Quotulatiousness

February 21, 2012

The real problem with forcing employers’ insurance to pay for contraception

Filed under: Government, Health, Liberty, Religion, USA — Tags: , , — Nicholas @ 11:29

At the Adam Smith Institute blog, Tom Clougherty discusses the biggest problem with the current American debate over contraceptives and insurance coverage:

Now, I’m no Rick Santorum. I’m a fan of contraception. But there’s so much wrong with this story that it’s hard to know where to start. Should the government really compel you to buy a service from a private company? It’s probably better than the government nicking your money and providing that service themselves, but for a libertarian it still rankles. Then there’s the insensitivity to deeply-held religious conviction, which not only exposes the ‘liberal’ left’s inability to tolerate social mores that differ from their own, but also highlights the way big government inevitably tramples on diversity and choice with its one-size-fits-all monomania. And then there’s the idiot-economics which suggests that you can force a company to provide a service without anyone having to pay for it. In this case, assuming insurance companies can’t find a way of covertly passing on the cost of contraceptive cover to church-affiliated employers, then everyone else with insurance ends up footing the bills through higher premiums.

But perhaps the biggest problem is the one explained by Sheldon Richman in this Freeman article: contraception has nothing whatsoever to do with insurance.

    Insurance arose as a way for individuals to pool their risk of some low-probability/high-cost misfortune befalling them. It shouldn’t be necessary to point this out, but coming of child-bearing age and choosing to use contraception is not an insurable event. It’s a volitional act. It may have good consequences for the person taking the action and society at large, but it is still a volitional act. It makes no sense to talk about insuring against the eventuality that a particular person will use contraception.

Greece: “now officially a ward of the international community”

Filed under: Economics, Europe, Government, Greece — Tags: , , , — Nicholas @ 10:40

Felix Salmon on the dire Greek financial future:

Greece is now officially a ward of the international community. It has no real independence when it comes to fiscal policy any more, and if everything goes according to plan, it’s not going to have any independence for many, many years to come. Here, for instance, is a little of the official Eurogroup statement:

    We therefore invite the Commission to significantly strengthen its Task Force for Greece, in particular through an enhanced and permanent presence on the ground in Greece… The Eurogroup also welcomes the stronger on site-monitoring capacity by the Commission to work in close and continuous cooperation with the Greek government in order to assist the Troika in assessing the conformity of measures that will be taken by the Greek government, thereby ensuring the timely and full implementation of the programme. The Eurogroup also welcomes Greece’s intention to put in place a mechanism that allows better tracing and monitoring of the official borrowing and internally-generated funds destined to service Greece’s debt by, under monitoring of the troika, paying an amount corresponding to the coming quarter’s debt service directly to a segregated account of Greece’s paying agent.

The problem, of course, is that all the observers and “segregated accounts” in the world can’t turn Greece’s economy around when it’s burdened with an overvalued currency and has no ability to implement any kind of stimulus. Quite the opposite: in order to get this deal done, Greece had to find yet another €325 million in “structural expenditure reductions”, and promise a huge amount of front-loaded austerity to boot.

February 19, 2012

Building a football stadium: corporate welfare at its most grotesque

Filed under: Football, Government, Media, Politics, Sports — Tags: , , , — Nicholas @ 12:07

Patrick Reusse writes for the Minneapolis Star Tribune. He’s a sports columnist, so his job — to some degree anyway — depends on the local professional sports teams (the Vikings, the Twins, the Wild, and the Timberwolves) sticking around and being competitive. Part of the sticking around these days is finding a new home for the Minnesota Vikings, who are at the end of their 30-year lease on the Hubert H. Humphrey Metrodome in downtown Minneapolis. Reusse is critical of those who don’t want their tax money going into the pockets of billionaire owner Zygi Wilf:

We so easily could be another decayed downtown, if not for the corporations, and the law firms and the accounting firms, and the retailers that remain committed to being in the city, when everything could be cheaper and more convenient by joining the sprawl in Maple Grove or Eden Prairie or Eagan.

