually behave like those models are either economists themselves… or psychopaths.
A brand new world.
There’s nothing wrong with benevolence. What is described is not benevolence. Like hospitality or love, benevolence cannot be compelled since it is an impulse in some individual. You can billet soldiers on me but that doesn’t make me hospitable. Nor is forcing others to manifest the outward appearance of benevolence benevolent either. I approve of giving help to the needy but only when I do it myself. If I’m mugged by the Government which then gives to the needy then I stop caring about the needy and get angry that I’ve been mugged.
The problem with “progressives” is not benevolence per say but that they desire to be benevolent with other people’s money (OPM(tm)).
To make things worse, the supply of OPM tends to run out long before the progressives dessire to be benevolent with OPM.
The most un-christian, abhorrent notion that everyone who is without money, who is at real pain in the society “fully deserves it”, and if he is unemployed, it is solely because he didn’t “work hard enough”. Why bother then blaming Obama and any other politician for the unemployment, if we can determine its cause from the sheer lack of interest from these self-absorved, pathetic losers of the society?
This is the worst form of political ideology that the USA has ever created and a true source of poverty in your country.
It comes as a parody in itself when one realises that the percentage of taxes on the american people is the historical minimum ever.
One other bad thing governmental benevolence does is rob individuals of the duty and joy of personal charity, an act that creates human relationships to the betterment of both the giver and the recipient. Beyond the material transfer, there is something spiritual going on that is missed by food stamps and no-charge health care.
Luis,
Your comment about the “worst form of political ideology that the USA has ever created” is a non sequitur (not that you have to stay on topic) and nonsensical to boot.
Taxes are currently low for a number of reasons, including the fact that if you aren’t working you aren’t paying! Nevertheless, it’s not all about taxes, and non-tax governmental interference is certainly pretty high and getting higher.
I just cannot imagine the train of thoughts that went from, “work hard in order to get out of poverty” to “a true source of poverty.”
(The 11:33 comment is mine)
Luis,
The terms Positive Liberty and Negative Liberty exist nowhere in the article or in anyone elses comments.
Define these two terms (I think I know what you intend but I want to be sure before commenting).
Since your comment specifically references the US, cite an example of each from either the US Declaration of Independence or the US constitution.
Matt:
Positive, negative, it is simple.
Positive liberty is expressed when I am on the receiving end: when I host a dinner at $ 40,000 per plate.
Negative liberty is everything else, particularly when it is the opposite of the above.
Positive liberty forms a bedrock of positivism. It is a specific optimistic attitude towards people, life and the world in general derived from neo-definitions of common ideas ( I refuse to split the hair and argue that some of those ideas may be now un-common). Lets consider private property: it is AT THE SAME TIME private and public. And this is positive !
Mr Briggs,
The arguments in this post are very weak.
1) « First, it encourages those that are not poor to think that they needn’t work as hard as they otherwise would, because they have a “safety net†waiting to catch them. Those that are receiving “relief†are scarcely have the impetus to better themselves. »
This argument is demonstrably false.
Which life would anyone choose? Would you prefer to be rich like Mitt Romney and own 6 houses with 11 bathrooms and 11 bedrooms or to live in a decrepit apartment in a noisy city?
My guess is that most people would prefer the life of Mitt Romney than any other one.
Do you really believe that someone working for minimum wages isn’t working hard? Do you really think that rich people work harder than poor people?
The first source of wealth is through inheritance. Romney is Rich because his father has gotten rich before him. Yet is father received welfare at some point. Did it make him work less hard to better himself? No, he worked to develop is company.
Is father was also lucky enough to make is money at a time where there was plenty of opportunity, at a time when the majority of people were getting richer, a time when companies invested in American workers instead of Chinese workers. Between 1945 and 1970, on average people were 4 times richer; meanwhile between 1980 and 2010, on average Americans have grown pourer while the richest people got a lot richer. There has been no growth in average American income while the top 1% have seen their income grow by 240%.
Between 1945 and 1970, companies were investing in America, salaries were going up and more and more people could afford to buy product which created jobs. How many cars, houses, appliances will buy someone who makes $1 million/year; 1 or 2 of each. Meanwhile how many cars, houses, appliances will people who makes $50,000/year buy; all of them. Which one is more profitable having the maximum of people that can buy houses and cars that are a bit smaller or only a few people who can afford bigger cars and houses?
What was the rate of taxes in the period of 1945 and 1970; much higher than todays, yet everyone was getting richer not only a small part.
