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Fiscal Responsibility
MalaysianShrew
Registered User regular
Registered User regular
I read this quote the other day and it struck me as very relevant:
A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves money from the public treasure. From that moment on the majority always votes for the candidates promising the most money, with the result that a democracy always collapses over loose fiscal policy followed by a dictatorship.
-- Alexander Tyler
In a time when the US government has massive debt accumulating every day with virtually no talk of paying it off, I wonder what will happen to us if we can't give up some of our services in a time when our economy and tax base are slipping away. How can a government run by the people en mass not run the government into the ground by repeatedly voting down increased taxes and repeatedly voting for increased services? Someone, somewhere, has to be the bad guy and tell the citizens "no", but how can that bad guy remain in power? I suppose this is another reason why a direct democracy would collapse, but allowing representatives to control the check book only seems to delay the downfall to when the representatives realize that by being irresponsible with the check book they can get elected more readily without any immediate repercussions. Times like this make me think about becoming a stated conservative, at least as far as government spending goes. However, how can I know when to support a conservative and when not to? I don't have time or access to all the information I would need to make an informed vote and yet I can't trust either side all the time. I cannot figure out how to rectify this.
To broaden this to outside the US, what will happen when the oil money dries up for the Scandinavian countries? Will their populace vote or allow someone to cut back on their socialist paradise?
A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves money from the public treasure. From that moment on the majority always votes for the candidates promising the most money, with the result that a democracy always collapses over loose fiscal policy followed by a dictatorship.
-- Alexander Tyler
In a time when the US government has massive debt accumulating every day with virtually no talk of paying it off, I wonder what will happen to us if we can't give up some of our services in a time when our economy and tax base are slipping away. How can a government run by the people en mass not run the government into the ground by repeatedly voting down increased taxes and repeatedly voting for increased services? Someone, somewhere, has to be the bad guy and tell the citizens "no", but how can that bad guy remain in power? I suppose this is another reason why a direct democracy would collapse, but allowing representatives to control the check book only seems to delay the downfall to when the representatives realize that by being irresponsible with the check book they can get elected more readily without any immediate repercussions. Times like this make me think about becoming a stated conservative, at least as far as government spending goes. However, how can I know when to support a conservative and when not to? I don't have time or access to all the information I would need to make an informed vote and yet I can't trust either side all the time. I cannot figure out how to rectify this.
To broaden this to outside the US, what will happen when the oil money dries up for the Scandinavian countries? Will their populace vote or allow someone to cut back on their socialist paradise?
Never trust a big butt and a smile.
MalaysianShrew on
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Oil money is only really underpinning the economy for Norway. Denmark, Sweden and Finland have rather diverse and stable economies with their current tax rate. And Norway is actually investing a big fraction of that Oil money in to the economy and long term funds to keep everything working - sounds pretty responsible to me...
Addition: You seem to be conflating 'responsible' with 'spending less' rather than the (in my mind) more apt 'spending only as much as you have' and 'spending well'
I don't know which "services" you're concerned with, and an intelligent discussion on this topic cannot be had without specifics.
Personally, though, I'd rather see some heavy cuts to defense before we started looking at social services.
the "no true scotch man" fallacy.
Yep.
Cutting the defense budget is pretty much of the question.
No, it never has been out the question.
The defense budget went down after the Cold War. 1989 - 303 Billion, 1999 - 274 Billion.
And there is a process for military base closures: BRAC http://en.wikipedia.org/wiki/Base_Realignment_and_Closure
Politics is still involved, but it is much more difficult to save a base under this process in place.
As far as fiscally conservative politicians, well, there aren't all that many of them, but Project Vote Smart is a pretty good resource for you to better understand your representatives' stated positions.
Military bases aren't the money sinks that need to be closed, Star Wars, the Osprey, numerous other ships and planes &c. are what should be targeted, but won't be. Chiefly because military contractors have plants which deal with part of construction of the various crap in virtually every state, making it politically untenable to cut off funds. We could increase the number of boots on the ground while simultaneously decreasing the DOD budget; it just won't happen, because that's a sacred cow.
This.
the "no true scotch man" fallacy.
The problem I have with this argument is that our GDP itself is unsustainable, because our consumer spending (a large portion of GDP) is itself fueled by a -4% (yes, negative) savings rate. Another (opposite) point to make is that a large portion of the US debt is owed to itself in the form of IOU's to the social security fund. More than anything we should stop raiding our own damn surpluses, but Congress sure does love its deficit spending.
Cut spending drastically, especially defense, increase taxes across the board, but especially on the rich (so as to get back on the right side of the Laffer curve), maybe introduce something like the GST, and for fuck's sake reformulate the policy mandate of the Fed to control inflation, not protect or increase employment.
The dual mandate the Fed has just boggles me. Not all the time, but how do you balance two mutually exclusive factors? They got away with it recently because CPI was driven down by cheaper costs from imports, but now that the input costs are rising in China in conjunction with a general rise in food and commodities, what happens?