Governments have no resources. For further evidence, contemplate a recent post by Adam Michel at the Cato Institute.
Michel’s Cato at Liberty headline was “Who Will Pay for Democratic Socialism’s $200 Trillion Cost?” The speculation here is that he would agree the headline gave the wrong impression.
It can be found in all the excitement the title elicited from conservative media. Fox News, Newsmax, and The Ben Shapiro Show (among others) went into rapture over a takedown of the surely bankrupt nature of the Democratic Socialists of America.
Ok, but Michel knows as well as anyone that governments have no resources.
He knows that governments don’t get their spending power from Pluto, or central banks, rather they attain it through their taxable access to the most productive people on earth. Which points to the problem with Michel’s headline.
Implied in it is that Pluto or central banks do provide consumptive power to governments. What else could explain the projected, $200 trillion cost of Democratic Socialism?
Of course, in Michel’s projected cost readers can hopefully see the flaw in the headline: democratic socialism will never cost $200 trillion simply because the policies associated with it are as Michel alludes, inimical to prosperity.
For evidence of the above claim beyond basic common sense, we need only point to the last time collectivism was tried around the world: the 2nd half of the 20th century. That it was an abject failure is a blinding glimpse of the obvious, one that revealed itself in the governments practicing it having very little in the way of resources to do much of anything with.
Said another way, democratic socialism will never happen because of democratic socialism. Get it?
Ronald Reagan at least did. That’s why he knew when others didn’t that the Soviet Union’s days were numbered. Since governments have no resources, there was no way Soviet defense spending could come anywhere close to the spending of a federal government that leaned toward personal and economic freedom, and that for leaning that way, would have copious resources to substantially outspend the government that promised abundance via collectivism.
Said yet another way, and as Michel's charts allude, the promises of democratic socialism can only be fulfilled even a little by a government with taxable access to prosperity, but then democratic socialism suffocates prosperity. Which was the problem with Michel's headline. Democratic socialism would never cost the U.S. Treasury $200 trillion, let alone $2 trillion, simply because a government abiding the policy failure implied in democratic socialism would never have $2 trillion or $200 trillion to spend in the first place.
Government spending doesn't boost the economy (quite the opposite, by definition), but governments very much require prosperity to attain spending power.
Michel expectedly channeled Margaret Thatcher at post's end with a line about how “there aren’t enough rich people or corporations to pay for Democratic Socialism.” Well yes, and that’s why it will never happen. There's once again no way democratic socialist governance could shower government with the revenues or expected revenues (thus enabling debt) necessary to fulfill even a tiny portion of its promises.
Michel followed his Thatcher-ite quip with a warning that “Eventually, the bill will come for the rest of us.”
Except that the rich pay all the taxes, by far. As in if the bill were ever going to be left to “the rest of us,” then democratic socialism could never be implemented in the first place. Get it?