2) How many people lost their jobs in 2008 because Wall Street mismanaged the money that was given to them? They didn’t lose their jobs because they didn’t work hard enough. They lost their jobs and even some their pension. These are the people that receive help from the government now. By the way they lost their pension and the fund managers received huge bonuses for losing billions of dollars. Do fund managers worked harder than the people who lost everything putting their confidence into them?
3) Who else receives government help, the elderlies who have paid taxes all their life, the veterans who are treated like shit by the country who sent them to war? In some cases soldier have been charged for equipment they lost in battle where they were injured. Some received no help at all because they were injured in truck accidents where they were passengers instead of combats.
4) There is also the work requirement to receive help from the government i.e. people need to work to receive food stamps, etc. They need this help because their employer doesn’t pay them enough for them to survive on their own. Food stamps are really a subsidy to companies.
5) There are also many companies who receive subsidies (about $250 billion/year) from the government, and that even if they make billions in profit like AT&T, Exxon, and many others.
Finally, many of the 47% of people who receives money from the government will vote for Romney instead of Obama this include many elderlies and veterans. And BTW that 47% of people is not always the same. The percentage might be but many will find a job and some will lose theirs. Most people will receive welfare for a short period of time, unless they have some handicap.
MattS,
“Two concepts of Liberty”,
http://en.wikipedia.org/wiki/Two_Concepts_of_Liberty
I could have quoted instead the clash between Keynes and Hayek, but I held the audience in high consideration.
Sextus, stop wasting your brain in such malfunctions.
@Sylvain Allard,
You are talking to the wind. These people don’t care. They know the Truth, and the Truth is that everything that is governmental is bad and coercive, therefore it should be destroyed. Every politician that tries to create a healthcare system is a Hitlerite, every attempt to create a better redistributive system is communism. Nevermind that it has been shown again and again and again that the best healthcare system is the single payer system, nevermind that everyone knows that the wealth people have has only a small correlation with their “hard-workingness”, it doesn’t matter.
America is going down the hole of the inequality singularity, with the likes of Romney gathering billions, nay, trillions (dontchaknow they work a thousand times harder than you?), while the government is mismanaged by republicans into constant deficits (and then they complain that the government is unmanageable, we should ditch it!), safety nets discarded as “luxury for the non-working assholes”, poverty rising by the millions solely because of the Democrats and their unwillingness to work as hard as they do.
You are going down, America. Have a nice trip.
The last two comments remind me the famous statement directed to Americans and capitalism in general in 1961 by Nikita Krushchev: “Whether you like it or not, history is on our side. We will burry you”.
Oh, that romanticism…..
Luis,
Wow. You’d think that if the 20th century taught us anything, it was the failure of central planning.
Yes, sadly America is going down. Even worse, the rest of the developed world is ahead of us, and I suppose we’ll catch up soon enough the way things are going.
Of course, the evil handmaiden of benevolence (as defined in this post) is envy, on which Sylvain seems to have a good handle.
This article doesn’t make any sense to me. If the author were serious about the virtues of everyone earning his own wealth strictly from his own industriousness, and the pernicious effect of any kind of wealth redistribution or “handout,†no matter how paulty, then the most important handout we would have to eliminate to create a level playing field is inheritance — a sacred pillar of the system – and everything related to it, so that everyone would have to truly start out from the starting line. And that includes eliminating all educational and upbringing privileges stemming from one’s family’s means. I doubt this would sit well with the proponents of “inherent industriousness†as the sole source of personal wellfare, even though the institution of inheritance makes a complete mockery of the very ideas they purport to espouse regarding cream making it to the top by its own means, etc.
For the record, I don’t propose the idea that inheritance and related cushions ought to be eliminated. I am simply pointing out that those who begin life’s marathon with, say, a 10 mile headstart, are curiously prone to dislike the idea of anyone giving a pair of shoes to those who begin at the starting line. God forbid. That would spoil them.
Louis,
That is a different definition of positive liberty than I have seen before in actual use. For the most part, where I have seen that term used, it is used to express the concept of things society must provide for the individual. In this form that is how I am used to seeing the term used, positive liberty is no liberty at all, but a duty imposed on others.
I would not argue that there necessarily should not be any kind of safety net. However, you have to understand that if that safety net is too generous relative to work at the bottom end of the econnomy it incentivses people who could work to refrain from looking for work.
One could argue about whether the government is the best provider of that safety net vs private charities.
With un-employment benifits, many studies have been done (no, I don’t have a cite off the top of my head) have shown that most people on unemployment benifits won’t even start looking for work until their benifits are about to run out. So extending the durration of benifits only keeps people unemployed longer.
