The Quandry

Much has been discussed over the last few months about the proposals of the Obama administration in regards to health care. Both would expand the power and authority of the federal government to heretofore unseen dimensions. Conservatives (both Republican and Democrat) are not enthused about this considering these measures to be a threat to Federalism, the private sector and individual liberty in general. Liberals (especially on talk radio and "The View") are enraged by what they call obstructionism from the right.
But this is all very simple people. Let me demonstrate by analogy. Let's say that my wife is pregnant and needs an abortion to save her life. Or let's say I have a teenage son who has such a bad case of pneumonia that if he doesn't get medical care from a hospital, he will die. Do I have the right to go to my well off neighbor and, at gun point, raid his bank account and confiscate his capital gains earnings to force him to pay for treatment of these legitimate medical issues? Do I have the right to hire someone else to do so? Do I have the right to get my Senator to do it? Theft is theft whether it be with a gun are a government program. Such class warfare is never good. In every society, class warfare left unchecked has only resulted in societal masochism with terrifying results. And it always starts small with legitimate issues like social justice and the "Robin Hood complex" that the federal government seems to be afflicted with these days.
In sum, it is, I believe, Henry Weaver who said it best. "Most of the major ills of the world have been caused by well-meaning people who ignored the principle of individual freedom, except as applied to themselves, and who were obsessed with fanatical zeal to improve the lot of mankind-in-the-mass through some pet formula of their own….The harm done by ordinary criminals, murderers, gangsters, and thieves is negligible in comparison with the agony inflicted upon human beings by the professional 'do-gooders', who attempt to set themselves up as gods on earth and who would ruthlessly force their views on all others – with the abiding assurance that the end justifies the means."

And Madame la Guillotine awaits.

The Economy

The year was 1992; George H.W Bush was running for reelection. I had just turned 18 and was entering my last year of High School. I was also paying more attention to politics and had decided to register as a Democrat. During the Democratic Party primaries I had rooted for the now late Paul Tsongas and was a little disappointed when Governor of Arkansas Bill Clinton got the party nod. To be honest I didn’t really know a lot about Paul Tsongas’ platforms. What I do remember was a commercial of his that I had seen where he was swimming. The commercial promised that if elected Paul Tsongas would immediately call an economic summit to deal with the then economic recession. This appealed to me. I figured that something needed to be done about the economy. And I was impressed that somewhat in government had come out and offered to really look at the problem and address the issues. I was disappointed when he lost the Primaries. I got over it though when I heard Bill Clinton speak. Say what you will about him, he is a good orator. I once heard him speak where he quoted scripture. That too impressed me. He quoted part of Proverbs 29:18, “Where there is no vision, the people perish.” I don’t remember anything else he said, I just remember getting a good feeling when he spoke.

Looking back though, I fully realize that I knew nothing when it came to the economy in general and the Democratic platform in particular. I think that I was a Democrat only because my parents were Republican. I was excited to get to vote but, admittedly, I did not know what I was voting for. Eventually, I could not make up my mind because I just did not understand. So I went with the “safe” vote. I voted for Bush. That’s right, as a Democrat, I voted for Bush. I didn’t know why I was voting for him at all. But I knew that if I had voted Democrat, My father would have asked me why. I would not have been able to answer, so I avoided the issue and voted for Bush.

My father remains (warts and all) one of the smartest men I know. Politically, he could be a little intimidating but only because he asked good questions and if you did not have good answers, you looked stupid. This was driven home one evening that same year when we had a discussion about minimum wage. I, being a teenager who earned minimum wage, was all for the government raising it. My father was against it. He had been a small business owner who had burned out and sold his business. He understood well the consequences of government intervention into the economy. He understood the effects on business owners that raising the minimum wage would have. He explained how such government intervention might hurt the very people (especially me) that the government thought they were helping. He explained it from a small business point of view. He said that small businesses don’t often have a whole lot of money to throw around. If they have to choose between paying so much for taxes (or go to jail for tax evasion) and pay a government-mandated minimum wage hike for employees (the number of which you can control) guess which one you are not going to pay? A primary effect may be that workers looking for jobs are hurt because employers simply cannot hire them, they cannot afford too. A secondary effect is that small businesses cannot hire needed help to handle the workload of running a business, which causes more stress for the business owner.

