[Benjamin Lusty is a lawyer and an occasional contributor to Publius Online]
Democrats love talking about roads when they are actually talking about something else. Listen to Massachusetts senate candidate (and progressive heart-throb) Elizabeth Warren: “There is nobody in this country who got rich on his own. Nobody. You built a factory out there—good for you! But I want to be clear. You moved your goods to market on the roads the rest of us paid for.” Hear this echo from President Obama: “If you were successful, somebody along the line gave you some help.… Somebody invested in roads and bridges. If you’ve got a business—you didn’t build that. Somebody else made that happen.”
The uninitiated may think that Democrats are actually talking about roads, which only they support, and without which we’re relegated to the anarchic Republican blood sport of “you’re on your own” economics. Democrats, in their humble public spiritedness, plead for just a few more tax dollars, taken from just a few more rich people, to build just a few more miles of road so we can all share in the wealth they mysteriously generate. Conservatives, they insinuate, cosset capitalist barbarians who loot our collective infrastructure.
This is obfuscation. Democrats aren’t talking about roads. They’re talking about entitlements and the taxes to fund them. President Obama’s reelection wouldn’t herald a new age of aqueducts, Great Walls, and Hoover Dams. It will aggrandize the welfare state. Democrats retain power by distributing cash to special interests within their electoral coalition. Seniors get social security and Medicare, college students get subsidized loans and Pell grants, and civil servants enjoy “Ferrari” health plans and gilded pensions. In exchange, they vote Democrat. It is simple entitlement politics. Democrats’ political survival depends upon funding it all without asking sacrifices of their supporters. Although road building grabs some votes, entitlements grab more.
Math, however, gets in the way. Protracted recession and escalation of federal spending threaten both the treasury and Democrats’ electoral prospects. This in turn necessitates a prolonged campaign to raise taxes to sustain current benefit spending. But rather than honestly call for higher taxes, Democrats dress their politico-fiscal paradigm in the camouflage of “public investments” while simultaneously accusing conservatives of anti-social thuggery. Raising taxes to pay for somebody else’s health care is a hard sale, particularly when higher taxes hurt the families that pay. It is far easier to eulogize roads and hope that most people believe that’s the actual subject of the ploy.
Consequently, Democrats deliberately misuse the concept of public goods as a campaign strategy. Public goods are simply those things that everybody can enjoy equally. One person’s use of a road or a park does not necessarily limit access to the benefit it generates. Similarly, everybody enjoys national defense, fire protection, and policing. Government funding of public goods makes economic sense because private markets generally do not provide sufficient incentive for investment.
The same is not true, however, of entitlements which are only privately enjoyed. One person’s Medicaid benefits cannot be consumed by another, even though the costs are shared by all taxpayers. Further, entitlements do not lead to the creation of new goods. Entitlement spending simply funds private consumption of things which the private market already creates.
Although the interstate freeway system may not exist without the Department of Transportation, Pennsylvania Hospital (the nation’s oldest) existed long before Medicaid selectively distributed health care benefits. Unlike public goods, entitlements do not contribute to social wealth; instead they shift consumption from one group to another.
Democrats’ political survival, however, depends on their ability to convince voters that private consumption of public funds is actually a positive good to the rest of society that justifies elevated taxation. This is only rhetorically possible if Democrats convince others that their spending program is simply nothing more than making everybody chip in their “fair share.” The rhetoric used, however, is inherently deceptive and fails to convey honest information about the fundamentally differing economic qualities of public goods and entitlements.
Ironically, Democrats’ confusion of public goods and entitlements jeopardizes the ongoing vitality of public goods far more than any perfidy which they attribute to Republicans. Entitlement funding dwarfs all other expenses and engrosses an escalating share of public revenue. Absent comprehensive reform, entitlement politics will bankrupt the state, stalling every core public function upon which Americans rely. Democrats are travelling a rhetorical public road to nowhere on the racecar of unreformed entitlements.
- Obama’s “You Didn’t Do It On Your Own” Logic (justinhohn.typepad.com)
- Richard (RJ) Eskow: The “Fiscal Cliff”? A Hoax. The Democrats’ “Long Game”? A Myth. This Is the Real Budget Battle (huffingtonpost.com)
- Paying for it (economist.com)
- Alliance for a Better Utah or Alliance for a Democratic Utah? Donors, please? (publiusonline.com)
- Making The Rich “Give Something Back” Isn’t A Budget Plan (redalertpolitics.com)
- “Obamacare” & the Public Good (counterpunch.org)
- “The Decline of the Public Good” (economistsview.typepad.com)