Last month, Sandra Colvin Roy, another of the dedicated lefties on the Minneapolis City Council, announced opposition to the plan for a new Vikings stadium in downtown Minneapolis without a citywide referendum (that she knows would fail).

[. . .]

And yet it’s not only Roy and her lefty colleagues who offer a roadblock to Minneapolis coming up with its stadium share. There are righties in the Legislature with equally mysterious thoughts on the city’s entertainment tax.

“You know who pays for this?” Rep. Sarah Anderson of Plymouth said. “The citizens in my district, my constituents that decide to go to Minneapolis, maybe go out to a restaurant for the night.”

Some way, we have wound up with politicians who would put the cleaver to a great asset for the state’s largest city, and then offer the silliest of explanations, like 1) several score of people sleeping outside on government property, and 2) a few guys from Plymouth who would rather not pay an extra 3 percent for a Dewars and water at the Seville.

What stands in the way of a stronger heartbeat for downtown Minneapolis are the collections of the nearsighted that we have elected.

As you’ll know if you’ve read the blog for any length of time, I’m a big fan of the Minnesota Vikings, despite never having lived there or even visited the state. I’d be very upset if they became the L.A. Vikings. But I also totally sympathize with Minnesotans who don’t want their taxes being used to give corporate welfare to the billionaire owner of the football club. Pouring money into facilities for professional sports teams is one of the very worst ways to use tax dollars, as the lads at Reason.tv explain:

And from an article last year at Hit & Run:

To put it bluntly, regardless of how much money the state treasury might be rolling in, a public stadium is not a good use of money. Indeed, sports economists Dennis Coates and Brad Humphries estimate the presence of a major-league franchise reduces overall GDP by about $40 per resident in a given metro area.

The Vikes’ ownership has graciously offered to put up $400 million and the state is looking at ponying up $300 million, which means county and local taxpayers (read: suckers) would be on the hook for the remaining $400 million. So generous of the owners, don’t you think? Needless to say, the team would get all naming rights and a host of other related goodies.

[. . .]

Here’s a real surprise: Almost 75 percent of local residents don’t think public money should be used for a new stadium but the folks literally invested in the team and the building of the stadium are all for it!

Tim Worstall on the dilemma facing the social housing authorities

Filed under: Britain, Bureaucracy, Cancon, Government — Tags: , , , — Nicholas @ 10:45

I don’t know what the actual situation is in Britain, but here in Ontario the responsibility for public housing is a regional or municipal responsibility. There’s no automatic mechanism for planners in one area to anticipate the need for additional housing, so apartments, townhouses and other subsidized accommodations are informally “swapped” between city, town, and regional governments. Would-be tenants are able to refuse being moved from one municipality to another (if you’re in Oakville, but the offered housing is in Pickering, for example).

I suspect, based on Tim Worstall’s thought experiment here, that the British system does not work quite the same way:

What’s the first thing that rational planner is going to do? Note that there’s a number of people living in London without the means to afford housing in London. And no particular economic reason for living in London either. She’s also going to note that’s there’s great swathes of housing up North which is indeed affordable. And given that there’s no particular economic reason for those in London to be in London why shouldn’t they be on benefits up North in the much cheaper housing?

This will be, after all, greatly to the benefit of society even if a bit tough on the personal liberty side. But then that’s what planning of all these things is about, doing what is best for society, yes?

So you can see the amusement: the Statists, the planners, those who insist that society is more important than the desires of any mere individual, are in something of a bind. The current reforms to the housing market are producing exactly what a rational planner would produce. The poor are sent off to be poor in cheap housing, individual desires be damned.

February 18, 2012

Even hardcore pro-Tory cheerleaders hate the new Internet bill

Filed under: Cancon, Government, Liberty, Media, Technology — Tags: , , , , — Nicholas @ 12:27

The Sun chain of newspapers is without a doubt the most pro-Conservative media voice in Canada. When even they are calling Bill C-30 “seriously flawed”, you’ve got to hope that the government will give up:

The legislation, Bill C-30, tabled this week as the Protecting Children from Internet Predators Act, had virtually no safeguards to protect law-abiding Canadians, including the media, from being spied upon by police, bureaucrats, CSIS — even the competition bureau.