MattL, only Siths deal with absolutes. Are you a Sith Lord? If the 20th century teaches anything is that “central planning” as used by communist countries is an abysmal failure. But it also teached us that “central planning” as in planning things like the police, education, national healthcare systems, firefighting, and so on is pretty damned good. However, it seems that once people figured out that “free markets” worked, they obviously inferred that they ought to work “everywhere”. The expression “market failure” doesn’t exist in their brains, it’s like a communist conspiracy or something. For these people, the problems in the 2001 and 2008 crash was the government interaction, and nothing to do with Gordon Geckos let loose throughout all the scales of the system.
MattS, that is indeed the definition of “positive liberty” to which I alluded to. The inventor of that expression is Isaiah Berlin in that lecture whose wikipedia page I linked to references.
And yes, all those are debatable.
Francisco, completely spot on.
It’s the duty of all these rich people to consider they earned the money they inherited through all the hardship their golden infancy forced them to go through. And to let everyone else understand it as well. The poor who started as poor and are inevitably doomed to be poor for the rest of their lives are just genetically inclined to be so, can’t you see?
Let them eat cake.
MattL,
I’m not sure what your line of workis.
Last year I was fired for having a non responsible accident with a company truck which was insured. The reason was that since I had an accident I would cost more money (about 200$ for a year)to insure.
Meanwhile, fund managers of which funds my dad had invested his pension in, and lost about 20% of it in 2008, received over $2 billion in bonuses for having lost the money invested by thousands of people.
An employee makes a «mistake» that cost the company $200, he lose is jobs. An exeutive makes a mistake that cost billions of dollars he receives a million dollars bonus and complain that he pays to much taxe. Of course, everyone play by the same rule.
Francisco,
I do not think the article is arguing what you think it is.
There is however, a significant difference between being generous with one’ own money and using the force of government to be generous with Other People’s Money (OPM).
There are several dangers to benevolence by OPM.
Those who enact these programs care about neither the cost nor the effectiveness of the programs, only that they themselves feel good for having been benevolent. Thus they enact programs that are very costly and ineffective and all are harmed.
All organizations are vulnerable to perverse incentives but government is more vulnerable than private enterprise. Every government program enacted to fix any problem outside of government itself is filled with perverse incentives. The mid and upper level managers are paid according to the size of their budget and number of employees. Their incentives are not to actually succed at the mission they were given, but to make the problem worse. If they solve the problem the program was created to solve then they can end up out of a job but if the problem get’s worse then they can argue that they need a bigger budget and more employees.
This isnt about the morals or intentions of government workers, it is about the incentives built into the system.
The next danger is in creating a dependent class. The problem here is not in welfare itself, but in the level of benifits and incentives built into the system. For those at the bottom end of the economy, if the benifits of welfare are greater than the jobs available at the bottom of the economy, the incentive is to not work rather than to find a job.
This creates a dependent class that will of course vote for whomever is most generous with OPM.
What happens to this dependent class when the government runs out of OPM as it inevitably will? Look to Greece to see what happens. The picture isn’t very pretty.
To hold these incentives in check, and wealth redistribution benifits must be less valuble than the worst job in the economy. Any thing more than this and you are subsidizing people not working and you will always get more of what you subsidize.
Unfortunately the government benifits already available are higher than the benifits to working at the bottom of the economy.
This all creates a vicious cycle where pollitions and the beurocracy work together to increase benifits, the dependent class grows and votes in more pollititians to further grow the entitlements.
The whole thing will snowball until either a politictian gets into office with the guts and political will to scale back benifits to sustainable levels or the supply of Other People’s Money runs out.
Greece is what happens when the supply of Other People’s Money runs out.
Matt,
I remember how in the early 2000 I had a discussion with a friend about the debt. Back then (before the Bush tax cut), the USA per capita debt for the federal only was around 20k. That amount is now $51,000 per person federal only.
In Quebec a vile socialist state the amount is stable at about 47k while it is lower in GDP percetange (it went from 70% to about 35%).
So the USA is pretty much following Greece.
Why has the debt gotten so much worst «The Bush tax cut», 2 war and fear.
The Bush tax cut were supposed to create job, instead it has doubbled the debt in the last 9 years since they are still in in place.
In the last 9 years the top 1% as gotten a lot richer while millions of people lost their jobs. The top 1% a suppose to be job creator yet where are the jobs.
Their are subsidies given to companies to the amount of $270 billions the vast majority of these companies are pilling up huge profit. Why does companies who are pilling up profit even receive subsidies.
How many peoples on WallStreet lost anything since 2008, while millions of hard working American have lost everything since 2008 because of WallStreet gambling their money away.