My father had a really hard time explaining this to an 18-year old kid who made minimum wage and didn’t understand a thing about economic cause and effect. This was not his fault. It was mine. It was and is my responsibility to do the research and understand these things.

Unemployment in France

When one looks at any aspect of society in France, one sentiment immediately rises to the surface, France will be France. The French just do things differently. And the issue of its chronically high unemployment rates is a case in point. The issue is not rooted in the whims of the French national and world markets or the political realities of the moment. It is, instead, rooted in French culture itself.

With the French Revolution, France, following the lead of the United States, became a pioneer of democracy. However, in that time the political structure has never been stable for very long. Indeed, since the French Revolution of 1789, France has had five republics with 15 constitutions. (Maqstadt 128) That being said, from Robespierre to Napoleon to Charles De Gaulle, the French have never left behind, at least never for very long, the public reliance on a strong central executive authority in a government that would constantly intervene and play a big part in the economy. The French call this dirigisme and despite brief departures from this tradition, it continues to this day in varying degrees throughout the French economy. (Maqstadt, pg.137, The Economist 2009) So much so “that the French idea of ‘national solidarity’ is tied to this dirigiste policy.” (MacArthur, 2006). The result is a large welfare capitalist state funded by high tax revenues and heavy social-security contributions making the public very dependent on the government in their daily lives.

An unfortunate side effect to this is the issue of French labor and chronically high unemployment figures. Indeed, over the years France has been plagued with high persistent unemployment to such a degree that the percentage of unemployment rarely dips below 8% even in good times (The Economist, 2009) In light of the current economic outlook, the numbers look even more troubling despite attempts to say otherwise (The Economist 2009). In the first quarter of 2009, 187, 800 jobs were lost. And this was after a troublesome year in 2008 where 30, 600 jobs were lost in the fourth quarter and 14, 500 in the third quarter. Young workers have been particularly hit hard with unemployment for workers under 25 at 21%. In heavily Muslim communities the rate is double that.

Plus, over the long term, these high unemployment rates are taking their toll on the economy. Over the 20 years, the number of jobs in industry has dropped by about ¼ %, going from 4.6 million to 3.5 million. (Barroux & Rey-Lefevre, 2009)

Further, the usual government method of taxing employers and employees with such heavy social-security contributions deters firms from creating jobs. This makes the funding of the welfare capitalist state increasingly difficult if not impossible as the demands of their much touted health care system, unemployment benefits and other public services increase draining the coffers and tax and contribution revenues needed to refill the coffers increasingly decrease.

In sum, the French government has two choices, cut benefits in the welfare state or raise taxes even higher for those who are still working. Both solutions are unwanted by French voters. But the French cannot have it both ways.

Sources:

1. Magstadt, Thomas M. Nations and Governments. Belmont: Thomson/Wadsworth, 2003

2. MacArthur, John R. “In Defense of French Dirigisme.” Harper’s Magazine 10 April 2006

http://www.harpers.org/archive/2006/04/InDefenseOfFrenchDirigisme. Accessed 9 April 2009

3. The Economist. “The French Model: Vive la Difference.” The Economist 7 May 2009

http://www.economist.com/world/europe/displaystory.cfm?story_id=13610197.

Accessed June 9, 2009

4. Barroux Remi and Rey-Lefevre Isabelle. “L'emploi salarié s'est effondré au premier trimestre 2009.” Le Monde June 11, 2009

http://www.lemonde.fr/economie/article/2009/06/11/l-emploi-salarie-s-est-effondre-au-premier-trimestre-2009_1205472_3234.html#ens_id=1115932. Accessed on June 11, 2009