Tuesday, June 15, 2010
fiscal therapy
President Obama is asking Congress to spend another $50 billion (which will come from all of us) to bail out certain state governments that have acted irresponsibly. I don’t think that these states are even going to be asked to undergo any “fiscal therapy” of restraints being placed on their behavior like the banks and Greece were. Ask someone who supports this plan the following question: “How will you convince those states that have lived within their means that they should continue to act responsibly?” Or “How will you convince those states that have had others pay for their extravagance that they should start to act responsibly?” The answer will very likely be some form of: “Somehow.” That is a response that will be recognized by the readers of Ayn Rand novels.
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A few months ago a colleague and I had this discussion concerning weather the US should bail out California. When I asked how we would get California to change its ways he did not reply "somehow". He replied, with a straight face, "why". In his mind California's fiscal crisis was not caused by California's actions. A diatribe attacking free enterprise, and the need for more regulations followed. He also mentioned how irresponsible it is for industry to leave California because taxes are too high.(see stasis fallacy)
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