If their is work people will work.
Matt,
And real bulls*t is the result of trying to come up with examples one has no real clue about. The problems of Greece (and other PIGS countries) have nothing whatsoever to do with what you are trying to bang on about on how the poor are being so well treated in such “communistic” countries. As a matter of fact, Germany FYI has a much better “safety net” than anything Greece has ever provided, and it is in a much better shape than Greece. Consider Canada, Denmark, Netherlands, France, etc.
Self-evidently, all those examples should be enough to make people that think like you do to stop and consider whether or not you are actually saying something not nonsensical.
The problems of Greece have much more to do with (not only pegging but actually substituting) one’s currency with an economic zone’s one to which one’s economy has stopped being synchronized to.
The problems these countries face are the result of a terrible mismanagement in a flawed monetary policy when the Euro was created. I can develop to you the problems in very precise detail, but the first thing we must do in order to start that conversation is for you to stop uttering nonsense: The fall of Greece has nothing whatsoever to do with its NHS (for example).
Yes, the problems we are trying to solve today in our economy is the poor having it so good. I mean, it’s like you buried your head in the sand for the past 4 years now.
Luis,
A big problem with education in the US is the centralized planning of it. Also the grip of the unions, who leverage the centralized nature of it to their advantage and the kids’ disadvantage.
I will agree that there are things that seem best provided as public goods (fire, police, roads come to mind).
The big difference between a market failure that happens as a result of private actions and government actions is that the private failures are self correcting. A government failure, on the other hand, usually results in more of whatever caused the failure in the first place. Without government actions, 2008 would have been a much smaller problem. More likely, things would have failed on smaller scales far before we got to that point.
Also, I certainly don’t see the evidence of central planning of health care as being superior. The way we finance health care in the US is definitely pretty awful, but it hasn’t stifled innovation and investment to the extent that national health care has in other countries (e.g., pharmaceuticals). It always amazes me to hear what people outside the US believe about US health care.
Louis,
When did I say anything about the poor having it good. Becomming dependent on government handouts isn’t good.
You haven’t refuted a thing I said.
On Greece, I didn’t say their problem had anything to do with the absolute level of benefits. Their problem is that they were running their government and economy on other people’s money. The fact that they were getting other people’s money from other Europen countries.
This does not change the validity of what I said. They have riots in the street because they have been forced to cut back benifits due to the fact that they have been cut off from the supply of other people’s money they have been running theri government on for years.
There is good evidence from the experience of some of the smaller South and Central American countries that they wouldn’t necessarily be able to print their way out of their problems even if the did get off the Euro. This could lead to hyper inflation putting them right back where they are now.
My comment on the depenent class was not about them having it good. It was about the relative values of government benifits and work at the bottom of the economy. Why would any inteligent person at the bottom of the economy get a job when government benifits pay better than the jobs do? It was not about how good they have it but rather about the incentives the system creates.
Matt,
You have some misunderstanding about Greece problem. From what I read the biggest part of their problem was that many people found a way to not pay there taxes thus reducing the revenue of the government and the need to borrow money. The situation has gotten worst after 2008 when people started losing their jobs and needed government help.
Greece is a little bit similar to the USA since the main reason of the growth of the US debt is the refusal by the federal government to collect taxes necessary to its function and engage in two wars without having them paid for.
Sylvain,
Tax receipts are down in the US because of the crappy economy. But even before that, we were spending too much.
The Greeks took advantage of the easy money based on Eurozone declarations of sovereign debt being risk free, even for the basket cases. Yes, they definitely have a tax avoidance problem, but for reasons waaaaay beyond the US’ depressed tax receipts.
At least there is some hope that the US economy can improve and reduce the massive deficits and shrink the debt to GDP ratio.
Matt,
Actually, the federal government had already lost about $4 trillion in revenu while adding $1 trillion before the economy had gotten crappy. The crappy economy just exacerbated the problem.
Canada is one of the few countries (if not the only) that did not deregulate bank service. The result is that no one needed bailout and Canada barely felt the recession. What did hurt us the most is the lower price of gas which reduced the part of taxes Canada charges on exportation.
Unemployement got a little bit higher because we exported less goods to the USA including gas.
It is easy to blame the poor that receive government help. If you go back to the turn of the century in the USA you had trust which lead to the anti-trust law. What you are going through now is not that much different.
I found a link which explain well the welfare part of the budget:
http://www.ourdime.us/102/budgetinfo/how-much-do-we-spend-on-welfare/
The real welfare in the USA is corporative:
Defense $683 billion in 2010. How many corporation are only employed by the US government to produce military equipment? Much of this equipment is unnecessary in todays war and Romney want to had about 200 billions to that budget.