Until Prime Minister Stephen Harper punted the bill straight to committee for a badly-needed overhaul, his government appeared unconcerned about its own inconsistency.

Earlier this week, for example, the long-gun registry was finally put down, killed by the Harper majority for one reason and one reason alone.

It was rightly deemed to be an intrusion into the privacy of law-abiding Canadians.

This leaves Bill C-30 indefensible in its present form.

Requiring telecommunications providers to hand over personal information — without a warrant — to law-enforcement agencies opens the door to incredible abuses, and not just by Big Brother.

“This is going to be like the Fort Knox of information that the hackers and the real bad guys will want to go after,” said Ann Cavoukian, Ontario’s privacy commissioner.

The bill also includes a lovely little gag order provision that prevents your ISP from telling you when your information has been turned over to “inspectors” under the bill (and that doesn’t limit itself to the police: anyone could be appointed as an inspector by the ministry).

Rex Murphy: The Drummond report should have been released before the Ontario election

Filed under: Cancon, Economics, Government, Media — Tags: , , , , — Nicholas @ 11:48

In the National Post, Rex Murphy expresses his displeasure that the Drummond report was not available for discussion during the last Ontario election campaign:

With the exception of the writings of the prophets Jeremiah and Isaiah at their bleakest, flavoured with a touch of H.P. Lovecraft on the days when that lightless mind was wrestling with a migraine, the recent meditations of Don Drummond on Ontario’s fiscal situation set the standard for prose that vibrates with gloom and foreboding.

The prophet Drummond is aware of this. He tried to prepare Ontario for the grim messages he was sending. At the press conference announcing his 529-page diagnosis of Ontario’s fiscal morbidity, he produced a remarkable understatement about his report and the 320 recommendations of cuts, freezes and cancellations that so enliven its bristling pages. Said Mr. Drummond (perhaps hiding a bitter smile): “This will strike many as a profoundly gloomy message.” Those listening to Mr. Drummond recalled P.G. Wodehouse: “I could see that, if not actually disgruntled, he was far from being gruntled.”

The Drummond report is scathing, frightening, a grim portrait, an indictment of Ontario’s fiscal management during the last eight years of McGuinty government. It is everything columnists in this paper have said and more. The Drummond analysis offers what we may call a spectrograph of Ontario’s perilous financial situation. It is also a devastatingly chilly portrait of imminent decline, should the government of this once dynamic, productive and industrious province fail to follow the prescription — 320 deep, demanding and painful recommendations that Mr. Drummond so vigorously recommends.

[. . .]

Politicians worry about cynicism and apathy among the electorate. Bringing out this report after sending the voters to the polls will reinforce the cynicism and bake the apathy. And why not? I have no doubt that Tory leader Tim Hudak or the NDP’s Andrea Horwath would have found a way, or been only too obliging, to see the report after the election, as well.

There should be an election do-over. Of course there will not be. Because to call an election now, and contest one on the real state of the economy, would be an unparalleled action of real candour and public valour. It would be asking Ontarians to vote on the reality of their government, not the spin of the parties. What politician would dare set so dangerous a precedent as that?

Of course, given how badly Tim Hudak and the Progressive Conservatives fought the last election, they’d still manage to fumble, flail, and falter just enough to let Mr. McGuinty keep his job. One can only imagine that the gods (along with the rest of Canada) hate Ontario and want to see more suffering.

“Somewhere in the near-eternal labyrinth of the Drummond report there must be evidence that the McGuinty’s Liberal government did something right over the last decade. If there is, I haven’t found it yet.”

Filed under: Cancon, Economics, Government, Politics — Tags: , , , , — Nicholas @ 00:01

Terence Corcoran brings the gloom on the Ontario government’s most likely response to the Drummond report:

Ontario, get ready for The Big McGuinty. The 562-page report from the government-appointed Commission on the Reform of Ontario’s Public Services, chaired by economist Don Drummond, has all the makings of a diversionary shell game in which everybody is directed to follow the pea of spending cuts while the real game is something else.

