Saturday, February 28, 2009

Thursday talk radio update II

I have been remiss in failing to mention Yellowstone Public Radio's weekly wrap-up of the Legislature with Jim Gransbery and Jackie Yamanaka. It's always interesting and sometimes enlightening.

But this week I heard Scott Sales say two things that made no sense to me.

One is an old bugaboo: He said that Montana government has to learn to live within its means. What can this possibly mean? As I have argued before, government has no means. It does provide services that are of value: running water, sewage, garbage pickup, police and fire protections -- and that's just at the city level. But government has no power to simply charge market rates for those services. Instead, it can charge only what its customers, acting through their elected representatives, permit.

So when Sales, who was elected to help decide what means government should have, says that government should live within its means, what is he trying to say? That government's current means are by some miracle optimal and should never be changed? That we no longer need a more perfect union because the union is now fully perfected? Or what?

The other thing he said was that we can't spend our way to prosperity. I hear this all of the time, but does anyone believe it is true? People spend their way to prosperity all of the time. It is, in fact, the basis of the capitalist system: Somebody gets an idea for a product or store, raises money through investors or loans or savings or inheritance, spends the money to launch the product, and rakes in the prosperity. It's a great system. A major reason why new businesses fail is insufficient capitalization, i.e, they can’t afford to spend their way to prosperity.

The same is true at both the individual and government levels. Take a smart, poor kid out of the ghetto, give him some decent clothes and an education, and he is likely to prosper. Maybe he could do it anyway, but the money helps.

In the same way, a country invests millions in building an interstate highway system. Next thing you know, there’s a Town Pump at every exit. Guess what: We just spent our way to prosperity.

Obama proposed, and Congress has passed, a massive attempt to spend our way to prosperity. Even Sales acknowledged that it might help in the short run. And the short run is all that matters. Everybody knows we can't just keep spending money forever. The theory of the stimulus is that it will relieve some short-term pain for the unemployed, help keep government employees on the job, stabilize the economy, and help fuel a recovery. I'm the first to admit that I have no idea whether it will work. I suspect that Sales doesn't either.

So what does Sales really mean? I think he means that taxes should never be raised and that he doesn’t want to spend money to fight the recession. So why not just say so? Why dress it in clich├ęs, as though it were the wisdom of the ages?

2 comments:

Anonymous said...

"...we are partners in our government. We need to be fiscally responsible and live within our means." -- Brian Schweitzer in 2/28/06 press release on proposed tax rebate legislation.

The budget for the upcoming biennium "will permit the State of Montana to continue to live within its means and will offer sustainable solutions to fund state services." -- Governor's office goals and objectives, 2011 biennium.
http://governor.mt.gov/governor/goals.asp

It is interesting how a cliche like this doesn't become nonsensical and stupid until it is uttered by a Republican.

David said...

Schweitzer isn't a Republican?

Actually, the cliche does make a bit more sense coming from the governor, since he was clearly talking about living within the means provided by the tax rules passed by the Legislature. It really makes no sense only when it comes from the people who actually make those rules.