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From crisis to catastrophe, and (hopefully) back out again

Regarding the economy, in one of the most reasoned pieces that I have read in the last few days, Robert Stacy McCain ("The Other McCain") writes:

The first Baby Boomers turn 65 in 2011, and every year after that will see more and more retirees going onto the Social Security and Medicare rolls. Even if we raise the retirement age, there is still the net drain of productive labor. The average 67-year-old can't produce goods and services as efficiently as the average 38-year-old and (due to certain legal decisions circa 1973) after 2011, we'll have a growing shortage of 38-year-olds and a growing surplus of 67-year-olds.

We are on the verge of a taxpayer shortage, you see, and what the Democrats want to do is take out a massive loan that will have to be repaid by a shrinking pool of taxpayers, who will be expected to support a burgeoning population of increasingly sickly Baby Boomer retirees.

So, even if all this deficit spending could purchase a dead-cat bounce -- and I am on record as saying it won't -- it cannot fix the underlying problems of our economy, which have nothing to do with "green energy" or other such nonsense programs run by the Department of Unicorns and Rainbows.

What we need, really, is a strong dose of Schumpeterian "creative destruction," and this neo-Keynesian approach is the exact opposite of that. No matter what government does, we may be doomed. But Obamanomics is like seeing a drowning man and tossing him a cinderblock instead of a life preserver.

Then he caps it off with this little gem:

Back in 2003-06, when the economy was going gangbusters, you leftist bastards were all whining about "the growing gap between rich and poor." Well, congratulations: It's stopped growing, hasn't it?

What makes the Democrat plan even worse is the fear-mongering that the party is using to scare Americans into surrendering their freedom in exchange for flimsy promises of government salvation. Honestly, this is every bit as bad -- or worse -- than anything I ever saw growing up in a culture of Fundamentalist revivals and hellfire preaching. Liberals should be ashamed of themselves and their party for unscrupulously using the tactics of coercion that they pretend to find so primitive and offensive in order to advance their own misguided agenda.

At the heart of this matter, I believe, is the realization by liberals that the government can only do so much with finite resources. The older members of government are probably thanking their lucky stars that they will be dead and gone in 10 or 15 years, and will not have to suffer through the next 40+ years like the rest of us who are age 40 and under. But the younger members of government undoubtedly understand the argument that I quoted above, that there will be fewer Americans working harder and forking over an ever-increasing portion of their earnings in order to foot the retirement bill for a significant number of older, less productive Americans.

As people get older, as their productivity declines, their health declines as well. That's just a simple fact, and there is nothing that we can do to change it. As people get older, they require more medical treatment. And as their bodies weaken, the cost of providing that medical care increases. This creates an interesting paradox. We normally consider "value" (which is directly related to cost) to be in direct proportion to productivity. As we grow older, our ability to be productive declines, yet our maintenance cost -- particularly our medical cost -- to the system continually increases, even reaching an exponential growth rate if we contract a disease like cancer or end up as a stroke victim, alive but completely unable to take care of ourselves. In other words, as we grow older and/or more ill, the justification for the money spent on health care becomes irrational, rather than pragmatic.

This creates an interesting moral dilemma. In attempting to rationalize health care expenses and streamline costs, we effectively put a dollar value on human life. We do this all the time, of course (see Schiavo, Terri) but no one likes to talk about it -- except when we can use it to bludgeon an "evil corporation" (see Pinto, Ford) because they made the mistake of setting a dollar value for human life that is considered to be ridiculously or inexcusably low. In our attempt to rationalize costs, we are prone to make pragmatic yet immoral decisions.

That is what Ford Motor Company did when it decided that the cost of deaths and horrible burn injuries from the Pinto would be less than the cost of fixing the problems with the Pinto that made it catch fire easily in rear-end collisions. And that is what we are about to do to ourselves, if Congress passes the current Spendulus bill, which includes a deeply-buried item that authorizes a "National Coordinator of Health Information Technology." The bureaucracy that this National Coordinator will build is charged primarily with establishing a national information-sharing system for health care providers. But it will also monitor nationwide trends in healthcare and medical treatment, and use the results of its studies to reduce health care costs by "guiding" medical practitioners into making better, more efficient treatment decisions. "Guide" is simply a polite way of saying, "do as we say, or you won't get paid."

How many Ford Pintos will the Federal Government build, figuratively speaking, as it "guides" doctors away from humane, moral, and, yes, irrationally expensive medical decisions that provide comfort and at least a glimmer of hope to the chronically ill and dying, and toward more efficient, cost-effective, pragmatic, and ultimately immoral medical decisions -- decisions that will certainly include limiting or withholding treatment for the terminally ill, and perhaps even euthanasia?

Perhaps the reason that the National Coordinator of Health Information Technology provision is buried so deeply within the massive Spendulus bill is that our big government leaders hope to enslave us so thoroughly with other rules and regulations that we will eventually just accept an endless series of Ford Pintos as being the normal status quo, and resign ourselves to being burned whenever the nanny state collides with the immutable realities of life.

