Friday, August 10, 2012

Moving to Higher Ground, Part 5

The list of what to discard is long indeed; this is not surprising in the face of the huge flood of debt at the federal level. We need to refrain from sending our young men and women to fight when we or our close allies are not directly threatened. We should leave behind the attitude that the purpose of our defense budget is to provide jobs; rather, we should spend only what we need to keep the country safe from attack. We should phase out programs like Social Security and Medicare which tax the young to subsidize the old; we should save for our own needs and use government money to assist only the truly needy. We should abandon our current tax code in favor of a negative/flat tax (described by Dr. Milton Friedman) and abandon tax policies which favor income from interest and capital gains over income from work. We should abandon the corporate income tax which reduces the flexibility of our corporations; rather we should tax the profits when people receive them (dividends or capital gains). Our federal government should leave behind subsidies for food, mortgage interest, health insurance, and education; subsidies tend to raise prices and the money which we send to the Department of Education in Washington is needed at the school down the street where we send our kids.
Our federal government should leave behind support for unions, public and private; unions institutionalize adversary relationships which weaken companies, cities, and states and contribute mightily to the flood. Our federal government should re-learn the lessons of the prohibition of alcohol (our 18th amendment to the constitution) and its repeal (our 21st amendment) and apply those lessons to repeal drug prohibition. We must leave behind anti-trust laws which kill innovation or prevent companies from gaining efficiencies; government regulators are never smarter than free markets. The government should leave behind tariffs which interfere with free trade and penalize consumers. We must leave behind the unregulated jungle of tort actions and class-action lawsuits that lead to company-killing penalties and outrageous medical malpractice awards (in the absence of criminal intent), and unaffordable malpractice insurance. Our government should repeal the law against work, the so-called "minimum wage;" we need all the willing, able-bodied workers we can find and now is not the time to prevent people from working just because they cannot command a wage set arbitrarily by people who know nothing about their situations or about the situations of their potential employers.
Good luck to us all in the rising flood of debt. As we seek higher ground, the better decisions we make, regarding what to take and what to leave behind, the better chance we will have to survive and to gain a higher quality of life. As I survey my own situation and the situation of the company where I work, I have a good idea of what to keep and what to abandon. When it comes to my local, state, and federal governments and the candidates for office in the coming elections, I intend to support those whose concept of what to save and what to leave behind comes closest to my lists above. If those candidates fail to win election, I fear that the flood will be wide, deep, and long.

Tuesday, August 7, 2012

Moving to Higher Ground, Part 4

State government, the mid-level of the public sector, has shown a capacity to enrich our lives and impoverish us. In my own state, I have seen the establishment and growth of an enormous system of state universities, colleges, and (two year) community colleges. While it is highly debatable whether our formal educations need to be quite so long – into our 20s and even our 30s – there is no doubt that the universities, public and private, of California have spawned a diverse private economy. To the extent possible, I would like to keep most of this system. The state is also responsible for highways, water resources, prisons, and parks. Although there are many opportunities for economies (staggered work hours to reduce traffic congestion, market pricing to conserve water, decriminalizing drug use (a federal issue) to reduce court caseloads and prison populations, and user fees from parks kept separate from the general fund), I recommend that the state continue to provide these services.
To make state government more affordable, I recommend that state employees be made responsible for their own health and retirement plans. As for cities, state public-employee unions should be discarded. Where there are shortfalls, it will fall to students to make up the difference between the cost of their education and what the state is able to fund. One approach to closing this gap is for students to do more of the maintenance and administration work of their educational institutions. This would give students real work responsibilities and experience at a time when, for some, formal education has become disconnected from the private workplace. It would also give students a greater stake and more pride in their own campuses.

Wednesday, August 1, 2012

Moving to Higher Ground, Part 3

At this time (summer 2012), with the seemingly endless political campaigns about to enter their final phase, it will be interesting to see whether our aspiring decision makers mention the flood and whether they appear to perceive the potential effects. More to the point, it falls to us, the voters, to select those candidates who are aware.
Even though they tend to claim less media attention and a smaller share of our taxes, local governments do most of the work and have the greatest impact (among the public sector players) on our lives. I value and suggest that my city government continue to provide these services: police and fire protection; municipal, superior, and small-claim courts; detention facilities; street and sidewalk maintenance; traffic supervision and safety; sanitation and trash collection; elementary and high-school education; city parks; libraries; and support for construction in the form of zoning, licensing, and inspections.
In order to continue to provide those services, I would like my local government to discard budget deficits, closed council meetings, and unions. Deficits have no place in city government which (thankfully) is neither authorized to print money nor entitled to spend more money than the taxpayers can afford. All spending decisions need to be made in open meetings, accessible to city residents. Public unions represent a clear conflict of interest: union members use taxpayer money and campaign for city council members who further union goals regardless of the cost to taxpayers. When the union negotiates with the town council regarding wages and benefits, they are effectively negotiating with themselves. The advent and growth of public-sector unions have also brought a rise in so-called defined-benefit pension and health-care plans, both of which we need to leave behind. These have been shown to be unsustainable and will not allow us to fund the services cities require to offer a high quality of life. Finally, we need to leave behind the monuments – great sports stadiums and convention centers – which are rightfully the province of private enterprise.