Sylvain,
Anyone who thinks that the US has, on net, deregulated is not paying attention. True, a few things have been rolled back, but they’ve been overwhelmed by things like Sarbanes-Oxley or Dodd-Frank or Obamacare, not to mention the relentless thousands of pages of regulations added to the Federal Register each year that largely don’t depend on new legislation.
I agree that corporate welfare is a problem, though defense is a red herring. Sure, it’s a lot of money, and definitely some is wasted (what government expenditure is efficient?), but it actually has a benefit. It’s hard to predict what the next war will look like, and while I’m sure we’re at least somewhat unprepared for it, I’m not as confident as you seem to be about getting rid of so much of it.
Rather, start with getting rid of anything that mentions ethanol or sugar. Then move on to “green energy” boondoggles. Often the problem is less the amount of money that is spent, and more the market distortions introduced. It’s not just public money that goes down the hole. The public money attracts private, too, but the natural market feedbacks are eliminated or at least dulled, and we end up wasting capital that could have been productive.
I’m not sure why you think I “blame the poor that receive government help.” I blame the government for skewing natural incentives and creating a dependent class. I know people who have decided to ride their 99 weeks of unemployment rather than really searching for work, since that’s the rational choice for them, given their other options. I agree with them about their choice being rational, but it makes me sick that we’ve created a system where it’s better for people to be drags on society than to be productive members.
I haven’t a clue what you might be talking about with respect to “lost 4 trillion in revenue.” I guess this is some long term WAG about the “Bush tax cuts.”
Oh, how I long for the days when a $400B deficit was considered outrageous.
Matt,
The financial market had a huge deregulation before the crash, Dodd-Frank happened after the financial market had shown that they couldn’t be trusted. Such deregulation did not happen in Canada and we did not have any meltdown.
The DOD has asked for about $600 billion budget, which is normal in a time where you are reducing wars involment. You need less soldier, ammo, bomb, fuel, etc. Romney is offering them $200 billion more in funding they did not asked for. The supremacy of America in conventional weapon is uncontested. There is no more risk of a total nuclear war of mutual destruction. No other country as any naval ambition. To maintain the power of a Navy/army is one thing. To add to it when the budget is already bigger than almost the entire planet becomes a huge waste.
I’m not a believer of Global Warming, but I do believe in energy in all its forms. So investment in research to develop green energies or better consumption makes a lot of sense. I’m against rising the price or gas and coal artificially, but I have no problem in making green energy more affordable.
If it is not the government that regulate the market then it is the most powerful companies that do it between them. What chance anyone had to create a successful enterprise at the time of the thrust? There was no chance, the trusts protected themselves from any intrusion. Government is required to maintain a competitive market. If it wasn’t for the anti-trust laws Apple whould have died in the 1990s, when Microsoft gave them more than $100 millions a year to keep them alive.
Unemployement is an insurance which people by into. The 99 weeks benefit is ridiculous though the economy restarting much to slowly and I’m not sure how someone looking for a job had any chance to actually find some work. The USA, Canada, Europe need to bring back its manufacturing capacity back. We need to forget about China and protect ourselves from it. Not everyone is able to study in universities. These people need to have access to good paying jobs. Minimum salary should be raised. It is ridiculous to pay someone $7.5/hour. Bigger pays mean more tax collected and less people receiving welfare. Saddly companies are using welfare has a form of subsidies to not pay their employees.
When Bush became president their was a surplus. That surplus vanished with the 2 wars and the tax cut. Bush added $5 trillion to the debt, $4 trillion of it was from the tax cut and $1 Trillion the wars.
Sylvain,
The thought that the financial markets were deregulated is a fantasy. True, Glass-Steagall was repealed. Interestingly, the institutions that were affected weathered the crisis better than those that weren’t.
There are plenty of opportunities to find work, though often not as nice as the work prior to unemployment. It’s fascinating that so many people suddenly start finding work as they near the end of their unemployment period. Yes, as insurance, unemployment makes a lot of sense. We’re way past that now.
Minimum wage should be abolished, not raised. It’s a classic example of a benevolent policy that harms more than it helps.
The surplus Bush inherited was a combination of several things, not the least of which was the dot com bubble, which cost a lot of people a lot of money, but because there wasn’t the same level of government hanky panky as with mortgages, didn’t cause anything like the level of damage.
The bigger problem was that spending kept on going up under Bush. And again, not just on defense. Revenues went up, but spending went up faster. Bush was just too Progressive for our own good.
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