But there is a glimmer of hope. The ever-optimistic Milton Friedman believed that America enjoyed two distinct advantages over other nations with regard to its ability to escape from the worst effects of socialism. First, Americans have an uncanny ingenuity that has allowed them to continuously find loopholes in government regulations. And second, the US Federal government is incredibly wasteful. Friedman believed that government waste was good, because the resulting inefficiency that it caused effectively forestalled absolute tyranny, and the enormous scale of its waste would continually spur grassroots efforts aimed at at reform and change.

I think that Friedman is right; perhaps not in the details, but in his observation of the unique spirit of America that has kept us out of serious trouble time and time again. We, at least, have the dreadful examples of Japan, Western Europe, the former Soviet Bloc, and numerous other nations who have gone before us and tried to make centrally-planned economies and huge, debt-driven "stimulus programs" work. Let us pray that enough people recognize those mistakes before this nation makes them again on an even bigger, and more disastrous scale.


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Comments (13)

I wonder if Milton Friedman... (Below threshold)
DaveD:

I wonder if Milton Friedman even in his wildest dreams could have ever anticipated an economic catastrophe on an order of magnitude as that of the Generational Theft Act of 2009. If the current president can so easily sanction the death of a child who has inconveniently survived an abortion, you can draw your own conclusions about ways he might feel the economic impact of the elderly on the health care system can be moderated.

This post rings shockingly ... (Below threshold)
Brian:

This post rings shockingly hollow.

First, after $2 trillion on the Iraq war, then $700 billion for TARP I, you're now suddenly worried that "what the Democrats want to do is take out a massive loan that will have to be repaid by a shrinking pool of taxpayers". Gee, why didn't you ever think of that when it was Republicans asking for the money, I wonder?

Then you pretend to be offended by "the fear-mongering that the party is using to scare Americans into surrendering their freedom in exchange for flimsy promises of government salvation." Did you remember the Patriot Act, rushed through with warnings of new terrorist strikes, ready to fall on our children unless we quickly to surrender our freedoms to government protection, pushed through without anyone having a chance to read it? Or that if you vote for Kerry "we'll get hit again and we'll be hit in a way that will be devastating"?

Republicans whining about out-of-control spending and fear-mongering is like Dracula getting faint at the sight of blood.

And Democrats castigating R... (Below threshold)

And Democrats castigating Republicans for "out of control spending" and "fear mongering," and then doing a complete 180 and using those same techniques to ram through their own agenda is hypocrisy at its finest. It must be pretty hard to be proud of your party these days, Brian.

How original. After being r... (Below threshold)
Brian:

How original. After being ripped for your hypocrisy, your response is "you're a hypocrite!", a charge that rings false, since Democrats castigated Republicans for wasteful spending in Iraq, not for spending here at home.

Have you nothing to say besides "tax cuts! tax cuts!" no matter the situation?

Brian,You must expla... (Below threshold)
DaveD:

Brian,
You must explain something to me. Why are liberals so against the concept of tax cuts. From my limited perspective tax cuts in the past have clearly not placed a strain on the economy as a whole although the lack of revenue from higher taxes might prevent the implementation of a specific interest group's particular program. So although you might be tired of hearing it, could you cite an example of where tax cuts to individuals have proven to be bad policy.

Brian,One can disa... (Below threshold)

Brian,

One can disagree on the necessity of military spending, but the undeniable truth is that it is not open-ended. Democrats will work to the bitter end to make sure that our commitment in Iraq is ended as quickly as possible, and that not a dime more than absolutely necessary will be spent.

The same simply cannot be said about social spending. Imagine if President Bush had told Congress to cut 10% from Social Security or unemployment benefits or perhaps the government's own payroll, as President Obama has just done with the DOD. There would be weeping and gnashing of teeth, yes?

The only things that will be temporary in the Spendulus bill are tax rebates and tax rate cuts. All the spending will stay, and the amount of new bureaucracy created by the bill will be staggering. Do we expect those tens or perhaps hundreds of thousands of new government positions to be terminated when the economy recovers from the recession? I thought not.

You simply cannot compare defense spending, which is discretionary (even though defense is a mandated Constitutional function of the government) and entitlement spending, which is mandatory.

My criticism of Obama still stands; it is wrong for a president to use fear tactics and to deliberately stall the economy by talking it down in order to sell a multi-trillion dollar pork spending plan.

So although you might be... (Below threshold)
Brian:

So although you might be tired of hearing it, could you cite an example of where tax cuts to individuals have proven to be bad policy.

Sure.

The quote of the day<... (Below threshold)
retired military:

The quote of the day

"Back in 2003-06, when the economy was going gangbusters, you leftist bastards were all whining about "the growing gap between rich and poor." Well, congratulations: It's stopped growing, hasn't it?
"

------

Brian said

"Back in 2003-06, when the economy was going gangbusters, you leftist bastards were all whining about "the growing gap between rich and poor." Well, congratulations: It's stopped growing, hasn't it?
"

Lets see Brian

Tax cuts caused the amount of revenue into the govt to be the HIGHEST EVER.

The only bad thing is that Congress spent like drunken sailors.

