Economic Literacy 101

sandersAmerica’s 18- to 34-year-old “millennials” have been tutored in group-think schools that extol socialism. Now they lionize liberal politicians whose class-warfare prescriptions include taxing away all but maybe 1% of the nation’s 0.0001% billionaires’ wealth, then going after Wall Street, Big Business, millionaires and upper middle classes – and giving the “revenue” to those who “need” or “deserve” it more.

The entire process revolves around three central questions. Which ruling class elites get to determine who loses, who wins, by how much? Who grants them the power to do so, and holds them accountable? And what happens when the inevitable discontent over their autocratic decisions boils over?

Interestingly, many of the same generation have flocked to see films that glorify individual liberty and defiance of centralized government control. In The Hunger Games, a few small gestures of disobedience grew into a revolution against Capital elites who lived well and ruled imperiously, while subjugated masses in the Districts starved in poverty and sent their children to die in televised “hunting games.”

In Divergent, a Faction system preserves a society that primarily benefits the ruling Erudites by stifling individuality. The heroes and heroines refuse to confine their lives and ambitions to only one of the other four factions in which they were placed at age sixteen. Again, the ruling class lives far better than the ruled masses. (Ponder the politicians, bureaucrats and lobbyists in counties around Washington, DC.)

Are so many millennials really willing to let ruling classes confiscate wealth, impose penalties, determine appropriate welfare payments, and dole out favors? Has their “education” made them incapable of understanding the blessings of liberty, free enterprise capitalism, reliable and affordable fossil fuel energy, and entrepreneurial opportunities? Have instructors so brilliantly presented socialism through rose-colored glasses that young voters are blissfully unaware of its abject failures and horrid excesses?

Are millennials perhaps a little schizophrenic – loving liberty in theory and celluloid, but content to live reality in the Districts, among the Amity and Abnegation Factions, enjoying the bread and circuses (welfare payments and show trials for humbled banker and corporate bigwigs) bestowed upon them? Or perhaps they assume they will be among the Capital’s Erudite and Candor classes, governing the rest of America, in the name of justice, fairness, diversity and equality?

They seem to view free or low-cost college tuition, child care, healthcare, food and housing – along with $15-per-hour “living wages” for entry-level jobs … six-figure incomes after college … and “safe zones” – as “basic constitutional rights.” But when they “feel the Bern,” have they pondered how this system must necessarily work in the Real World, where they will feel the actual burn?

As the late Southern Baptist pastor and author Adrian Pierce Rogers succinctly explained, the hard reality is that “government cannot give anything to anybody that it doesn’t first take from somebody else. What one person receives without working for another person must work for without receiving.”

That is precisely what Senator Sanders’ wealth taxation and redistribution scheme proposes to do. The problem, as former British Prime Minister Margaret Thatcher astutely observed, “is that eventually you run out of other people’s money.” Even in the wealthy United States, “eventually” would come quickly, because socialism destroys the incentive to work, innovate, invest, take risks and create new wealth.

Ultimately, nations are left with a large and growing population of have-nots who demand more – when there is no “more” to be had. That is what Italy, Greece, Portugal, Spain, Argentina, Brazil, Cuba, Venezuela and other socialist, populist, egalitarian paradises have been discovering.

They used to provide all kinds of free stuff. Today they are basket cases – struggling with anemic growth, recession, bankruptcy and government “junk” bonds that no sane investor wants.

Today, 59% of young Greeks are unemployed. Youth unemployment is 56% in Spain, 42% in Italy, 38% in Portugal. In Brazil, electricity rates soared 51% last year, food prices rose 15% and overall inflation stood at 11% – a vast improvement over its 5000% annual inflation rate (!) in the early 1990s but still awful. In all of Latin America, only Argentina at 27% and Venezuela at 200% had worse inflation.

American students are immersed in “sustainability” studies and projects, mostly based on still persistent notions that we are running out of essential resources and destroying Planet Earth. Those ideas are the foundation of policies and regulations that perpetuate what really is unsustainable: unemployment, government spending, anti-growth policies, and the anger and unrest they cause.

It may be, as Winston Churchill once observed, that “the inherent vice of capitalism is the unequal sharing of its blessings.” However, he continued, “the inherent blessing of socialism is the equal sharing of misery and scarcity.” Unfortunately, simple, basic truths like this are rarely taught in our schools.

