Monday, December 10, 2012

Entitlements - Besides the Looming Economic Crisis, What Is the Real Problem?


The Progressive Era that began in the 1880s launched some badly needed reforms, including prohibitions on child labor, breaking up monopolistic trusts, correcting labor injustices, and not to mention, women's suffrage. Political bosses and financial oligarchs used to create the reality of life, and the average citizen was left to the whims of The Man. But another dynamic of the progressive movement, one based on good intentions, was the notion that the government should take care of people and protect them from the problems of life. Government came to be seen, not just as an apparatus of enforcing objective laws, but as a machine for setting right all of the wrongs of life. What has happened in the nation, especially since the 1960s, has been a vast expansion of what is considered a right. The Constitution was written as a document that basically said what government couldn't do. It is now thought of as a font of individual rights that beg to be asserted. We cherish our civil rights and our property rights, but just what you have a right to has now come to be thought of as a piece of property.

Thus began the growth of the entitlement state, a state where the government would provide you with goods and services that you might have to do without if left to the uncertainties of living. This philosophy of government saw its real flowering during Franklin Roosevelt's New Deal in the 1930s. The idea that competition and free markets would provide for the greater good crashed head-on with the Great Depression. The belief took hold that capitalism somehow had failed. Books are still being written disputing that notion, and there are cogent arguments that the New Deal programs such as the Works Progress Administration and the alphabet soup of other federal programs actually exacerbated the depression. Unemployment was about the same in 1939 as it was in 1930. But the historical truth has been written: we are a nation increasingly in love with our government-provided goods and services, our entitlements.

The major entitlements in our country are Social Security, Medicare and Medicaid.

The problem with entitlements is contained in the very word itself, the idea that we are entitled to this or that governmental benefit, not that the benefits seem like a nice idea, but that - "It's mine; fork it over." The benefit has become a right. If you think otherwise, look to the headlines from Europe about violent riots against any government move to reduce state spending by scaling back on the sacred entitlements. In France 20-somethings torched cars and smashed windows because of the horrible specter of having to wait until they are 62 to retire, rather than 60. Poor dears. In Greece, where cheating on taxes is a national pastime, similar riots occurred over government moves to reduce benefits. Here in America we see students demonstrating against any increase tuition increase at state-run universities. As the nation still struggles from the aftermath of the Great Recession, discussions of public employee union give-backs or even future trimming is met with stanch resistance. Teachers unions rail against any discussion of lay-offs, but adamantly refuse to take a pay cut or even agree to a lower annual pension increase. "Don't lay off my colleagues, but if keeping them on the payroll means reducing my benefits, by all means do so."

This is the real problem with entitlements: they corrupt civic virtue, that commonly understood concept of shared responsibility and shared sacrifice. Civic virtue asks us to look beyond our parochial interests from time to time, and consider the wider good. Entitlements change us as people, away from the notion of the common good, to a people who want theirs, the common good be damned. Entitlements infantilize us. Try negotiating with a 5-year-old. The kid is hungry and wants to eat, NOW. You try to explain that the next rest stop is 50 miles away, and you will pull off then for lunch. Good luck. Now means now, and don't talk to me about this reality stuff. Compare this to a public employee union that wants both a raise and pension benefit increase in this contract, now, even though the revenues to pay for the raises have been slashed because of economic conditions.

It is now an open secret that lavish publicly funded pensions are based on ridiculous actuarial assumptions made years ago by politicians who are no longer in office. As New Jersey Governor Chris Christie so aptly put it: "The chickens have come home to roost." But don't talk about economic hard times and the inescapable reality that the fiscal status quo is impossible. Now means now. Only recently has it become possible for a politician to actually suggest that our economic future demands that we trim entitlement spending to conform to reality. The problem has always been, and still continues, that once an entitlement becomes a fact, people are loathe to let go. That's why they are called entitlements.

Entitlements are good for lawyers. When a benefit becomes an entitlement through law, withholding that entitlement means a violation of law, and the job of correcting that problem falls to lawyers - and bureaucrats. Everybody loves to blame lawyers, but the blame is misplaced. If a client walks into a lawyer's office and presents a set of facts that the lawyer determines to be a violation of, say, the Fair Labor Standards Act, it is the lawyer's job to seek to seek justice for the client. It's not just his job, it's his sworn responsibility. It is not the lawyer's job to say to the client that this particular entitlement is crazy and that it destroys jobs and will damage the economy. No. It is the lawyer's job to act on behalf of his client.

Entitlements put our moral sensibilities on automatic control.

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