With attention now focused on carving Mr. Drummond’s 362 recommended slices off the great Ontario spending bologna, the real bait-and-switch objective, The Big McGuinty of this giant exercise in fiscal self-flagellation, is something else altogether: tax increases.

Does anybody seriously think the Liberal government of the Rev. Dalton McGuinty, after a decade of installing feel-good spending increases and extravagant policy schemes, is suddenly going to roll it all back and reverse a decade of ideological commitment to government intervention and liberal spending programs?

The Drummond report would require policy-backtracking on a vast scale. Somewhere in the near-eternal labyrinth of the Drummond report there must be evidence that the McGuinty’s Liberal government did something right over the last decade. If there is, I haven’t found it yet.

February 17, 2012

America’s galloping regulation state

Filed under: Bureaucracy, Economics, Government, USA — Tags: , , — Nicholas @ 09:55

You know you’re becoming a regulation-for-the-sake-of-regulation state when even The Economist — whose current staff have never met an EU regulation they didn’t love to pieces — can correctly poke fun at you for your obsessive over-regulation of everything:

Americans love to laugh at ridiculous regulations. A Florida law requires vending-machine labels to urge the public to file a report if the label is not there. The Federal Railroad Administration insists that all trains must be painted with an “F” at the front, so you can tell which end is which. Bureaucratic busybodies in Bethesda, Maryland, have shut down children’s lemonade stands because the enterprising young moppets did not have trading licences. The list goes hilariously on.

But red tape in America is no laughing matter. The problem is not the rules that are self-evidently absurd. It is the ones that sound reasonable on their own but impose a huge burden collectively. America is meant to be the home of laissez-faire. Unlike Europeans, whose lives have long been circumscribed by meddling governments and diktats from Brussels, Americans are supposed to be free to choose, for better or for worse. Yet for some time America has been straying from this ideal.

[. . .]

Two forces make American laws too complex. One is hubris. Many lawmakers seem to believe that they can lay down rules to govern every eventuality. Examples range from the merely annoying (eg, a proposed code for nurseries in Colorado that specifies how many crayons each box must contain) to the delusional (eg, the conceit of Dodd-Frank that you can anticipate and ban every nasty trick financiers will dream up in the future). Far from preventing abuses, complexity creates loopholes that the shrewd can abuse with impunity.

The other force that makes American laws complex is lobbying. The government’s drive to micromanage so many activities creates a huge incentive for interest groups to push for special favours. When a bill is hundreds of pages long, it is not hard for congressmen to slip in clauses that benefit their chums and campaign donors. The health-care bill included tons of favours for the pushy. Congress’s last, failed attempt to regulate greenhouse gases was even worse.

February 16, 2012

How long will it take for McGuinty to “lose” the Drummond report?

Filed under: Cancon, Economics, Government, Politics — Tags: , , — Nicholas @ 11:24

Yesterday, the Drummond report was released, containing literally hundreds of recommendations for getting Ontario’s government back on the fiscal straight-and-narrow. Perhaps half a dozen of the recommendations will be welcomed by Dalton McGuinty and his ministers. The rest will be anywhere from mildly unwelcome to outright anathema. In the National Post, Linda Nguyen has an overview:

The Ontario government needs to “swiftly and boldly” implement all of the hundreds of recommendations in a massive report released Wednesday if it wants to eliminate a projected $30.2 billion deficit by 2017, warns economist Don Drummond.

“Unfortunately, we’re dealing with a harsh reality in identity here,” said Mr. Drummond, author of the 543-page report and former chief economist with TD Bank.

The audit, which could be an example to other jurisdictions struggling to control spending, offered 362 recommendations in various sectors including health care, education, social programs, justice and labour relations.

[. . .]

In its 2011 budget, the Ontario government had projected its deficit to climb to $16-billion, but Mr. Drummond says his projects peg it at more than double that if the province continues its current spending.

To reach the target, Ontario must decrease its total program spending to 0.8% for the next seven years.