Students today want equality of outcomes, rather than of opportunities that yield positive outcomes and potentially rich rewards by dint of hard work. If millennials applied their socialist principle to grades – with all scores on exams and projects averaged out among the smart and less talented, the hard-working and deadbeat – shiftless classmates would be happy to coast along, once ambitious scholars would exert far less effort, and all would soon flounder in a sea of F’s.

Similarly, socialist policies stifle the innovation, economic growth and job creation that young people need if they are to get beyond minimum-wage service jobs, and out of their parents’ basements.

Free tuition? City University of New York had that for awhile, until 1976, when it ran out of money and the city nearly went bankrupt. Even Sanders admits his plan would cost yet another $750 billion over ten years. But perhaps it would work if half of the administrative positions were eliminated, faculty salaries got a 25 or 35% trimming, and sabbaticals came just once a decade.

Surely the “progressives” who rule our campuses – and try to ban and silence contrarian speakers like Ben Shapiro – would support this to ensure “free stuff.” Surely, the next Erudite and Candor egalitarians in The Capital would be content with salaries that are no higher than those of the masses they govern.

Bottom line, the bills must eventually be paid. Millennials may get free stuff today. But they and their children and grandchildren will pay for their freebies many times over, through higher taxes, increasing control over their lives, higher inflation, fewer jobs at reduced salaries, and lower living standards.

As to accountability, government excels at fining and jailing citizens and businessmen for violating any of the thousands of regulations that carry criminal sanctions, even if the “perpetrator” did not intend to violate the rule or had no clue that such a rule could possibly exist. But the ruling elites apply very different standards when the incompetent or criminal actions of their own agents are involved.

Thus a rancher is prosecuted for “terrorism” for accidentally burning 139 acres of national forests, but government officials get off scot-free when they torch 160,000 acres mere miles away. Citizens go to prison for inadvertently “impacting” wetlands, but EPA bureaucrats receive get a pass cards when they deliberately open an abandoned mine and unleash 3,000,000 gallons of toxic sludge. IRS directors simply “take the Fifth” after targeting conservatives and destroying records, and an OPM director resigns rather than testify about how her screw-ups let hackers get personnel records – while private citizens are hounded and threatened until they cave in or run out of money to defend themselves.

The more government control and socialist wealth redistribution we get, the worse these abuses become. Will the socialist voters demand accountability? Or do they simply not care when ruling elites and their cronies violate laws and abuse their public trust, to advance agendas or enrich and protect themselves?

All these questions would generate very interesting discussions with socialist candidates and voters.

Paul Driessen is senior policy analyst for the Committee For A Constructive Tomorrow (www.CFACT.org) and author of Eco-Imperialism: Green power – Black death.

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  • Avatar

    Amber

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    The problem with artificially propping up
    the economy in a cycle of greater and greater dependence on government is bailouts and regulation create fertile ground for socialists . MIllennials have seen nothing else and many have put their lives on hold getting degrees
    from left wing institutions .

    Sooner or later governments will run out of ammo and point the finger at the private sector blaming them for the mess .

    When the millennials can’t get jobs and are about 30 they will begin to wonder if
    socialism is the way to go . But who knows, maybe they are equally fed up with corporate bail outs and hedge fund billionaires buying the White House too .

    Reply

  • Avatar

    Acttorneyatliar

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    #1 Amber, I agree with you completely, but would just note two things: first, unemployment is already rampant among both the millennials and those who lost work and have left the work force – and whom the liberals refuse to recognize when Obama sells the nitwits who adore him his dumb assertion that the economy is just sailing along because of him; and two, at least corporations and hedge funders pay taxes and employ people. The government does neither. It is strictly and by definition nothing more or less than a drag on our economy. It creates nothing and provides only what it is given by those who do. Problem is, the liberal government has made itself into a tremendous funnel of the producers’ tax dollars directed at donors to their unsustainable socialist cause and the tremendous class of takers whom the liberal government has created by overregulation of business – driving it to foreign shores, excessive taxation of We the People who have jobs which allow us to pay taxes, and the vast expansion of those dependent upon empty liberal promises and “gimmes.”

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  • Avatar

    prestigio

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    all forms of taxation
    no matter how necessary
    reasonable or trivial
    depress economic activity

    the tax man is a
    leach who draws off and
    eventually destroys
    a free flowing economy

    no economic theory
    shows the tax man as
    anything other than
    a parasite

    Reply

  • Avatar

    GESchroeder

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    This is an excellent, well written article. It is the best I’ve ever read on this topic.

    Reply

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