07 April 2011


Kids Prefer Cheese | Mungowitz | Pelsmin: Bad That It's True, But Worse That Obama Likes It

From KPC uber-friend Pelsmin:
In Obama's statements about the dangers of a shutdown, he ranted about how the economy would be crushed if the Federal Government stopped its work. He then gave a list:

  • People couldn't sell their homes to other people.
  • Small businesses couldn't secure loans to expand
  • Companies couldn't proceed with new plants or expansion plans.

He is basically arguing that individuals can't engage in private transactions with each other unless the Federal Government is there to let it happen.

The scary thing is, he may be right.

  • FHA handles 40% of all home purchase mortgages
  • SBA and other programs make up a large proportion of small business loans
  • EPA has a choke hold on any plant expansion and "environmental impact" hurdle that must be cleared before a factory can be built.

I guess the scary thing isn't that he believes this to be the case, but that he's comfortable with the fact that it IS the case.
It is interesting: for our President, the government actually IS the economy.
Apologies for quoting the entire post, but I think this is worth seeing in its entirety.

I think it is related to — but much more nuanced and correct than — the refrain I have heard many times in the last few days and wanted to respond to. That refrain goes like this: "So what if they shut down non-essential government operations? They shouldn't be going anything non-essential anyway."

I agree with many people who have been saying that the State has expanded well beyond it's necessary and reasonable bounds, but "non-essential," for the present purposes, is not particularly congruent with "things it is 'proper' for the government to do." (However you might define 'proper.') The provision of various public goods, for instance processing of patents or maintenance of transportation infrastructure, will AFAIK, cease during a shutdown. Many things I do not want the government to be doing, like controlling interstate alcohol transportation, will continue.

I agree with the small-government sentiment here, but it is sloppily expressed. Contrary to the standard M.O. in politics, I think it is more important to be critical of your allies' arguments than your enemies.

1 comment:

  1. If having the government shut down is that dangerous to the economy, perhaps we should have less of it around.