It’s been an item of faith among Liberals and NDPers that former Premier Mike Harris carpet-bombed the provincial economy during his two terms in office. As Scott Stinson points out, however, “Ontario’s projected spending needs a 17% cut. Mike Harris only cut 3.9%”:

“Avoid across-the-board cuts. Such a blunt tool treats equally a valuable efficiently run program and one that is outdated and sloppily managed. This is dumb.”
Dumb? Such plain speaking! We are used to government reports that prefer to say a measure “fails to properly realize efficiencies by ensuring its actions are in line with forward-looking goals and objectives.”

“This is not a smorgasbord from which the government can choose only the tastiest morsels and ignore the less palatable.”
Eat your brussels sprouts, Dalton McGuinty! But despite the pleasant analogy — who doesn’t enjoy a good buffet? — this is one of the more stark lines in the whole report. Implement it all, or it won’t work, the Commission says. Yikes.

“In budget planning, do not count chickens before they are hatched.”
We’ll say this for Mr. Drummond: he’s not afraid to use the folksy language.

“Kicking the can down the road is no solution.”
See?

“Do not hang onto public assets or public service delivery when better options exist. Consider privatizing assets and moving to the private delivery of services wherever feasible.”
Also, when preparing discussions with public-service unions, bring a helmet.

[. . .]

“The province should, in future discussions with the Ontario Teachers’ Federation, reject further employer rate increases to [pension plans] beyond the current rate.”
Another one sure to be a hit with the unions. Did you know that on average a teacher retires at 59, having worked 26 years, and collects a pension for 30 years? Me neither.

“The government should work to discuss, in particular, the overproduction of teachers with Ontario’s 13 universities offering teacher education programs.”
The term “overproduction” of teachers makes them sound kind of like widgets.

“Reshape student financial assistance, including the newly announced 30% Off Ontario Tuition grant, to target more of the assistance to low-income students.”
Say, remember that key plank of your election platform? Yeah, you need to totally rethink that.

Getting rid of that messy, obstructive “democracy” thing in Europe

Filed under: Bureaucracy, Europe, Government, Greece, Liberty — Tags: , — Nicholas @ 10:40

Bruno Waterfield on the destruction of democracy in Greece and what it will mean for the rest of the European Union:

What happens in Greece will mark the opening of a new era in European politics. It is important therefore to understand what is and isn’t going on. The crisis is not, as many believe, being driven by ‘neoliberal’ economic policies. It isn’t caused by any Greek cultural propensity to fecklessness either. And, despite the protest graffiti and the timeless appeal of Nazi references, the Greek tragedy is not a plot to restore an explicit German hegemony in Europe. Angela Merkel is no Adolf Hitler.

What is happening in Greece is a crisis of European proportions because it is the sharpest expression of a destructive trend common to all countries in the EU: the twenty-first-century elite mission to place institutions, policy and statecraft above society. The Greek catastrophe, then, is an indicator of what happens when the question of interest or politics becomes the sole preserve of bureaucratic or state structures decoupled from, and increasingly defined against, the public.

Measures imposed on Greece are explicitly declared, even celebrated, as being in opposition to Greek society. Any attempt by political parties to uphold the democratic representation of Greek interests is met with aggressive hostility. Moreover, the EU-IMF programme, or so-called Memorandum of Understanding, for Greece is utterly divorced from economic reality. As documented in the Daily Telegraph, the Eurozone’s policies are pushing Greece into a ‘death spiral’ that defies any economic logic.

Are you for Orwellian surveillance by government thugs or are you with the child pornographers?

Filed under: Cancon, Government, Liberty, Technology — Tags: , , , , , , , — Nicholas @ 10:23

Margaret Wente in the Globe & Mail:

Where do you stand on the new online surveillance bill? Are you with the government? Or are you with the child pornographers? According to Public Safety Minister Vic Toews, you have to choose.

In case you fail to get the point, the new legislation is being subtly marketed as the Protecting Children From Internet Predators Act. Of course, maybe you don’t really care about protecting children from Internet predators. Maybe you don’t care that without this law, filthy perverts will continue to roam free. Really, it’s your choice.

