Over the past year, the idea that we're heading towards a new American civil war has moved from fringe raving to commonplace. There's a deep divide between ordinary citizens and our leaders - we see American free enterprise as a self-evidently great force for worldwide good, but our President and his party blame the world's ills on America.
Our ruling elites act as if all the world's poverty is caused by American wealth. If they can make America poor, they believe other nations will be better off. We're sending taxpayer money to Brazil for oil exploration but won't allow new drilling, new oil refineries, natural-gas wells, new oil pipelines, or oil-shale refining here. They're trying to "skyrocket" the cost of energy to take us down.
The world financial crisis laid the issues so bare that "Culture War" isn't strong enough. Our differences are much deeper than culture. Like the first American Civil War, this war is about individual rights.
The first Civil War was triggered when the South violated the American idea of a republic whose states could do things differently. Instead of letting the Northern states ignore slavery, the South went "in your face" with the Dredd Scott decision. This forced Northerners to personally participate in slavery by capturing and returning escaped slaves.
The South forced Northerners to rub their faces in what they considered an abomination, every hour of every waking day. It wasn't possible to compromise on slavery as had been done in the past because the North couldn't ignore it.
Mr. Lincoln declared that the nation couldn't survive half slave and half free. In the same way, our pending civil war is being driven by our liberal elites violating federalism and forcing all states to implement ideas such as gay "marriage" and abortion which many Americans consider to be abominations.
We're an amazingly tolerant people. We've put up with increased taxation, massive intrusion into our daily lives, and public sexual assaults by the TSA. Though gun sales jumped when Mr. Obama was elected, nobody seems to want to start flinging lead around.
Scragged was founded to argue for policies that would give our grandchildren better lives. Instead of worrying about what will happen to our grandchildren, however, the actions of the Obama administration have showed that it's coming to us.
What's changed? Mr. Obama spent more of tax money in his first six months than all US presidents before him, combined, spent. He's made our government so expensive that we can't afford it any more. We're borrowing roughly one-third of GNP each year.
When lenders stop lending and government checks start bouncing, violence will come. War is inevitable because we've bred generations of people who view public funds as their natural right. What's no longer given them peacefully, they'll attempt to take by force, and owners will resist.
The issue that's bringing us to the point of war is as simple as the slavery issue. One faction is convinced that the modern welfare state is morally superior to the more capitalist economy we had before the New Deal. This faction believes that it's not only right, it's required for the government to tax successful people to help the less fortunate.
Their opponents believe that workers have the right to keep what they earn. Earners believe that taxing productive people to support others, no matter how needy, is theft.
There's no real compromise between these views. The welfare state faction saw Obamacare as fulfilling a moral imperative - wealthy nations must provide all citizens with medical care. The "keep what you earn" faction saw Obamacare as a moral outrage, offering unlimited expensive medical care to people who cause their own health problems and requiring everyone to buy costly, "one size fits all" health insurance.
Welfare statists see forcing everyone to buy health insurance as necessary to get the money to take care of everyone, conservatives see it as government trampling individual liberty. If government can force us to buy health insurance and wear motorcycle helmets, can they force us to eat broccoli?
The "keep what you earn" faction believes in volunteer-based charity; they loathe the "social safety net" based on coerced taxation with tax money given to anyone who suffers the slightest discomfort or inconvenience.
Conservatives argue that nobody starved before the welfare state because neighborhoods and families took care of each other. They believe in individual, voluntary charity which lifts people out of poverty so they can support themselves and then look after others. Conservatives donate far more money to charities than liberals do. They measure results by the number of people who graduate out of the programs and no longer need help just as they measure school systems by the number of graduates who earn enough money to pay taxes.
Liberals measure success by the number of people who're in government programs, by the amount of money spent, and of course by recipients voting for liberal politicians. If the "social safety net" locks generation after welfare generation into poverty, so be it, particularly if they vote for more goodies at election time. Conservatives see multi-generation welfare ghettos as an abuse of the human spirit which verges on deliberate evil.
We now know how the culture wars will play out - no economy can afford the welfare state. It simply isn't sustainable. Europe and America have been running on borrowed money for two generations. The money's running out, so things will change even in the home of European socialism.
The slow-moving Greek bankruptcy is a battle between ordinary Europeans and the European ruling elite. When running for President, Mr. Obama illustrated what it means to be in the elite when he referred to himself as a "fellow citizen of the world."
Elites think of themselves as enlightened beings who benefit the world at large instead of individual nations. They get together to swap ideas how best to rule us - for our own good, of course.
Greece should default, cancel debts, and go back to their own currency. Not having to pay off massive debts would make it easier to return to prosperity. Personal bankruptcy wipes out debt because when there's no way to pay, there's no point trying.
