Friday, October 15, 2010

My View

Random thoughts from a warped and fevered mind...

A little different "My View" this Friday. Hold on for the ride.

You remember the the Civics class you took in high school? You know, the one where you learned that a bi-cameral legislature wasn't one that had two cameras, but two chambers. Well, it's time to re-visit our civics class again, because apparently our great nation is woefully out of touch with some of the basics that should have been learned a long time ago. Today, we will start with a discussion of "government" and more specifically, what government can and - more importantly- cannot do.

The scope of government is limited by the legal powers enumerated in its constitution. At the national level, our constitution and the accompanying amendments provide they framework in which our government operates and what we should expect out of our government. We expect our government to provide certain "services", if you will, such as a national defense, the protection of private property, and the guarantee of our rights as enumerated  in the Bill of Rights. Government also regulates industries through laws, regulations, and taxes and tax credits. The "fee" for rendering these "services" is the taxes that are exacted from the citizens and the business community.

Outside of these particular functions, the government can do nothing else. Oh, I know we are are inundated with the bloviation out of politicians of all stripe that say that government must "create jobs" or "create wealth", but the truth of the matter is that the government can do no such thing.

Pay close attention. If you get this point, you will have more understanding than most in Washington and just about all the mainstream media:

The government cannot create jobs that pay for themselves and it cannot create wealth.

Contrary to the rhetoric we constantly hear, government does not create jobs that PAY FOR THEMSELVES.

Think about it. Worker A is hired by Company X. To justify their employment, worker A has to produce a product or provide a service to the customers of Company X that has to create enough income to cover the cost of worker A's salary and benefits and add profitability to the company's bottom line. There is productive activity that results in income flowing back to the company to pay for the salary of worker A and provide resources for Company X to continue in business.

Contrast that to worker B (see what I did there- worker "B"/ worker bee? Oh nevermind) goes to work for the federal government. How does worker B's salary and benefits get paid? Out of the revenue that is extracted from the taxpayer. After all, the government produces no goods or services that have a market value like does worker A. Worker B's salary and benefits are extracted from resources in the productive sector of the economy and transferred to the non-productive sector of government. The work that worker B does in the government does not pay for itself. Government work never has, and it never will.

I will stop right here to address the immediate argument that there are some government functions that we are more than willing to pay, such as a strong national defense. I wholeheartedly agree. The problem is the cancer like growth of government at all levels- federal, state, and municipal- that extract resources out the productive sectors of the economy and transfer them to  the non-productive sector of government. For instance, do we really need a department of the Federal government to tell us how our toilets should flush? Yet just one example of how our government continues to grow larger and more intrusive each year

Friends, it should be obvious to us what is happening. In the midst of one of the worst recessions in our nation's history, one sector has been growing rapidly, adding jobs at a remarkable clip. Yep, you know it.


This growth is being funded by working citizens and companies in the form of higher taxes and fees. Unless the trend is reversed quickly, our economic malaise will continue to worsen as more productive resources are sapped by a growing government.

So the next time that you hear a jobs report, and find that the bulk of the jobs are government sector jobs, realize that productive workers and business are transferring resources to a non-productive black hole that is known as government.

And know this. Government has never, and will never, create one single "job".

Next week: The myth of government wealth creation

Love is grand. Divorce is at least a hundred grand.

I'm wondering: does fuzzy math tickle?

Scientists have discovered that germs attack where people are the weakest. I guess that explains all the head colds.

And that, my friends, is my view.

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