I am scarcely the first person to point out that Stephen Harper’s government likes to demonize its opponents, or that it has a nasty authoritarian streak. But in this case, the dissent is unusually widespread. Those with doubts about the bill include opposition politicians, civil libertarians, privacy commissioners and Internet experts — plus more than a few small-c conservatives who wonder why our government insists on whipping up unnecessary moral panic when it doesn’t have to.

[. . .]

So why do I stand with the child pornographers here? Because I’m not convinced the police need new powers to root out online child molesters. Judging by the recent highly publicized busts of child-porn rings, their existing powers seem to be working fine. Nor am I convinced that the police will never abuse their power. History shows they usually do. That’s why they need civilian oversight. That’s not liberal, in my view. That’s prudent.

The economics of the military-industrial complex

Filed under: Bureaucracy, Economics, Government, Military, Technology, USA, Weapons — Tags: , , , , , , — Nicholas @ 08:57

Eisenhower was right: the military-industrial complex has the US government tight within its grip, and there’s no easy fix. Strategy Page has a useful overview:

For decades the U.S. Armed Forces has been having problems with rapidly growing (much greater than inflation) costs of weapons. Congress passes laws to try and cope and the laws are ignored. One example is the laws calling for accurate life-cycle costs (for development, manufacturer, and maintenance of weapons over their entire service life). A recent study found out that, despite laws calling for accuracy and consistency in these numbers, most manufacturers manipulated the data to make their systems look less expensive than they actually were. The Department of Defense is increasingly taking extreme measures in the face of this corruption and cancelling more and more very expensive systems. But the manufacturers continue to use smoke and mirrors to get new projects started and failed ones funded.

New weapons get approved because of another form of procurement corruption, the Low Ball Bid. Last year the U.S. Air Force demanded that defense contractors stop low balling, which in practice means submitting unrealistically low bids for new weapons (to make it easier for Congress to get things started) and then coming back for more and more money as “unforeseen problems” appear and costs keep escalating and delivery is delayed. Currently, procurement projects are about a third over budget and most items are late as well. Procurement of weapons and major equipment make up about a third of the defense budget. While this is expected to decline over the next decade, as defense budgets shrink, the problem also extends to upgrades and refurbishment of existing equipment.

The most intractable problem is the decades old contractor practice of deliberately making an unreasonably low estimate of cost when proposing a design. The military goes along with this, in the interest of getting Congress to approve the money. Since Congress has a short memory the military does not take much heat for this never ending “low ball” planning process.

February 15, 2012

Stephen Gordon: The timing may be right for an austerity budget

Filed under: Cancon, Economics, Government, USA — Tags: , , — Nicholas @ 09:40

The federal government needs to rein in spending, and an “austerity” budget is intended to do that. Stephen Gordon points out that the US economy’s recent positive signs will increase the chances of budgetary success here in Canada:

For the first time in years, the economic news out of the U.S. is encouraging: a strong jobs report for January, a continuing fall in the number of initial claims for unemployment benefits, and even signs that its housing market may begin to revive in the near future. It may appear unseemly parochial to wonder what a U.S. recovery means for Canada, but that is the question that matters for Canadian policy making.

The recent recession should put to rest sayings such as “when the U.S. economy sneezes, the Canadian economy catches cold” to rest. The Canadian recession began almost a year after the U.S.’ did, was much less severe, and was over much more quickly. Nor was this an exceptional episode: the effect of a U.S. recession on Canada is much smaller than what is generally supposed.

The obverse side of this statement is that a strong U.S. recovery doesn’t guarantee strong economic growth in Canada. But it may be enough to offset the effects of an austerity program that will be much less austere than that implemented by the Chrétien Liberal government. In 1995, the federal structural deficit was on the order of four per cent of GDP, as opposed to 1 per cent now. Even if the Conservatives implement federal public-sector cuts similar in magnitude to those of the mid-1990s, transfers to provinces and individuals are to be spared.

