Saw one of my favorite Docs today and told him of the dismal projections for our country discussed at this week’s Reno Hayek Symposium Dinner, the current and future deficits, the debt, the unfunded liabilities and on top of all this the Omamacare sludge hammer. We both pondered the “no way out-no apparent solution” future. The concern here is for our children and grandchildren. And, its not that they can’t be better, be more independent than we, but that we are saddling them with unimaginable debt burdens so bad that they can’t be overcome no matter how strong they are.
We then discussed the untenable tax burden necessary to barely maintain but not reduce these entitlements, their corresponding debt and merely the interest cost necessary to maintain both. This is not a tax the rich issue, the rich will no longer be here or anywhere for that matter. This is a gigantic burden on the middle class; the less-than-middle class pay no taxes, and in fact have payments going to them. The anticipated 20% VAT tax atop the increased income tax and estate tax will not come close to solving the problem. In fact this tax on consumption will merely accelerate the downward spiral in our consumption based economy. This because consumers will be further forced to hunker down, down to a subsistance existence.
We pondered the all-but-impossible solution of reducing entitlements arguing its necessity but also its political impossibility. Then we broached the real issue, equality.
This, discussed initially in medical services. Should we all be entitled to the best, the Mayo clinic, the latest technology? Or should only those who can afford the best be able to buy it? In Europe it is the entitlement scenario, but the best becomes the non-best. This because the best requires capital investment at risk for long duration and problematic results. My Doc pointed out that med-tech investment is down! In Central America medical treatment and services are pretty good and the tech used is state-of-art but only for those who can afford it. The lower classes are relagated to a lower level of care above first aid but not the best available.
What as a society do we want for our society? What as a society can we afford for our society?
I think it gets down to two issues: the proper role of government and the moral responsibility of the individual. Government must defend our shores first and formost. It must enforce criminal laws protecting person and property. It must maintain a system of civil justice resolving disputes between citizens. And given our republic structure it must resolve issues between states. Finally it must provide for its continuance, succession and amendment. Our founding fathers pretty well set this out initially in the Declaration of Independence and later in the Constitution.
I think the proper role of the individual is to provide for himself and his family; that is food, shelter, education and protection. Beyond that the individual must be a contributing member of society helping his fellow man in need. This frequently through synagogue, temple or church and also through voluntary community societies. The individual must also be a responsible citizen, voting, volunteering, and participating in government offices when elected or appointed.
What of equality? What of entitlements? We are not “all created equal” nor has history shown us to be “endowed by our Creator, with certain unalienable rights” of life, liberty and the pursuit of happiness. The closest we come is to expect “equality of opportunity” despite our limitations. “Equality of result” is never attainable. Nor are we “entitled” to be equal. We struggle to do our best for ourselves, our families and our society. But we are not entitled to nor should we be guaranteed the same as everyone else.
This realization gives us the opportunity to help others, to be charitable, to do moral good. Including providing charitable hospitals and medical care, to get back to the earlier example. Here the government has no role; it is the exclusive role of the individual with other individuals alongside.
So, to prevent or at least mitigate the greatest intergenerational immorality in our history, we must limit entitlements, reducing and means restricting social security, medicare, medicaid and Obamacare. Keep in mind our grandkids have no voice, they are innocent of our current theft of their future. Our parents, the greatest generation, left us a better future but perhaps one too soft. Will we do worse by our children and grandchildren?