Tuesday, March 8, 2011

WSJ.com - The Unhappy Paradox of Santa-Statism

WSJ.com - Opinion: The Unhappy Paradox of Santa-Statism


The real problem [with budget cutting] is that cutting almost anything is impossible when what passes for governing philosophy is little more than a bromide such as, "The government should do nice things for people."

The president is hardly alone in this Santa-Statism. And to be sure, polls about the government doing generic good things for people elicit positive responses, even in these times of antigovernment fervor.

So it might seem like a winner for a politician to lard up every policy and speech with government kindness. But this leads to a terrible paradox for policy makers. While Americans favor "nice things" in theory, the resulting government—a kind of adlibocracy, if you will—ends up looking wasteful at best and predatory at worst.

The "doing good" philosophy cannot accommodate difficult but necessary budget decisions. It will always devolve into a drunken spending binge largely directed toward rewarding political friends like public-sector unions (witness the current mayhem in Wisconsin), engaging in social engineering (see the new health-care mandates), socializing losses (emergency loans and grants to failing businesses), and doling out pork (look almost anywhere in the stimulus).

So citizens say they want government to help them, politicians oblige, but citizens loathe the result. How do we cut this Gordian Knot? The solution is a real philosophy that outlines what the government should do—and, just as importantly, not do.

What is that governing philosophy? Here is an answer from the great economist and Nobel laureate Friedrich Hayek: As regards the economy, the government should provide a minimum basic standard of living for citizens, and address market failures in cases where government action can do so cost effectively. That's all.







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