And before you shout

"EEEEBBBILL Republicans"

Democrats were in charge of the Congress the last 2 years of the Bush administration.

During the 8 years of Bush the deficit increased by $1 trillion

The demoRATS just about topped that with Obama being President in 3 WEEKS.

Stuff it in your ear. Of course you have to get a colonostomy to do it since your head is so far up your ass.

"Let us pray that enough pe... (Below threshold)

"Let us pray that enough people recognize those mistakes before this nation makes them again on an even bigger, and more disastrous scale."

Wouldn't count on it. The MSM isn't going to bring it to their attention. Most people are more interested in American Idol anyway.
http://www.rightklik.net/

Brian saidI... (Below threshold)
Brian:

Brian said

I did? There you go hallucinating again.

Tax cuts caused the amount of revenue into the govt to be the HIGHEST EVER.

A decline in tax receipts, stemming from the 1.5 million jobs lost in the first three months of the fiscal year, also contributed to the soaring deficit.

Oops.

Democrats were in charge of the Congress the last 2 years of the Bush administration.

And what massive spending bills did they initiate?

During the 8 years of Bush the deficit increased by $1 trillion
The demoRATS just about topped that with Obama being President in 3 WEEKS.

Thus demonstrating that you have no idea how a deficit is calculated. Besides, with $2 trillion in war spending, and $700 billion from TARP I, do you really think that $800 billion for the stimulus exceeds those amounts?

Stuff it in your ear. Of course you have to get a colonostomy to do it since your head is so far up your ass.

Oh, good one! Gotta resort to the insults when your "facts" are so factless.

Brian"Oh, good one... (Below threshold)
retired miilitary:

Brian

"Oh, good one! Gotta resort to the insults when your "facts" are so factless"

Take note this is a fact.

"Stuff it in your ear. Of course you have to get a colonostomy to do it since your head is so far up your ass."


"Thus demonstrating that you have no idea how a deficit is calculated. Besides, with $2 trillion in war spending, and $700 billion from TARP I, do you really think that $800 billion for the stimulus exceeds those amounts?

"
Hey ASSWIPE this shows you have NO CLUE how the defense dept spends money. The VAST MAJORITY Of the $2 trillion would have been spent REGARDLESS. It goes towards things like paying salaries, maitenenace etc. STOP WITH THE LIBERAL MIMES. ACtually the last figure I saw was that about $600 Billion had been spent in IRAQ. Oh wait, the dems top that in THREE WEEKS for their pet projects.


"And what massive spending bills did they initiate?"

Well considering ALL SPENDING BILLS Come out of the HOUSE and DEMS CONTROLLED THE HOUSE HOW ABOUT EVERY BILL THAT CAME OUT OF THE HOUSE including the $700 BILLION ABORTION called TARP.

BTW DUMBASS AKA BRian<br /... (Below threshold)
retired miilitary:

BTW DUMBASS AKA BRian
"A decline in tax receipts, stemming from the 1.5 million jobs lost in the first three months of the fiscal year, also contributed to the soaring deficit."

http://www.washingtonpost.com/wp-dyn/content/article/2005/07/13/AR2005071301617.html

"The federal budget deficit will slip to $333 billion this fiscal year, from $412 billion in 2004, as a surge of unanticipated tax receipts pushes the red ink significantly below levels projected just five months ago, White House officials said yesterday"


http://mjperry.blogspot.com/2007/04/record-tax-revenue-tax-hike-of-2003.html
"We keep hearing about the "tax cuts of 2003" (rates were decreased) when it was actually a "tax increase," if we look at what happened to revenues. In 2006, tax revenues were at all-time historical high of $2.4 trillion. At the current pace, tax revenues collected this will be $2.64 trillion, and will set another record."

http://www.taxfoundation.org/blog/show/1296.html
"The Treasury Department released its Monthly Treasury Statement for December 2005 today, and the numbers show a growing economy that is spinning off record tax revenue for the federal government.

Total receipts for December 2005 alone were $26 billion larger than December 2004, which equaled a 12 percent increase.

Currently, total receipts for the 2006 fiscal year are $43 billion larger than they were for the same period last year. This is an 8.8 percent increase in revenue.

Driving this impressive increase is a large increase in corporate tax revenues. In December 2004 corporate revenue was $51.9 billion. In December 2005 corporate revenues equaled $71.2 billion; an increase of $19.3 billion, or a 37 percent increase.

"

Dont let facts get in the way of you putting your head in your ass Brian. Or should I say KEEPING IT THERE.


Brianhere are some... (Below threshold)
retired miilitary:

Brian

here are some FACTS (dont let them get in the way of your delusions now)

http://www.fas.org/sgp/crs/natsec/RL33110.pdf
See chart page 10

Spending Iraq war FY03-FY09
$657 Billion

AND THAT INCLUDES FY09


Oh wait didnt the dems promise to stop funding for the war if they got elected in 2006. What happened there?

Learn to stop repeating liberal LIES and grow up and come into the real world.

Try using accurate figures instead of rolling up the defense department entire budget for the past 5 years.




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