Challenge to telerion, palynka, kazetnagora, sh76

I would challenege you four for your often apologist positions on government and politics involvement in the economy, feel free to disagree with the premise.

My position is that there are only a limited number of ways that government with any reliability tends to not spend enough and that is usually on very specific things (i.e. investments in education and incentives for intellecutal property innovations), whereas most governments of the world would do well to move much of their spending towards a more libertarian, non-interfearing direction and simply spend less, for example on generous public employee benefits like pensions.

Reduced government red tape and political spending would go a good way towards freeing up resources for the taxpayers and maintain the incentives to earn income.

However, there is a problem in which politicians tend to spend more during their limited term in office, and they tend to give out more goodies in spending than they collect through taxation, causes many distortions in their country's markets.

Hence the pension reforms even in ever-popular Scandinavian socialist societies.

Perhaps we all agree on the economic benefits of this move away from government involvement and at least a partial movement towards libertarianism.

Actually, though I chose the crowd for generally intelligent debating, I fully expect one of you to rely more on name calling and most of you to at least largely disagree.

I do think others out there will agree with my position more than disagree, even some of you, but I have heard many insults even from you four thrown out randomly against libertarian-leaning people who criticize the large and usually growing government presence in the economy, so if any of you care to support such positions, let's debate.

Originally posted by eljefejesus
My position is that there are only a limited number of ways that government with any reliability tends to not spend enough and that is usually on very specific things (i.e. investments in education and incentives for intellecutal property innovations), whereas most governments of the world would do well to move much of their spending towards a more liber rnment presence in the economy, so if any of you care to support such positions, let's debate.

I think it boils down to democracy. If the case is made that lower government spending and less regulation etc. etc. leads to higher prosperity and a higher quality of life, more equitably shared, and in a way that is sustainable, then citizenries around the world are, of course, going to install advocates of the more libertarian-leaning recipe. What these advocates need to do is provide some examples: solid indications that prosperity and quality of life are inferior in, say, Scandanavia, than they are in whatever libertarian-leaning economies are cited. You successfully do this and democracy will do the rest.

Originally posted by eljefejesus
Reduced government red tape and political spending would go a good way towards freeing up resources for the taxpayers and maintain the incentives to earn income.

I would like to challenge this particular point.
Does anyone here agree with the claim that higher taxes reduce the incentive to earn income? I personally find it hard to believe. I have lived in two countries, one with much higher taxes than the other, but have not noticed much change in my incentive to earn income. Higher taxes do tend to provide incentive to dodge taxes.

Originally posted by twhitehead
I would like to challenge this particular point.
Does anyone here agree with the claim that higher taxes reduce the incentive to earn income?

I think it is two things: (a) a long standing urban myth, and, rather revealingly (b) a central tenet of neo-liberal ideology. It goes hand in hand with the exquisite dichotomy: you pay the poor too much, they lose their incentive to work; you don't pay the rich enough, they lose their incentive to work. 😉

I think the main point libertarians don't (or refuse to) understand is that there are some things which the free market simply cannot provide. There is no way a free market can provide police coverage, for example, except for a system of mandatory insurance with some kind of "security firm" (but then, what is the difference with taxation for a national police force?). Additionally, some services are more efficient if monopolized - can you imagine several national armies? Likewise, energy supply and infrastructure maintenance and construction are more efficient if monopolized - just look at the disaster that the privitization of UK railways has been or the Enron fiasco. Furthermore, there is game theory which can point to government intervention in some cases such as education and health care - you would do well to read up on the prisoner's dilemma.

Originally posted by eljefejesus
I would challenege you four for your often apologist positions on government and politics involvement in the economy, feel free to disagree with the premise.

My position is that there are only a limited number of ways that government with any reliability tends to not spend enough and that is usually on very specific things (i.e. investments in educati ...[text shortened]... rnment presence in the economy, so if any of you care to support such positions, let's debate.

I think the main criticism with most libertarians that I have, is that they usually are inconsistent in their arguments. I also disagree with some of their predictions (regarding efficiency), but this is something that can only be answered empirically and, in my view, can only be determined case by case. So let's start by discussing consistency.

Let me try to explain in a (very!) succinct way:

This inconsistency comes simply from arguing against a given government intervention (say, healthcare reform) by attacking government interventions in general while admitting certain exceptions. From the moment you admit exceptions, you tacitly agree that there are cases where the maxim "government intervention=bad, private sector = good" does not apply. If you admit exceptions, and there might be good reasons to admit them, then to argue against a given reform/intervention you need to articulate why you think this is not an exception. Blanket arguments regarding total government spending or red tape are then not enough. The corollary of this is that general discussions about total government size are also on shaky ground. It's not about size, but what is superfluous and what is not.