Most Greek debt is held by European national banks. Stiffing French and German banks would upset the European elites because their taxpayers would have to pay. Greek rulers don't want non-Greek elites mad at them, so they accepted a plan to increase the amount Greece will have to pay back. The way to cure Greek debt is to pile on more?
The new bailout may postpone default but will make default worse when it arrives. That's OK with Greek politicians because they'll keep their elite status in the meantime.
Greek citizens are rioting. They don't want to give up anything they're getting and they don't see why they should be taxed any more. France and Germany paid for the first bailout, but their taxpayers see no reason to pour money into Greece and plan to punish their rulers in the next election.
Why didn't the Germans or the French cut the Greeks off? Governing elites don't see themselves as French, German, or whatever, except when electioneering the rubes. The rest of the time, they're Europeans or "citizens of the world."
They salute the "Pan-European" dream where there are no national boundaries just as our elites don't believe in national boundaries. They can't let themselves help their citizens by stopping the Greek gravy train - it would hurt the Greek elites who are their friends. Greek rulers won't help Greek citizens by defaulting - that would hurt their European friends and tarnish the pan-European ideal the elites all hold so dear.
The American welfare state started with the "New Deal" during the Depression. Our expectations of government changed profoundly over FDR's decade-plus in office.
As Newsweek put it in 1993, “We gradually moved from an era in which people did not want to use government for anything to today when people use government for almost everything.” The Daily Telegraph explained how Britain followed the same road:
The welfare state, as conceived by the great social reformer Sir William Beveridge and implemented by the Attlee government after the Second World War, was a sublime idea. It rescued millions of British citizens from the degradation of poverty and lifted the fear of illness. It guaranteed employment or, if jobs were not available, universal benefits. It offered security in old age.
Welfare advocates assumed that even though penalties for idleness and failure were removed, people would work as hard, be as responsible, and look after their families just as well as when survival depended on their own efforts. They assumed that the welfare system would not reduce individual work incentives so tax revenue would not fall and welfare costs would remain small.
Others argued that welfare would tempt people to be idle, but they lost the debate to the "welfare state" faction. Unfortunately, human nature didn't change - work and responsibility have became less common because they're no longer required for survival.
In 1980, T. E. Utley, chief political commentator for the Daily Telegraph, identified the problem:
"Roughly speaking, social democracy may be defined as an arrangement under which we all largely cease to be responsible for our own behaviour and in return become responsible for everyone else’s. The temptations which this way of doing things offers to synthetic anger, fraudulent penitence, all other forms of hypocrisy and the sheer evasion of duty are infinitely too strong for fallen man." [emphasis added]
Once welfare became available, people no longer had to fulfill traditional duties. Working women didn't have to raise children to care for them in their old age because government promised to care for them. Not having children is also a good way to avoid trouble with the child protection bureaucrats.
A few years ago, the Daily Mail covered a family whose grandparents were solid working people but whose current generation lives off the government. Karen Matthews, a central figure in the story, had never had regular work yet received £400 a week benefits, having had seven children by five different men.
Ms. Matthews doesn't need a husband; welfare provides her every need, and the more children she has, the more money she gets. In America, many welfare recipients have bigger families than American taxpayers.
Unlike welfare recipients, unionized government employees perform work, some of it useful and necessary, but they use their collective power to hold taxpayers to ransom. Union bosses invest their forcibly-extracted union dues to help elect politicians with whom they "negotiate" salary and benefits.
Our elites have allowed union contracts which make it nearly impossible to fire anyone and they've promised benefits which are bankrupting us. The unions control both sides of the negotiating table; the taxpayer who's stuck with the bill is nowhere to be seen.
Private sector unions are no better. General Motors was once the most profitable business in the world. Even at its peak, it couldn't earn enough to pay the health and pension benefits it had promised the United Auto Workers. Without going through bankruptcy which wiped out its debt and receiving a massive bailout with taxpayer money, GM would have disappeared.
Without bankruptcy to wipe out debt, there's no way Greece, Portugal, or the rest can be solvent. Even in the face of such realities, unionized employees won't accept pay cuts, pension cuts, or even work harder.
No government makes it easy to figure out just how much they've promised and they lie to make it easier to sell debt. USA Today reported that our government is going the way of Greece: unfunded obligations in the US are now at $528,000 per household.
In 2010, our government increased the amount we owe by one third of our GNP. Our "welfare state" elites have sold us down the river to the tune of more than a half million dollars per household. No matter how high taxes get, that's far, far more than we can ever repay.
Free enterprise generated the wealth that made our welfare state possible. As excessive taxes and onerous regulations have moved us further and further from a free market, the most powerful economy history has ever known is staggering under the load of parasites and barnacles. Mr. Obama claims to understand this:
No business wants to invest in a place where the government skims 20 percent off the top, or the head of the port authority is corrupt. No person wants to live in a society where the rule of law gives way to the rule of brutality and bribery. That is not democracy, that is tyranny, and now is the time for it to end.
