Friday, December 21, 2012

The one-two punch of America's fiscal pickle

Punch number one:  the welfare state.  "Looking at the West over the last century, the arc of history bends towards socialism and insolvency." So writes Patrick J. Buchanan in this gloomy take on our nation's fiscal prospects: Why God Created the GOP.  As Buchanan notes pessimistically, the federalized welfare state is here to state, and given the social and economic status of the country, it is unlikely to be pared back in any realistic scenario.  Too many have become too dependent for too long for the country to be able to readjust the size and scope of the welfare state to sustainable levels.  Add to this that the welfare state is also a vast employment program for government workers, and there simply is no realistic way to engineer real reductions in those programs.  As Buchanan puts it clearly, "[o]ur gargantuan welfare state of today, however, is permanent, as are the millions of government employees who milk and manage it."

Well, if social welfare spending can't be cut, couldn't the government work towards reducing at least part of its spending problem by addressing the bloated "defense" budget.  After all, why does American need to have bases in places like Germany and Italy, with World War II a fading and distant memory?  Why do we need all those planes and tanks and ships in a world where the U.S. military out-classes the next ten nations combined?  

Punch number two:  the military budget.  Those questions lead us to this post over at Reason.com, where Veronique de Rugy explains why cutting the defense budget is next to impossible:  Six Degrees of Military Spending.  As a practical matter, a huge part of the military budget, as she points out, functions as another form of social spending -- it is boosting employment in the civilian workforce.  While de Rugy ends her post hoping that some trimming of defense spending may occur due to fiscal pressure, I am not nearly so optimistic.  Cutting the military budget doesn't just mean fewer tanks, it means fewer civilian workers to build those tanks. In the current political environment, that makes cutting tanks an even harder proposition.

No comments: