Grassroot Perspective: Off by a Few Billion, Perils of Cronyism, and More

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Scanning the week’s national news, views and clues with you and yours in mind


By Malia Hill


Quote of the Week:
“Hell hath no fury like a bureaucrat scorned.”— Milton Friedman

Each week, we’ll be monitoring the web to find the most interesting, challenging, or important items for those who are concerned about liberty, accountability, and big government.  Here are some of the highlights from the past week:

What’s a Few Hundred Billion between Friends?

It’s not as though we never saw it coming.

Since Obamacare was just a glimmer in the President’s eye, critics have been warning that the estimates for the eventual cost of the plan were off, and that it would end up costing the taxpayers far more than its salesmen indicated.  Supporters of Obamacare attempted to divert the discussion with tricky financials or (more honestly) with the argument that the expense would be worth it.  Now, with the impact of the legal fight over the constitutionality of the plans’ various provisions and a year or so of Administrative action (or lack thereof) to take into account, the revised estimates on the cost of Obamacare are confirming what we all thought to begin with . . . that growth in the size and reach of government inevitably comes with a price hike.

As Avik Roy writes in Forbes, the Congressional Budget Office has issued three separate reports on the effect of Obamacare on taxation, spending, and budget.  Unsurprisingly, in each report, spending has gone up, as have taxes, while the amount by which the plan cuts the deficit (a heavily stressed “selling” point in the debate) has dropped substantially in the most recent calculation.  How bad is the difference?  Well, spending in the original 2010 estimate was $929 billion initial costs with a ten year cost of $944 billion.  In the 2012 report, that has gone up to $1053 billion in initial costs and a 10 year cost $1856 billion.  The ten-year calculation on tax increases has risen accordingly, from $631 billion to $1221 billion.  Tell me, if someone doubled the price of your house or car or Netflix subscription, would you just quietly accede?  (In the case of the latter, the answer is demonstrably “no.”)  Then why would we do that with the cost of Obamacare?

The Perils of Political Back-Scratching

It’s easy to see the corruption of political cronyism.  It’s not even a partisan issue, except inasmuch as each party would jump to accuse the other party of engaging in it.  I doubt there’s a voter alive who isn’t turned off by the implication that someone might use his office to benefit his friends in the private sector.  More difficult, however, is finding it where it exists and stamping out a very natural human impulse.  Would you think that having a brother on the police force might get you out of a ticket?  Or that an aunt in the county government might help you get the inside track on the next government contract?  Welcome to the world of small-scale cronyism.  It’s human nature to expect personal connections to result in tangible benefits.  But it’s in the interest of all of us to make keep the government honest and unbiased.

As David Henderson explains in his recent report on the history and economics of cronyism, not only does the practice create a system that gives a damaging level of power to certain government officials, unfairly rewarding those with more political influence, but it also fosters a damaging influence on the economy.  It discourages productivity when it results in passing costs to the public in the form of taxes and disrupts the free market by diverting money from where the public has demonstrated that it wants it to go (through the ultimate vote of spending their own money on it freely) to where the government wants it to go.  And history has demonstrated that the government is not necessarily the wisest investor.  In other words, cronyism is just one more way that the government expands its power at the price of the our wallets and liberty.

The Rush to Avoid Introspection

Isn’t it interesting how quickly the political spin that inevitably followed the Aurora tragedy became centered on gun control?  If an act of terrible violence carried out in a movie theater (of all places) can’t spark an honest discussion of the effect of violence in movies and other entertainment, then what will?

As Ralph Benko writes in Forbes, this almost frantic effort to divert attention from the possible effect of the ever-increasing scope and frequency of violence in our entertainment has a strong whiff of denial.  Not to mention a bit of “condemnation for thee but not for me.”  Neither Benko nor I endorse the idea of censoring movies (or anything else) for violence, no matter how crass or pointless.  (No, not even if it is a Michael Bay-esque assault on the senses and human intelligence.)  But to avoid any examination at all of the effect of media violence on children takes social irresponsibility to new heights, even for Hollywood.

You Still Didn’t Build that Business Yourself

Boy, those supporters of capitalism and liberty and the free market just aren’t going to drop it about the President saying that success doesn’t come from your own hard work.


It’s easy enough to see what the President thought he was saying—that we’re all connected and need to work together.  But rarely has someone more completely and unconsciously given away his own philosophical position (and hostility to business) than President Obama did in his recent campaign speech.  And that makes the exact wording he used both important and revelatory.  So let me refer you to Honolulu Magazine editor Kam Napier’s account of his own viewing of the speech (along with his own of-the-moment reactions).  That’s right; it’s time to get annoyed all over again.  Because some things are worth staying mad about.

The Meaninglessness of Economic Labels

We have a fascination with how rich the rich are, and how much they are staying that way.  We have a (more generous) interest in hoping that the poor move out of that classification.  But as Thomas Sowell explains, we have very little understanding of what either term means, whom it refers to or how it is measured.  That doesn’t, however, keep us from falling victim to ceaseless political rhetoric about class division.  But instead of a knee-jerk decision that the “rich” deserve to get soaked by taxes and that the “poor” need more government help, maybe we should delve more closely into the facts about those shifting economic labels.

Views expressed in this column are intended to promote creative thought, educate, and, we hope, prompt comment. Accordingly, thoughts expressed do not necessarily reflect the official position of Grassroot Institute of Hawaii or the author.

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