- President Barack Hussein Obama, on the need for reform in Africa, New York Times quote of the day, July 12, 2009
Mr. Obama learned corruption in Chicago - his administration merrily gives Obamacare waivers to favored groups in return for political support and he's imitated the Greeks in creating job-killing regulations. The Wall Street Journal recently reported that one out of every three dollars earned in the U.S. goes to pay taxes or to comply with federal laws and regulations.
Nobody invests where 20% is taken off the top, and we're worse than that; 35% of our national income covers nothing but regulations. Without massive job creation, we can't pay our current debts even if we don't borrow any more. Our government has made it too expensive to create new jobs so we're stagnating.
In 2011, Americans received more money from government than they paid in taxes. Our nation is half self-supporting responsible citizens and half who live off government. As America couldn't survive half slave and half free, the productive half of our society can't support so many people who consume more tax money than they produce.
Regardless of the morality of the welfare state versus individual responsibility, no economy can support a welfare state because too many people stop working. Working taxpayers can't support both the welfare state and unionized government employees; welfare states last only as long as lenders pick up the bills.
When German and French taxpayers get sick of supporting Greek consumers, their rulers will cut the Greeks off to save their skins. When the Chinese get tired of supporting Americans who consume more than they produce, we'll be cut off.
Margaret Thatcher warned, "The trouble with socialism is that eventually you run out of other people's money." Welfare states run on borrowed money. When nobody lends, it all comes crashing down.
Some of the European elites understand this. David Cameron, Prime Minister of England, has declared that British society is "broken," and offered the "big society" in its place. Instead of having services paid for by the government, he wants to recruit volunteers - individuals who look out for each other as in the past. The Guardian quotes Mr. Cameron:
"I don't think this has happened because we've somehow become bad people. I think at its core, it's the consequence of years and years of big government. As the state got bigger and more powerful, it took away from people more and more things that they should and could be doing for themselves."
Mr. Cameron has noticed that when government does anything for people, bureaucracies spend vastly more than reasonable people would spend. What does it costs for an elderly parent to be helped in a relative's home versus being put in a nursing home at $30,000-$50,000 per year?
The British aren't bad people any more than Americans are, but our problem is the same: they, and we, have succumbed to the temptation to lie back and let government take care of us.
... [the liberal elite] is wrong in its immediate assumption that it is the state’s job to look after our parents when they get decrepit. In fact, the one thing we know for certain about the state, from the terrible recent Panorama exposé and other reports, is that it does this job very badly indeed. [emphasis added]
The first decade of the new millennium has demonstrated that there were actually two wrong assumptions behind the founding of the welfare system, only one of which was foreseen.
The first assumption, that people would continue to work hard even if the government took care of them, was expected to be wrong by conservatives. The second wrong assumption wasn't really understood by anyone; even people who thought that government shouldn't try to take care of everyone thought it could.
Over the past 50 years, we’ve seen a number of gigantic policies produce disappointing results — policies to reduce poverty, homelessness, dropout rates, single-parenting and drug addiction. Many of these policies failed because they were based on an overly simplistic view of human nature. They assumed that people responded in straightforward ways to incentives. Often, they assumed that money could cure behavior problems. [emphasis added]
David Cameron is trying to reawaken the British sense of responsibility. Back in the days of the "stiff upper lip," one could say, "There'll always be an England." To his credit, Mr. Cameron has recognized that without individual responsibility, without major changes in behavior, there's no way the British can afford to be England any more.
We wish Mr. Cameron well in his efforts to turn England around. If he can, well and good.
If he and the rest of Europe can't, though, the entire European economy will collapse into the Confucian abyss of economic and governmental collapse, chaos and anarchy. Eventually a strongman who'll bring order but destroy freedom. If that happens, those who can't take care of themselves will starve because the government will be unable to care for them any more.
The welfare state cannot go on. Not merely because it shouldn't, not only because it crushes the human soul and destroys the last vestige of freedom, but because no country anywhere - not America, not Britain, not Greece, not any nation - can afford it. We'll either avoid disaster by cutting spending the hard way regardless of screaming, or we'll cut spending the very hard way by total collapse.
We call spending cuts the hard way because nobody wants to give up a dime of benefits. Wisconsin teachers lied about being sick and rioted against budget cuts. Connecticut unions refused to accept a freeze which didn't cut pay at all. Minnesota state government shut down because the politicians can't agree on a budget - one side wants to cut spending, the other wants to raise taxes. European elites are criticizing the rating agencies for downgrading European debt - they'd rather shoot the messenger than cure the problem. Cutting costs enough to avoid collapse is a hard way indeed.
Personally, we'd prefer the hard way to the very hard way, but our politicians, government employees, and other leeches want to spin things out as long as they can.
The longer they wait, the longer they try to keep the welfare state going, the messier the crash will be when it hits the wall and stops.