The breathtaking price tag of Washington’s stimulus bill, as well as the speed with which it rushed through Congress, is historical change indeed. The price tag exceeds the total of all federal spending combined since the beginning of our country. It was voted on without debate and without time to even read the bill.
Elected officials had not read the legislation and few, if any, Americans knew what it contained. It is a vast collection of projects from the wish lists of members of Congress, projects all the way from needed and easily justifiable infrastructure projects such as roads and bridges, to wretched excesses of spending for such things as tattoo removal.
Last year’s version of a stimulus package was for the alleged purpose of lifting the American economy. It failed. Will the current stimulus create jobs and boost the economy? We simply don’t know.
What we do know is that expanding taxes plus excessive spending has never worked to overcome a recessionary economy. Nor did it work to ameliorate Japan’s 10-year recession or invigorate the economies of European countries.
Historically, such spending and taxation becomes a vehicle for wealth destruction.
It is frightening to witness the change in the level of government intervention in the American capitalist marketplace. More than two centuries of a capitalist society have offered more opportunity and more liberty for more people than any other system in history.
Forcing society’s productive citizens to bail out failed businesses and individuals who live in homes they cannot afford constitutes rewarding bad behavior and punishing those who followed the rules. Approximately 92 percent of mortgage holders pay their mortgages on time and sacrifice to do so.
The administration’s promise is to raise taxes on the top 5 percent of taxpayers in order to give tax cuts and benefits to the other 95 percent. Realistically, such an increase on 5 percent of Americans cannot possibly sustain the other 95 percent of the population. Such ambitious entitlements have consequences such as encouraging dependency, subsidizing failure and penalizing success and prosperity.
It has always been an economic axiom that government cannot create wealth. It can only use up wealth created in the private sector, wealth earned by those who risk their own money and labor in the marketplace.
Welfare reform passed by Congress in 1996 has been successful, but is essentially repealed in the stimulus package. The stimulus plan increases welfare money to the states and defeats incentives by giving bonuses to states that place more people on welfare. Governors have realized that the $23 billion expansion in welfare will force their states to raise business taxes if they accept this “free” money. Once again, “consequences” enter the picture.
Perhaps the most striking and unreported provision in the plan calls for a very substantial change in health care policy. It essentially nationalizes health care – which has failed in other countries – by giving bureaucrats, not doctors, power to decide which procedures have “clinical effectiveness.” This system would punish doctors who failed to implement directions of the non-doctor bureaucrats, and is a system that must basically ration care. Your care will be approved, or not, based on a chart in Washington showing your life expectancy and a bureaucrat’s determination whether a new hip or knee at your age will be “cost effective.” Your doctor can make a diagnosis but treatment depends on a non-doctor bureaucrat’s assessment, an idea dreamed up by disgraced former Sen. Tom Daschle. He believes Americans must “learn to accept the consequences of aging instead of treatment.”
Those receiving handouts from the stimulus are easily seduced. Whether it is mayors, businesses, colleges and universities, private agencies or homeowners, they will nearly always support legislation containing money for themselves regardless of negative overall consequences. That is exactly why there are nearly 9,000 earmarks, to gain support and mute objections.