A Nation of Moochers

by Sykes, Charles J.

  The Bank of Our Kids

  In his comic novel Boomsday, Christopher Buckley imagines a revolt by the ripped-off young against a self-indulgent generation of boomers. The novel’s heroine, Cassandra, finds that despite her years of study and admission to Yale, she is unable to afford college because her daddy has squandered her college fund; she enlists in the army instead. Cassandra’s revenge comes a decade later when she uses her blog to foment generational revolution, complete with uprisings at golf courses where the white-haired geezers are living out their golden years at the expense of the debt-ridden members of Generation Whatever. The book’s title refers to the day when millions of baby boomers begin to make the transition from taxpayers to tax receivers, or as Cassandra puts it pithily: “Mountainous debt, a deflating economy, and 77 million people retiring. The perfect economic storm.” Ultimately her solution is, well, the ultimate solution: a system of “voluntary transitioning,” which encourages the elderly to go quietly into the good night without bankrupting the country.12 But no one is going quietly and the debt bomb isn’t going away; we are too addicted to spending our children’s money. Debt is, after all, the great enabler of spending.

  Deficit spending makes every spending decision easier because it postpones hard choices and encourages politicians to do what they do best: spend Other People’s Money without the other people figuring out that it is their money. At some level, everyone knows that there is no free money; even moochers know they are also the mooched upon. But no one wants to be a sucker, and even moochers can convince themselves they are somehow coming out ahead in the blizzard of criss-crossing dollars. Shifting the costs onto future generations is an essential part of the formula.

  Would politicians be quite so ready to spend $60,000 an hour of tax money on Air Force One photo ops or $3.9 million rearranging office furniture at the Securities and Exchange Commission headquarters if they knew they would have to give the bill to living voters?13 Would it be as easy for the government to spend $92 billion on corporate welfare, or $200 billion on lightly used and money-losing high-speed trains, if the bill was handed to taxpayers before the next election? In fact, high-speed trains are a perfect example of the allure of free money mooched from nonvoting future generations.

  The Obama administration has already made a $10 billion down payment on a flashy plan to build “high-speed” rail corridors across the nation. All told, the price tag on the plan could reach $200 billion. “What would we get for this huge investment?” asks economist Robert Samuelson. “Not much. Here’s what we wouldn’t get: any meaningful reduction in traffic congestion, greenhouse-gas emissions, air travel, or oil consumption and imports. Nada, zip.” Even though it has somehow “become fashionable to think that high-speed trains” will help save the planet, Samuelson notes: “They won’t. They’re a perfect example of wasteful spending masquerading as a respectable social cause.”14

  But across the country the argument for the trains essentially boils down to: Take the money or someone else will. States are pitted against states and cities against cities; they’re encouraged to compete with one another for a chance to spend money we don’t have on projects we don’t need. None of that would be possible without the ability to shift the cost onto future generations.

  This is true across the board.

  Between 2000 and 2010, overall federal spending grew 62 percent faster than inflation. Discretionary spending rose 79 percent faster than inflation; antipoverty spending rose 89 percent faster than inflation. Since 2000, Medicaid and food stamp rolls have exploded with costs and benefits also exceeding inflation. Under the Bush administration, federal spending increased to 20.9 percent of GDP. Even as the recession took hold, the government revved up its spending to a post-WWII record of 24.7 percent of GDP. Officials project a slight dip, but then a surge of spending to 26.5 percent of GDP by 2020.15

  The only way this is possible is to charge it to the Bank of the Kids.

  Optimists have suggested that the next generation can avoid fiscal Armageddon by simply growing the economy. But while the economy, as measured by the GDP, is estimated to grow by $34,258 per person in the next forty years, the public debt will grow by more than $250,000 per capita.16 We can’t grow ourselves out of this one.

  Where will the money have gone? We’ll have spent it on shiny new trains, on farm subsidies and television converter boxes, corporate bailouts and our retirements and health care. Think of it as the Mother of all Mooches.

  Part Six

  WHAT’S FAIR?

  An Abbreviated History of Mooching

  Late in the day a farmer is harvesting his crop, which he uses to feed his family. He takes the surplus to market to sell it to neighbors, who use it to feed their families.* The farmer uses the profits to expand his house and buy a new plow from the blacksmith, who in turn has more money for bread and even enough left over to send his daughter to school.

  Or would, if not for the moochers, whose approach has evolved over time.

  Early Moochers: Four large hairy brigands ride up and threaten the farmer with clubs unless he gives them his crops. He complies but is beaten anyway. They steal his goat.

  Feudal Moocher. The lord of the manor rides up and demands that the farmer give him 80 percent of the crop. The farmer complies and sends along his daughter for good measure.

  Modern Moochers: Four enlightened and compassionate officials drive up in an environmentally friendly vehicle.

  They greet the farmer and then explain their concern over the gap between food “haves” and “have nots.” The farmer tries to explain that he is helping to fix the problem by growing more food, which he intends to take to market to sell to the “have nots.”