Of course, I freely admit that red tape and government spending are real and important costs. No argument there. But the real question is not if these costs are present, but if they are serving a purpose that outweighs them or not.

Originally posted by twhitehead
I would like to challenge this particular point.
Does anyone here agree with the claim that higher taxes reduce the incentive to earn income? I personally find it hard to believe. I have lived in two countries, one with much higher taxes than the other, but have not noticed much change in my incentive to earn income. Higher taxes do tend to provide incentive to dodge taxes.

I think that that it does affect the incentives to start a private business or not. Anyone looking at a business plan will immediately realize that taxes affect payback periods, etc.

However, I also think that the effect in terms of incentives for wage-earners is not that large. People do respond more to relative than absolute wage differences. Say, you might work harder if somebody offers you a higher paying job but you might not work harder if taxes are cut.

Originally posted by Palynka
I think that that it does affect the incentives to start a private business or not. Anyone looking at a business plan will immediately realize that taxes affect payback periods, etc.

However, I also think that the effect in terms of incentives for wage-earners is not that large. People do respond more to relative than absolute wage differences. Say, you m ...[text shortened]... arder if somebody offers you a higher paying job but you might not work harder if taxes are cut.

Yeah, it's mostly the relative differences which determine how "rich" a person feels; a middle class worker is very rich compared to the average white collar worker 100 years ago, but still feels like having an average income.

I hope some of you are going to do a rather better job of communicating your ideas and opinions than this incessant use of the word "red tape" would seem to indicate. "Red tape" means nothing, everything and anything. People who use it can be referring to whatever they want. It has been rinsed of all meaning. It is so often brandished pejoratively to smear, trivialize or disguise important measures, safeguards and mechainisms of deliberation which are vital components of a functioning democracy. Using the term "red tape" is lazy, obfuscating, disingenuous. It is the vocabulary of shallow posturing. Everybody who has used it so far in this thread is capable of doing better than this.

Originally posted by FMF
Everybody who has used it so far in this thread is capable of doing better than this.

I did say that red tape can serve a purpose. I use it interchangeably with bureaucracy or paperwork, which also have negative connotations.

Originally posted by Palynka
I did say that red tape can serve a purpose.

What purpose can it serve if the definitions of it that various contributors bring to the discussion are different ?

Obtaining documentation from an Environment Ministry certifying that a commercial project will have an acceptably low negative impact on bio-diversity in its area of operation - is it paperwork and bureaucracy, so called "red tape", replete with the 'negative connotations' of the terminology? Or is it an essential protection of the long term interests of local people, a wise political safeguard that is prone to being casually dismissed by calling it "red tape"?

Originally posted by eljefejesus
I would challenege you four for your often apologist positions on government and politics involvement in the economy, feel free to disagree with the premise.

My position is that there are only a limited number of ways that government with any reliability tends to not spend enough and that is usually on very specific things (i.e. investments in educati rnment presence in the economy, so if any of you care to support such positions, let's debate.

the focus here appears to be on two things

1. the need for much more fiscal discipline - to get the deficits and debt under control
2. the large amounts the WFA (waster-fraud-abuse) that always seem to infect any system of government.

But general efforts to just "make government smaller" or "cut taxes" don't really address these problems, and they might actually make the problems worse.

One big problem over the past couple decades has been an inordinate opposition to any kind of a tax increase. But this actually leads to bigger government. To avoid raising taxes, the politicians borrow the money instead -- which means that the government ends up spending a lot more money for the same amount of stuff over the next 10-20 years.

Originally posted by eljefejesus
I would challenege you four for your often apologist positions on government and politics involvement in the economy, feel free to disagree with the premise.

My position is that there are only a limited number of ways that government with any reliability tends to not spend enough and that is usually on very specific things (i.e. investments in educati rnment presence in the economy, so if any of you care to support such positions, let's debate.

I agree with the libertarians' mission in that there should always be an ongoing effort to find ways of governing in ways that are less costly and less intrusive. But I disagree with them when they start claiming that government is evil in of itself.

I see a parallel with someone running a business (in an industry with lots of competition). They are always (or should always) be looking for ways to cut costs and improve efficiencies. But no business owner thinks that the business he/she is running is inherently evil. And none of these owners make it their goal to make their business "small enough to drown in their bathtub". But these owners do care about the quality of their product or service, and they do care about their customers. They have to avoid running budget deficits (just to stay in business) - and they will want to get rid of as much WFA as possible - and they are often eager to cut prices to remain competitive.

Originally posted by eljefejesus
I would challenege you four for your often apologist positions on government and politics involvement in the economy, feel free to disagree with the premise.

