As I write this, the latest episode of US Government Debt Ceiling Theater seem to be approaching its denouement: Congressional and White House negotiators report “progress” in talks to raise the government’s debt ceiling before (not especially fat) lady, US Treasury Secretary Janet Yellen, sings “default.”
I say “episode,” but perhaps the proper term is “reboot.” The story never really changes. In each iteration, both sides dance on the brink of default until nearly the last minute, then agree to minor spending cuts now and big ones later in return for raising the “debt ceiling,” then cruise toward the next episode when those big spending cuts never arrive and Congress gets up against its credit card limit yet again. Rinse, repeat.
The big question, which never seems to get asked very loudly, is “why do we go through this over and over, with big blow-ups every few years, and nothing ever getting really settled?”
The answer, as popularized in several mid-20th-century songs:
“Everybody wants to go to heaven, but nobody wants to die.”
Americans want all kinds of goodies, and American politicians want to hand out those goodies.
Americans don’t want to pay for those goodies, and American politicians don’t want to demand payment for those goodies.
For example, Americans want lower retirement ages, bigger retirement benefits, and better Medicare services, without paying higher FICA taxes.
If you suggest that they pay more in advance, wait longer to collect, make do with a smaller check, or pay a higher Medicare premium, don’t bother running for office (or, if in office, for re-election).
Ditto good highways but no tolls, mass transit with fares that don’t cover the cost of providing it, “free” college, etc.
Politicians’ solution: No biggie! We’ll just BORROW the money, and let someone ELSE worry about it later!
It should be obvious that this can’t go on forever.
And, in fairness, other countries have all those things.
How do those other governments provide all those goodies? By taxing the bejeezus out of their “middle class” citizens.
France’s government takes 46.2% of the country’s Gross Domestic Product in taxes. Denmark takes 46%. Sweden, 44%. Germany, 37.5%.
Apparently THEIR citizens are willing to die to go to heaven, and a social-democratic welfare state strikes them as heaven.
The US government takes 27.1% of GDP in taxes, and does a pretty lousy job of replicating those welfare states. The people who want that kind of thing don’t want to pay nearly twice as much in taxes for the real deal, and even the insane level of borrowing we’ve seen since World War Two won’t cover the tab.
Neither will “taxing the rich.” There are only so many of them, they already pay most of the income taxes in the US, and confiscating every dime they have or earn wouldn’t come close to making up the difference between revenues and spending.
Personally, I’m not big on the social-democratic welfare state concept. But those “middle class” Americans who want it need to either cough up or shut up.
Thomas L. Knapp (Twitter:@thomaslknapp) is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.