  But, his visitors suggest, shouldn’t his crop be distributed on the basis of “needs” and “fairness”? The word “greed” is frequently used.

  Perhaps the farmer doesn’t realize, suggests one of his visitors, how bad this is for the self-esteem of those who do not own land; or how unfair his bountiful harvest seems for those who for a rather long list of reasons choose not to plant their land the way the farmer does. There are frequent references to children who will go hungry if the farmer keeps the crops for his own use or insists on selling it at a “profit.”

  The farmer points out that his expanding crop actually makes food cheaper and that he voluntarily sets aside a portion for the indigent, but his visitors suggest that the crop should rightfully be distributed on the basis of “justice,” rather than charity.

  Somewhat annoyed by now, the farmer asks what is “just” about taking away the crops that he has planted, tended, and now harvested?

  They assure him that they are not proposing to steal his crop, but merely to help him “spread the wealth around” a little through a “fairness” tax or fee.

  One of the visitors, apparently a tenured academic of some sort, suggests that he should hardly take credit for what is obviously brute luck. His hard work, he explains, is simply an accident of genetics and background for which he deserves no credit. Wouldn’t it therefore be more equitable to simply divide up the produce among all of the villagers?

  As evening turns into night, someone proposes they vote democratically, and after several ballots, the visitors vote themselves shares of the man’s crop. Only when they are done dividing the spoils do they notice that the farmer has disappeared.

  * In this particular tale, the farmer does not benefit from any of the agricultural subsidies described in earlier chapters.

  Chapter 18

  * * *

  WE’RE ALL FROM STARNESVILLE NOW

  * * *

  So what is fair? What do we owe one another and what right or claim do we have on our own wealth and that of others? What is the tipping point between a compassionate society and a nation of moochers?

  More to the point: What does justice demand? Leaving aside the cost, isn’t it both more just and fair for a society to spread the wealth around, to redistribute it from the “privileged”
to the “underprivileged” based on need?

  In Atlas Shrugged, Ayn Rand offers an answer in the form of a morality play of her own devising, set in a town called Starnesville, Wisconsin.1

  Rand’s story of the Twentieth Century Motor Company has a central place in the novel (spoiler alert). It marks the beginning of John Galt’s mission, while also describing in miniature what Galt stands against and why he felt compelled to stop the motor of the world. Rand tries to show the fundamental immorality behind the moral “ideal” of “from each according to his ability, to each according to his needs.” Far from being a moral ideal that lacked something of practicality, Rand insisted that a needs-based society is a truly hellacious idea, the stuff of nightmares that turns honest men into dishonest ones. In a brutal transvaluation of values, a horrible idea had somehow been elevated into a moral precept.

  The “Family”

  In the book, the owner of the Twentieth Century Motor Company dies and leaves the thriving enterprise to his three children, Eric, Gerald, and Ivy Starnes, who have very different ideas than their father on how to run the business. They call together all of the employees for a meeting at which they vote to adopt a plan that “everybody in the factory would work according to his ability, but would be paid according to his need.”2 The narrator explains the reasons for the vote: Everyone assumed that they would have the edge over someone who was better off, forgetting all of those less able than they were, who would also get unearned benefits at their expense.

  At first the whole group voted on needs. “It took us just one meeting to discover that we had become beggars—rotten, whining, sniveling beggars, all of us, because no man could claim his pay as his rightful earnings … so he had to beg in public for relief for his needs, like any lousy moocher.…”3 The competition was no longer who could work hardest, or most creatively, or most productively: “it turned into a contest among six thousand panhandlers, each claiming that his need was worse than his brother’s.”4

  The employees were introduced to the Sucker Principle: “Your honesty was like a tool left at the mercy of the next man’s dishonesty. The honest ones paid, the dishonest collected.”5

  Needs turned out to be endless, while ability became a liability. The ablest men were required to work longer hours and nights—taxed—to support the ever growing neediness of others who had figured out how the system really worked.

  A young man afire with ideas and ambition was foolish enough to come up with ideas to save thousands of man hours, but he found himself voted one of the “ablest” and “sentenced to night work.” The flow of ideas stopped: He had learned his lesson.

  As Ivy Starnes later explains: “Rewards were based on need, and penalties on ability.”6

  The Starnes

  In this morality play, the Starnes family is a triptych of villainy, with each of the siblings a different type of moocher advocacy.

  Eric Starnes craves popularity, a glad hander who is obsessed with being liked. “He wanted to be loved, it seems,” says a former worker. “We couldn’t stand him.”7

  Gerald Starnes is in it for the glory and the cash; he milks the system, surrounding himself with magazine covers touting his benevolence, which he makes as conspicuous as his own greed, “flashing diamond cuff links the size of a nickel and shaking cigar ashes all over,” while claiming that the lushness of his lifestyle was not for himself, but for the benefit of the company and its noble plan. The employees hated him.8

  But the most dangerous was Ivy, the ideological purist, who illustrates how the enforcement of “fairness” morphs into the exercise of arbitrary power. Ivy is not motivated by popularity or celebrity, but rather by “goodness,” which translates into power.