My position is that there are only a limited number of ways that government with any reliability tends to not spend enough and that is usually on very specific things (i.e. investments in educati rnment presence in the economy, so if any of you care to support such positions, let's debate.

Okay, fair enough. Let's go. 🙂

My position is that there are only a limited number of ways that government with any reliability tends to not spend enough and that is usually on very specific things (i.e. investments in education and incentives for intellecutal property innovations), whereas most governments of the world would do well to move much of their spending towards a more libertarian, non-interfearing direction and simply spend less, for example on generous public employee benefits like pensions.

Out of the 4 people listed in the title, I'm probably the most libertarian-leaning. I think the concept of libertarianism has merit and I believe in freedom of the individual rather than of the collective.

That having been said, I think history has shown that the market is not capable of policing itself completely. Anti-trust laws, for example, are, I believe, necessary to avoid competition-stifling monopolies and harmful collusion. An unregulated health insurance system leads to enormous waste based on the fact that the consumer pretty much needs the service and is at the mercy of the limited market for the specific services that he needs to stay healthy. I also think that government has a moral responsibility to help its poorest citizens maintain at least some level of human dignity, though I would like to see more of a workfare (i.e., if you can work, then work for your welfare) way of doing it.


Reduced government red tape and political spending would go a good way towards freeing up resources for the taxpayers and maintain the incentives to earn income.

Reduced from what, though? The mantra of "cut taxes" "cut taxes" only goes so far. How far do you cut them? To zero? I look at individual government programs and expenditures and judge them based on their own merits, not based on an overarching philosophy. I do agree, though, that fundamentally, governments should do their utmost to promote free market competition.

Some things, though, must be government funded or they will not exist. Nobody would have privately financed NASA and the space program. And though you may not think it any big loss if we never made it to the Moon, many useful technologies were developed by the space program. I'm in the middle of reading the great Herman Wouk's "A Hole in Texas" about the Superconducting Super Collider project and its struggle to achieve and maintain government funding. Without government funding, these types of projects, including CERN (which helped bring us the World Wide Web) would never exist. It is for these types of projects that governments need to step in and provide public financing. Also, as KN said, of course, things like police, firefighters, education and the military, need to be publicly funded to adequately serve the public.

However, there is a problem in which politicians tend to spend more during their limited term in office, and they tend to give out more goodies in spending than they collect through taxation, causes many distortions in their country's markets.

That, I agree with 100%. That's why I'd favor a Constitutional Amendment requiring a balanced budget except in cases of national emergency and require a 2/3 majority of Congress to pass an unbalanced budget even in an emergency cases. The tendency of politicians to overspend to make their constituents happy just to save their jobs and to not worry about the future, is a major problem.

Hence the pension reforms even in ever-popular Scandinavian socialist societies.

I don't have any problem with privatizing government pension plans such as social security. But I'd be reluctant to scrap those problems all together. If people aren't forced to save, many won't. The government will end up having to support these people anyway through welfare programs when they're too old to work. They might as well be supported by their own savings.

Perhaps we all agree on the economic benefits of this move away from government involvement and at least a partial movement towards libertarianism.

I think we can all agree (or most of us, anyway) that there needs to be a balance between them.

Actually, though I chose the crowd for generally intelligent debating, I fully expect one of you to rely more on name calling and most of you to at least largely disagree.

I do think others out there will agree with my position more than disagree, even some of you, but I have heard many insults even from you four thrown out randomly against libertarian-leaning people who criticize the large and usually growing government presence in the economy, so if any of you care to support such positions, let's debate.

I'm not sure that the pre-emptive defensiveness was entirely necessary, but I can understand why you felt it necessary. 😉

Originally posted by FMF
I think it is two things: (a) a long standing urban myth, and, rather revealingly (b) a central tenet of neo-liberal ideology. It goes hand in hand with the exquisite dichotomy: you pay the poor too much, they lose their incentive to work; you don't pay the rich enough, they lose their incentive to work. 😉

I'm not sure if I buy the argument that taxing the rich decreases their incentive to work, but I KNOW that I do buy the argument that paying the poor too much with no strings attached decreases their incentive to work.

I have dozens of clients that have told me that going to work doesn't pay for them. Just yesterday, a client told me that he's on Medicaid (for his whole family), Section 8 Housing Assistance and WIC (a food stamp type program). He estimates that his government benefits are worth at least $40,000 per year. He makes sure that he earns less than the income threshholds for these programs and maybe he and his wife do some "off the books" work around the neighborhood for spending money. But he absolutely could not afford to take a full time job that would pay him market wage based on his (limited) skill set.