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Tuesday, May 2, 2017

Fiscal Conservatives, Unite!

During World War II, when British troops were advancing in eastern Africa, they came upon a large force of Italian troops. Vastly outnumbered, the Brits feared a bloody battle, but to their joy and relief they were greeted not with artillery fire and bullets, but with deserting Italian soldiers. As the British troops were scrambling to organize their volunteering POWs, the Italian general walked up to a British captain, handed over his handgun and fell on the Brit's shoulder, crying profusely over the lack of morale and patriotism among his troops. Offering the general a drink, the British captain spent the better part of the day providing makeshift therapy for the demoralized general.

As I read about the latest stopgap budget measure in Congress, I was reminded of this story.
Once again, the Republican majority in Congress has failed to act like fiscal conservatives. Democrats did not even have to show up for the fight - all they had to do was whisper "shutdown" in the hallow hallways of Congress. The mere echo of that word sent rank and file Republicans running in all different directions, like deserting Italian soldiers. 

Speaker Ryan has once again demonstrated leadership skills worthy of an Italian general in the face of battle. He was last seen crying on Senator Schumer's shoulder. 

This is not really surprising, but the fiscal debacle in Washington is yet another stern reminder to us here in Wyoming that we cannot wait any longer with turning our own pledge to fiscal conservatism into practice. We must stop talking about fiscal conservatism and economic freedom. We must start acting like we have at least a fragment of the backbone of our Founding Fathers. 

There is a profound practical meaning to this. Before I get there, though, let me take a step back and ask: What is the only prevailing economic trend in America over the past century?

Growing prosperity? No. Well, not quite: for the better part of the 20th century, we more and more prosperous, with each new generation going into adulthood with the prospect of a better life than their parents had. But that trend faded into the annals of history some 15 years ago. Since then, we have had no real expansion in prosperity, no real rise in our standard of living. 

No, the only prevailing economic trend in the American economy is the growth in government. Today, we have an egalitarian welfare state that grows by its own inherent force, until it has consumed its host organism and our country starts suffering from the same social and economic ailments that have brought Europe to economic standstill and sprawling political disarray. 

Today, we have a legislative spending habit where a reduction in spending growth is considered a "cut" in spending.

In a nutshell, that legislative habit has turned into an overall "government first" political strategy, one that has obviously consumed Congress - but which has also set disturbingly deep roots here in Wyoming. 

It appears unlikely that we can do much to nudge Congressional Republicans in the right direction. The election of Donald Trump for president has changed some things for the better, but he will have no chance of reining in federal spending so long as Republicans on Capitol Hill continue to pledge unbreakable allegiance to every penny of government appropriations.

For this reason, we here in Wyoming must - again start acting like we have some kind of liberty-minded backbone. We must turn that spirit into political and legislative practice. 

To do that, we must do two things.

1. No, no and no to higher taxes and new taxes. We must voice, vocally, our opposition to an income tax. Yes, I know: nobody has proposed an income tax. Not yet. But so long as our state legislature fails to do anything substantial about state government spending, the budget deficit will continue to rise. Furthermore, the tactic applied by the legislative leadership and Governor Mead to turn our state's fiscal crisis into a "school funding" crisis is a way to try to:


Simple logic dictates that this means higher taxes. A simple review of our current taxes concludes that the legislature will not be able to recalibrate spending without introducing an income tax. 

An income tax will not be the solution to our state's revenue problems. It will be a macroeconomic death blow to Wyoming - and only the beginning of a new state spending spree. Remember what happened after the 16th Amendment created the personal income tax in 1913? Congress got their hands on an endless flow of new revenue. With some 80 percent of federal tax revenue coming from the personal income tax, it is easy to imagine what the federal budget would look like today without the 16th Amendment.

It is also easy to imagine what our state legislators will do if they can plug another tax revenue pipeline straight into their budget. 

Alas, no, no and no to new and higher taxes.

2.  Yes, yes and yes to structural, permanent spending reforms. Fiscal conservatism is not just a theory. It is a political and legislative practice. It means something in real life, something tangible. It means reducing the size of government, returning responsibilities to people - and doing it permanently.

Here is where fiscal conservatives get scared. Like kids dipping their toe into the cold lake before the first swim of the spring, many fiscal conservatives get worried when they are faced with the realities of what real reform actually means. Overcoming that fear is absolutely essential. It is time to stop finding excuses for not pursuing real school-choice reform; it is time to stop looking for reasons to not privatize Medicaid; it is time to quit worrying and actually work for privatization of welfare, to put tolls on I-80, and to create public-private partnerships wherever full privatization is not suitable.

Going from theory to reality involves doing more than overcoming the fear of that cold lake water. It involves something that fiscal conservatives appear to be notoriously bad at, namely uniting around a strategy of incrementalism. 

One reason why Congressional Republicans have now handed over Congressional leadership to the Democrat minority is that they prefer to Balkanize as soon as a reform opportunity arises. They split into fractions, each demanding their own particular brand of government reform, and if they don't get every bit of it, they want no part of what anyone else gets. Rather than negotiating across the dividing lines of the fragmented fiscally conservative landscape, they hold out and let the statists on the other side of the aisle score yet another big victory for big government. 

The same tends to happen among fiscally conservative grassroots, especially under the banner of school-choice reform. Rather than the opportunity to celebrate a small victory together, fiscal conservatives tend to want to celebrate that they did not concede an inch of their ideal reform to their evil fiscally conservative rivals next door.

It is time to stop Balkanizing on fiscal conservatism. It is time to realize that fiscal conservatism has never celebrated a major victory anywhere in the country (tax cuts without spending cuts are not victories - just infusions of life support into an ailing welfare state) and that it is better to be the first to win such a victory, than to be the last holdout by means of whom the statists will get to spend even more of our money.
We have never rolled back a single entitlement program in the history of either the United States as a whole, or Wyoming. Breaking the trend of unending growth in government is a bigger victory than getting everything we want at once.

1 comment:

  1. We are addicted to spending. It does not matter which party you are a part of. We are ALL addicted to spending.

    ReplyDelete