  Unlike her brothers, she didn’t care about material wealth. She dressed in “scuffed, flat-heeled shoes and shirtwaists—just to show how selfless she was.” Ivy was Director of Distribution. “She was the one who held us by the throat.”9

  The dramatic heart of the chapter is the story of an “old guy” who loved phonograph records. A childless widower, he had gone so far as to skip meals so he could afford to buy more classical music, his only real pleasure. But under the new regime, his solitary enjoyment was not considered a sufficient “need” to justify an allowance for what they deemed a “personal luxury.” At the same meeting a girl described as a “mean, ugly little eight-year-old” was voted gold braces for her buck teeth because the company psychologist worried that her self-esteen might be damaged unless her teeth were straightened. The man who loved music turned to drink and one night as he staggered down the street, he saw the girl with the gold braces and “swung his fist and knocked all her teeth out. Every one of them.”10

  Let’s cut Rand some slack and assume that she was not endorsing the music lover’s attack on the buck-toothed child; rather she used its violence to dramatize how characters were warped, distorted, and ultimately destroyed by the “plan.” Despite the unctuous good intentions, basing a society on “need” did not result in a kinder or gentler society.

  The story of the collapse of Twentieth Century Motors has one final twist: a character named Eugene Lawson, the “banker with a heart,” whose bad loans cause his bank to fail and destroy the local Wisconsin economy. His first words in the book are: “I am not ashamed of it.”11 Despite the economic devastation his actions wrought, Lawson’s self-esteem is intact and he remains convinced of his moral superiority.

  Lawson is a precursor of more modern bankers who handed out money based on “need,” rather than sound finances. His motives, he assures us, “were pure,” even though everything he touched turned to failure and ruin.12 Oddly enough, not even Ayn Rand could envision a world in which the Eugene Lawsons would be bailed out by taxpayers.

  A final irony: After crashing the bank and spreading economic devastation in his wake, Lawson ends up as a high-ranking government bureaucrat.

  Chapter 19

  * * *

  WHAT’S FAIR?

  * * *

  What is the answer to the ideologies of redistribution?

  Our answer has to start with the principle that individuals have a legitimate claim to their own incomes and that their wealth is not simply held at the sufferance of the political class.

  Robert Nozick noted that any form of compulsory income redistribution is a serious matter, as it involves “the violation of people’s rights.” For Nozick, taxation on wages was “on a par with forced labor … Seizing the results of someone’s labor is equivalent to seizing hours from him and directing him to carry on various activities.” In effect, argued Nozick, if someone forces you to do uncompensated work they become a “part-owner of you.”

  “The result,” he concluded, “is a shift from the classical liberal’s notion of self-ownership to the notion of (partial) property rights in other people.”1

  Enforcing an arbitrary standard of equality or “fairness” on society or individuals cannot be maintained “without continuous interference with people’s lives.” To maintain a pattern of “fair” distribution of wealth (however that is defined by the political elites of the moment), Nozick wrote, means that “one must either continually interfere to stop people from transferring resources as they wish to, or continually (or periodically) interfere to take from some persons resources that others for some reason chose to transfer to them.”2 In other words, people will continue to make decisions that will result in some people getting more and others less, regardless of how it affects the preferred “pattern” of income distribution.

  In a free economy, for example, people will freely give money to the man who builds the most efficient engines, or to the basketball player (Nozick famously used the example of Wilt Chamberlain, but LeBron James or Kobe Bryant would work just as well) who displays the most talent and skill. Those individual choices may result in inequalities of wealth that can only be fixed by substituting government action for the choices freely made.3

  Nozick’s alternative to the standard “from each a
ccording to his ability to each according to his needs” was “From each as they choose, to each as they are chosen [in free, voluntary, and just exchanges].”4

  What Do We Deserve?

  But do we really deserve the rewards we get? Or are we being greedy by insisting that we have a greater claim on our income than those who stake a claim to it on the basis of their “need”?

  The notion that wealth is the result of effort rather than mere luck has been under intellectual siege for decades. Whether they are conscious of it or not, many advocates of income transfers draw their inspiration not from Marx, but from John Rawls, who argued that society should maximize the position of the least well off.

  Despite his influence on modern liberal thinking, few candidates for elective office are likely to cite Rawls in their stump speeches. As William Voegeli notes, “People who call themselves Rawlsians, however, are always candidates for the faculty senate, not the US Senate.”5 But thinkers like Rawls provide the intellectual architecture for much of modern progressivism; and even if they are unseen, they are like the poets whom Percy Bysshe Shelley declared to be the “unacknowledged legislators of the world.” Behind every welfare program of the last half century there is a Rawlsian, whether he knows it or not.