Sunday, December 30, 2012

Of Financial Crisis and Hopes for Better

Sitting by the hearth on a Sunday afternoon, comfortable and cozy, while the winter winds blow, it is easy to ponder how the changing of the year has come to be a time for leaving behind the failings of the past and embracing hopes for better in the future.  I reflect upon the general healthy recognition at this time that happiness in the new year is to some important degree connected with our own personal performance.  Success is not so much the luck of what happens to us as the result of what we do, hence our natural determinations to resolve to do better in some way or another.

Within a few weeks—or even a few days—many of us overcome such thoughts, abandon our resolutions to do better, and settle back into familiar patterns, including the narcotic belief that what happens to us is largely a matter of fate and fortune and little related to our efforts and actions.  Successful people are seen as more “fortunate” than others, who somehow owe something to the “less fortunate,” especially if we consider ourselves among the “less fortunate.”  How else could rational people conjure up the palpably false claim that it is fair to demand and take the property of more successful people and give it to those who have done little or nothing to earn it, who in fact have in many ways squandered their wealth and opportunities for success?

Had we as a nation embraced the principle that what a man or woman earns is his or hers to use or keep or share as he or she wishes, we would have avoided the weeks-long political soap opera called “the fiscal cliff.”  The misleading story proffered by the institutional media is that our nation is on the edge of economic calamity because Congress—meaning by implication the Republicans in the Congress—is unwilling to do its job.  In fact, there are important fundamental principles at the heart of the disagreement between congressional Republicans and President Obama, namely whether cutting government spending—mostly government give away programs—should be postponed by raising taxes on the “wealthy” and independent businesses, and moreover whether raising any taxes on a weak economy makes economic sense.  There is a growing gap in views over these principles.  But for the national cult of coveting there would not be one, but there is, and sooner or later it will be too wide to bridge.

Without this disagreement, we would address excessive government spending the same way that families do.  Families that spend more than they earn will either borrow (within their means to support debt), reduce spending, or earn more, or some combination of these.  Our government has almost exclusively relied upon borrowing (beyond our ability to support it without foreign help), has increased its spending, and has “earned” less. 

On this last point, keep in mind that governments do not earn anything; people do.  Governments take what people earn.  Government policies over the years have reduced economic growth below the growth of government, inhibiting the ability of people to earn, which in turn undermines what our government can afford.  This trend has not been getting any better and has brought us to economic crisis.  A refocus on economic growth, not government growth, is what is needed, but there lies the disagreement in Washington.

In that context, I take advantage of the year-end season of better rationality—however brief—to propose that the bells we sound for the new year ring out the old and destructive coveting for the fruits of others’ labors and ring in the determination to improve our own condition by our own labors.  I propose that for you and for me and for our society as a whole we commit to rely more upon ourselves and to unleash our creative powers for growth and prosperity.  In the same way we will increase our ability and willingness to help others, but we will do so as a healthy exercise of our free will.  Government cannot be generous, for there is no generosity in distributing other people’s money.  But the individual people who make up society can and will open their hands to those around them, as Americans have more than any other people for more than two centuries.  More productive ourselves, we will have more means to share and better judgment about how to share it—ennobling to ourselves and to those we choose to aid.

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