Government is bad for the economy 95

A truth that should be universally acknowledged is that everything a government does it does badly. Sure, there are some things only government can do, or should do: first and foremost, if not only, defend the nation and protect individual liberty. And those are two things Obama doesn’t want to do.

Government meddling in the economy is at the very least a brake on prosperity, at worst a wrecker. (Vide Greece and Detroit.)

Thomas Sowell writes:

Since this year will mark the 50th anniversary of the “war on poverty,” we can expect many comments and commemorations of this landmark legislation in the development of the American welfare state. The actual signing of the “war on poverty” legislation took place in August 1964, so the 50th anniversary is some months away. But there have already been statements in the media and in politics proclaiming that this vast and costly array of anti-poverty programs “worked.”

Of course everything “works” by sufficiently low standards, and everything “fails” by sufficiently high standards. The real question is: What did the “war on poverty” set out to do — and how well did it do it, if at all?

Without some idea of what a person or a program is trying to do, there is no way to know whether what actually happened represented a success or a failure. When the hard facts show that a policy has failed, nothing is easier for its defenders than to make up a new set of criteria, by which it can be said to have succeeded. 

That’s what has happened with the “war on poverty.” It has failed, but the government and its hallelujah chorus will pretend otherwise.

Both President John F. Kennedy, who launched the proposal for a “war on poverty” and his successor, Lyndon B. Johnson, who guided the legislation through Congress and then signed it into law, were very explicit as to what the “war on poverty” was intended to accomplish.

Its mission was not simply to prove that spending money on the poor led to some economic benefits to the poor. Nobody ever doubted that. How could they?

What the war on poverty was intended to end was mass dependency on government. President Kennedy said, “We must find ways of returning far more of our dependent people to independence.” The same theme was repeated endlessly by President Johnson. The purpose of the “war on poverty,” he said, was to make “taxpayers out of taxeaters.” Its slogan was “Give a hand up, not a handout.” When Lyndon Johnson signed the landmark legislation into law, he declared: “The days of the dole in our country are numbered.”

Now, 50 years and trillions of dollars later, it is painfully clear that there is more dependency than ever.

Ironically, dependency on government to raise people above the poverty line had been going down for years before the “war on poverty” began. The hard facts showed that the number of people who lived below the official poverty line had been declining since 1960, and was only half of what it had been in 1950.

On the more fundamental question of dependency, the facts were even clearer. The proportion of people whose earnings put them below the poverty level – without counting government benefits – declined by about one-third from 1950 to 1965.

All this was happening before the “war on poverty” went into effect – and all these trends reversed after it went into effect.

The more the government does to “fight poverty”, the more poverty grows and spreads. Year after year, under the Obama administration, the number who “need” government assistance has increased, so that, according to the US Department of Agriculture (USDA) as reported by CNS News –

A record 20% of American households, one in five, were on food stamps in 2013 … and …  the cost of the Supplemental Nutrition Assistance Program (SNAP), was at an all-time high.

The USDA says that there were 23,052,388 households on food stamps in the average month of fiscal 2013, an increase of 722,675 from fiscal year 2012, when there were 22,329,713 households on food stamps in the average month. …

In the past five years alone, the number of households on food stamps has greatly increased. In fiscal year 2009 – Oct. 1, 2008 through Sept. 30, 2009 — the number of households on food stamps was 15,232,115. Five years later, in 2013, that amount had increased by 51.3% to reach 23,052,388 households.

It should be remembered that most of “the poor” in America are comparatively well off,  the least poor of the world’s  poor.

But if government would stop interfering, the economy would grow faster and people would have a better chance of doing well, and even becoming really (maybe gloriously) rich.

Always, figuratively speaking, the fatter the government, the thinner the people.