Thursday, June 16, 2011
When Government Jumps the Shark and FannieGate by Walter Russell Mead
Mead’s insightful analyses explain how the housing mess imploded our economy and how various government “entitlement” programs evolved through various stages until they grow to be too large to dismantle and so charged that they become the “third rail” of politics (meaning, untouchable unless you want to be electrocuted). However, like the mainstream media Mead misses a moral point: the welfare state depends on the moral premise that people are “entitled” to benefits regardless of the consequences. I put the word entitled in quotes because I disagree with this designation. To me saying I’m entitled to something means I can morally demand that someone else provide it to me against their will.
Mead points out that most programs like Social Security start out small then grow to the point that many people depend on its continuation while being supported by a declining base. In addition a continent of special interests consisting of politicians, lobbyists, etc. sprouts to cater and foster this group. The scope and target population of these programs expands in order to increase the “customer base” (i.e., potential voters who will support the politicians who curry their favor) until they become an increasing burden on those who foot the bill.
Here is another way of putting it by using a different animal metaphor. After decades of welfare statism (and crony capitalism) the chickens are coming home to roost. Unless we acknowledge and deal with the trillions of dollars of unfunded liabilities which loom in the future I’m afraid that the unrest we’re currently seeing in Greece will turn into a feeding frenzy of unsupportable demands that spread to Europe and the U.S.
In any case I highly recommend reading Mead’s two essays.