Friday, July 31, 2009

What Is Wrong with This Picture?

House Votes to Give $2 Billion More to 'Cash for Clunkers'
Week-old government program to encourage car sales had proven so popular with consumers that it was almost out of cash. The House bill would redirect funds in the already-passed economic stimulus package that were intended for energy loan guarantees.

Kent Comments:

The government collects money from people.  Note:  there are many ways to do this.  People can be taxed.  Or the state can create more money from nothing, which devalues all existing money, thus taxing anyone who holds the money.  Or the state can borrow, which means – if it doesn’t repudiate its debts – that future people will have to pay.  Whatever the mechanism, the government collects money from people.

Now the government ‘gives’ this money to certain groups and certain transactions:  buying a car, buying a house, or whatever the favored transaction might be.  This is especially attractive during a (government-caused) recession.  Supposedly, the economy is being ‘stimulated.’

So what is wrong with this picture?  Isn’t it great that (some) people are getting new cars, houses, or whatever the favored product-of-the-month might be?

Problem the first:  people are spending in ways that are not their first choices.  There are those who would not have bought a new car, at least not now, without the government ‘paying’ them to do so.  Those who were forced to fork over the money to pay for this are also not buying (or saving) as they would have with the money that was or will be taken from them.

This in turn means that products are being produced that were NOT people’s first choice.  For example, more cars are being made because of all this, and while idiots in Congress along with our big-eared, big-mouthed President might think that is wonderful, it necessarily means that other things are NOT being made that would have been made – things people really wanted.

Problem second:  But the above are, to my mind, relatively minor economic problems.  (I say that with a sad, half-grin in place.)  The even greater problem is that a very valuable commodity is being extinguished in this horrible process.

When we allow the government to manipulate, even by ‘giving’ away money, what people buy, we destroy something important.  When we allow the government to take money from taxpayers, holders of dollars, or future generations to fund these sickening schemes, we exterminate something unseen but of greater value than all the automobiles that used to be made in Detroit.  When we allow demented demagogues to convince the ignorant or ignoble among us to go along with all this we deface something of great worth.

We destroy liberty.  On the list of endangered things, liberty should be number one.  And if you are one of those fools willing to trade your liberty for a new car, you deserve neither.

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