February 13, 2012

SSDI “has transcended the usual ideological boundaries (as it was designed to do right from the start) and made tens of millions of Americans into wards of the state”

Filed under: Bureaucracy, Government, USA — Tags: , — Nicholas @ 11:38

Monty’s Daily DOOOOOM post at AoSHQ discusses the Social Security Disability Insurance program:

The SSDI component of Social Security is a perfect snapshot of how the welfare state both bankrupts and demeans our society. The program was meant to provide for people who were physically unable to work, but in practice it is simply another vast government program that can be gamed and cheated to provide a paycheck for no work at all. This is the welfare state in all its bureaucratic, amoral, spendthrift glory: rather than helping a relatively few who really need it, it instead enables millions of the able-bodied to avoid work. (Whatever you subsidize, you get more of. If you subsidize unemployment, you’ll get more of it.) Samuelson does a good job of explaining why this program will so hard to reform in any meaningful way, too:

    For starters, any crackdown could become a public-relations disaster. It might seem gratuitously cruel. Many recipients command sympathy. With low skills, their jobs prospects are poor. “People are driven into the program by desperation,” says Autor. Nor are they rolling in money; the average payment is about $14,000 a year.

Any attempt to tie off this spouting artery will bring howls of outrage, and not just from the left. To a large extent the welfare state has transcended the usual ideological boundaries (as it was designed to do right from the start) and made tens of millions of Americans into wards of the state. The end of the welfare state means the end of their monthly checks; it means the end of the “free” money they’ve been getting. Young or old, rich or poor, sick or healthy: it takes a rare soul to forgo “free” money in the face of some purely theoretical economic emergency. The welfare state will continue until this nation fails because, deep down, Americans don’t really want to give it up. Americans still — mostly — feel that if we just tweak this knob that way and pull that lever just so, it will all come out okay. It’s not so much good old American optimism as it is a deep and inchoate terror: the instinct of many an animal in dire peril is neither to fight nor run, but to crouch trembling where they are and pray that the danger passes them by.

How Greece got into their predicament

Filed under: Economics, Europe, Government, Greece, Politics — Tags: , , , — Nicholas @ 10:18

Anita Acavalos wrote this article in 2010. It’s still relevant — perhaps even more so today:

Although at first glance the situation Greece faces may seem as simply the result of gross incompetence on behalf of the government, a closer assessment of the country’s social structure and people’s deep-rooted political beliefs will show that this outcome could not have been avoided even if more skill was involved in the country’s economic and financial management.

The population has a deep-rooted suspicion of and disrespect for business and private initiative and there is a widespread belief that “big money” is earned by exploitation of the poor or underhand dealings and reflects no display of virtue or merit. Thus people feel that they are entitled to manipulate the system in a way that enables them to use the wealth of others as it is a widely held belief that there is nothing immoral about milking the rich. In fact, the money the rich seem to have access to is the cause of much discontent among people of all social backgrounds, from farmers to students. The reason for this is that the government for decades has run continuous campaigns promising people that it has not only the will but also the ABILITY to solve their problems and has established a system of patronages and hand-outs to this end.

Anything can be done in Greece provided someone has political connections, from securing a job to navigating the complexities of the Greek bureaucracy. The government routinely promises handouts to farmers after harsh winters and free education to all; every time there is a display of discontent they rush to appease the people by offering them more “solutions.” What they neglect to say is that these solutions cost money. Now that the money has run out, nobody can reason with an angry mob.

[. . .]

Greece is the perfect example of a country where the government attempted to create a utopia in which it serves as the all-providing overlord offering people amazing job prospects, free health care and education, personal security and public order, and has failed miserably to provide on any of these. In the place of this promised utopian mansion lies a small shack built at an exorbitant cost to the taxpayer, leaking from every nook and cranny due to insufficient funds, which demands ever higher maintenance costs just to keep it from collapsing altogether. The architects of this shack, in a desperate attempt to repair what is left are borrowing all the money they can from their neighbours, even at exorbitant costs promising that this time they will be prudent. All that is left for the people living inside this leaking shack is to protest for all the promises that the government failed to fulfil; but, sadly for the government, promises will neither pay its debts nor appease the angry mob any longer. Greece has lost any credibility it had within the EU as it has achieved notoriety for the way government accountants seem to be cooking up numbers they present to EU officials.

H/T to Steve Baker MP for the link.

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