Shoring Up the Nanny State

Tibor R. Machan

Given how bad the arguments are for forced wealth redistribution, it is no great surprise that mainstream welfare statists are constantly revamping them. In the August 22, 2007, issue of the International Herald Tribune, the European paper that’s put out by The New York Times, an editorial makes yet another attempt to help give the nanny state the moral advantage. Let us take a look at how this attempt is made.

“...The United States has long had one of the most meager tax takes in the industrial world. America's social spending—on programs ranging from Medicare and Social Security to food stamps—is almost the stingiest among industrial nations. Among the 30 industrialized countries grouped in the Organization for Economic Cooperation and Development, only four—Turkey, Mexico, South Korea and Ireland—spend less on social programs as a share of their economy.

“Long a moral outrage, this tightfisted approach to public needs is becoming an economic handicap. Shortchanging public health impairs America's competitiveness. If the United States is to reap the rewards of globalization, the government must provide a much more robust safety net—to ensure public support for an open economy and protect vulnerable workers.”

To appreciate these desperate lines, it is necessary to render them into more honest terms. So, first of all, what we are actually being told is that the United States has achieved what in human history cannot be but a triumphant accomplishment—it extorts far less of its population’s resources than do other countries; most of them are still stuck in the ethos of pre-capitalist economics, mercantilism, where the government manages the bulk of the economy (i. e., its citizens). Instead, in the USA economic challenges are dealt with mostly by free men and women, not by politicians and bureaucrats.

Instead of lamenting this, it ought to be celebrated. What else is due a country that has managed to substantially abandon the notion and practice of having its population live off the work and resources that are extorted from its productive citizens? Instead of depending on kings, tsars, pharos, and other rulers of the realm, in America individuals and families are starting to fend for themselves by means of voluntary cooperation—trade, insurance, inheritance, etc. And they are exporting this idea to many other regions of the globe via globalization and privatization.

To call advancing toward greater self-sufficiency by a substantial portion of a country’s population that has become less and less dependent upon the government “a moral outrage” is to engage in Orwellian doublespeak. It is a moral triumph not to depend upon stealing from Peter to provide for Paul and to provide a legal infrastructure in which both Peter and Paul have an excellent chance of flourishing economically (and otherwise).

But there is also a problem with the facts in those two passages. While certain kinds of taxes are lower in America than elsewhere in the industrial world, other types are more Draconian. All the hidden taxes involved in the extensively regulated economy which people in commerce need to pay by way of vast bureaucracies and legal teams, are not accounted for. Firms need to pay vast sums so as to fend off the feds, to cope with anti-trust suits, etc.!

The so called public health problems in the USA, such as they are, are mostly the result of the government’s extensive intervention in medical and insurance matters—the health professions are the most highly regulated by the governments in the country. Only education is more socialized, from elementary to the highest levels.

This idea, that “If the United States is to reap the rewards of globalization, government must provide a much more robust safety net—to ensure public support for an open economy and protect vulnerable workers” is utter nonsense. Governments must steal any provisions to make them available, which then means resources that people might allocate according to their own understanding of what they need and want are being managed by people who are clueless as to what actually needs to be produced.
The idea also lacks the benefit of the insights of public choice theory, namely, that politicians and bureaucrats are far from public servants. Instead they pursue agendas of their own depriving the resources from those who produced them and thus rendering them unavailable to be used as their owners would chose. Local knowledge is a far better guide to what is needed than the ideas that legislatures and bureaucracies concoct about the public interest (which is really mostly private interests having been lobbied for successfully).

In fact the nanny state is mostly a matter of providing appealing intentions, not of coming up with successful performance. No doubt, some folks benefit from its policies but never without imposing the cost on others who then are stymied in their efforts to pursue their goals. And there is nothing to celebrate about that.