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IS THIS HOW DEMOCRACIES PERISH?

us-government-we-need-a-tow

It’s election season in both the United States and the United Kingdom.   People on both sides of the Atlantic are enduring the nightly trauma of electioneering.

The good news is that, in the UK, the election will be over in two weeks.   On the other side of the pond, we have another nineteen months and a few days to go.

Watching both elections on television, I’ve been asking myself:  Is this how democracies perish?

Every politician seems to promise the moon, while at the same time avoiding any issue of substance.

There was a time when government had only two responsibilities – national security, without which there would be no country, and the maintenance of a stable currency, without which there would be financial chaos.

That’s all changed in the last hundred years.   Now governments have their hands in everything – and the electorate responds by holding out their own hands begging for more.

Can we ever turn the clocks back to the big two?   Life would be a lot better all round if government got off our backs and concentrated on nothing but defense and currency stability.

For all its claims to be a “people’s republic” (a communist term), China’s government doesn’t seem to do anything except defend the people and ensure the stability of their currency.   Of course, the role of the military in China involves a great deal of oppression.   But, when it comes to the economy, they have a free enterprise system that is working a lot better than any of ours in the West.

The British government boasts of a growth rate that is less than 3%, while China laments theirs is down to only 7%.   Whose system works best?

The Chinese government is not likely to look to the Bible for inspiration, but they should heed the lessons contained in I Samuel, chapter 8.  In this chapter, the people asked Samuel for a king, like all the other nations.

God was not pleased with this and warned the people of what to expect:

10 So Samuel told all the words of the Lord to the people who asked him for a king.   11 And he said, “This will be the behavior of the king who will reign over you:   He will take your sons and appoint them for his own chariots and to be his horsemen, and some will run before his chariots.   12 He will appoint captains over his thousands and captains over his fifties, will set some to plow his ground and reap his harvest, and some to make his weapons of war and equipment for his chariots.   13 He will take your daughters to be perfumers, cooks, and bakers.   14 And he will take the best of your fields, your vineyards, and your olive groves, and give them to his servants.   15 He will take a tenth of your grain and your vintage, and give it to his officers and servants.   16 And he will take your male servants, your female servants, your finest young men, and your donkeys, and put them to his work.   17 He will take a tenth of your sheep.   And you will be his servants.   18 And you will cry out in that day because of your king whom you have chosen for yourselves, and the Lord will not hear you in that day.” (vs 8-18)

You get the idea.   This is the first recording of Parkinson’s Law, that government inevitably expands, costing the tax-payer more and more money.   The problem in the US and UK is democracy, with the people wanting more and more.   Inevitably, this leads to government expanding.   It’s a warning to China not to democratize!

We have a special election in Michigan in a few days.   A proposal is being put before the people to raise the sales tax by another 1%.   It may not sound like much, but if you buy a used car for $10,000 right now, the tax will be $600.   After the vote, it would be $700.

The money is to be used to fix our roads, which would be a disgrace even in Africa.

While many will vote “yes” because they are tired of their cars hitting massive potholes, they are failing to look at the bigger picture.   Where has all the money gone that was previously allocated to roads?   If they look closely, they will find that it’s expanded the bureaucracy and given employees higher salaries and greater benefits, in the form of pensions and healthcare.   It has also been revealed that the state department responsible for roads has lost the warranties on roads that were previously fixed by private contractors, meaning that the taxpayer will have to pay again for the same repairs!

Additionally, the state has been wasteful.   Detroit was bailed out to the tune of $191 million.

A new “Welcome Center” is being built at the Capitol, costing an estimated $100 million.   A new State Police headquarters was built for $38 million, when the previous building was quite adequate and rented for $1 per year thanks to a generous donation.   The list goes on and on.   Waste, waste and even more waste.   It’s easy to spend other peoples’ money.

Government is inherently profligate.   The less we have of it the better.   Our ancestors understood that, which is one reason why Great Britain and the United States rose to great wealth and power.

Sadly, their descendants think that more government is the solution to every problem.   As we go down this road, the burdens on the taxpayer will only increase until we collapse under the weight of our own excess.

Perhaps we should all learn a lesson from HSBC, the world’s third biggest bank.   The Hong Kong and Shanghai Banking Corporation moved its headquarters to London when Hong Kong reverted to China.   They are now thinking of moving back, to either Hong Kong or Singapore, both run by ethnic Chinese.   Taxes are lower and there is far less government regulation in these two city-states.

If they do move, it will be a big blow to London’s status as the world’s primary financial center.

This is one of those major issues the politicians are likely to avoid, as no government will stick its neck out to defend the banks.

How long our democracies last will be determined by how much government the people want.   On that score, things are not looking good on either side of the Atlantic.

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STATE OF THE UNION NOT SO GOOD

State of the Union

President Obama’s State of the Union speech, given before Congress late Tuesday, took me back fifty years.

In October 1964, the British people voted into power a Labour (socialist) government after thirteen years of Conservative rule.

Obama’s promises last night reminded me of the Labour government’s agenda.

The theme running through both was this:   government will take care of you, government will provide everything.

Except for a vague tax on the wealthy, nothing was really said about how all these programs will be paid for.

Most people are aware that the wealthy can afford expensive tax accountants who help them to reduce their tax obligations, sometimes down to zero.   Nothing is going to change that.   The president and members of Congress are not about to become paupers because of new taxes – they will find a way around them, just as other wealthy people will do.

Mr. Obama promised more help for the middle class.   The term “middle class” has a different meaning in the US to what it means elsewhere, as Sky News pointed out the following day.   The middle class in the US is mostly working class people who own their own homes and have been struggling to make ends meet for quite some time.   The biggest challenges they face are rising health care costs and falling wages and unemployment.   It’s difficult to see how taxing the rich will help them.

But the promises do provide for a massive expansion of government, which will only add to the burdens of the middle class.

A few days ago, I saw, also on Sky News, a massive fire burning in South Oxfordshire in the UK.   An extensive building was on fire, the result of arson.   The person covering the fire explained that 440 people worked in this building, which served the community in various ways, including housing.   That’s 440 jobs that did not exist seventy years ago – 440 jobs to serve a relatively small number of people in the southern part of one county!

This is what the US is headed for – bigger government programs mean bigger government buildings and bigger (higher) taxes.   If history is any guide, that tax burden will fall mainly on the middle class, the ordinary people who cannot afford expensive accountants to take advantage of the inevitable loopholes.

Government is always expanding.   Here in Michigan, there is a proposal before the electorate to increase the sales tax to pay for road repair.   But it doesn’t seem that long ago that the gas tax was increased to pay for roads.   Meanwhile, the state has had to give $191 million to Detroit to help bail the city out.   An additional high figure (close to $100 million) is being allocated to build a new “Welcome Center” at the Capitol.

It never ends.

That’s exactly what God said when He warned the Israelites what would happen when they asked for a king, for a human form of government like all the other nations, choosing to reject the theocratic government He had given them.

In I Samuel 8:5, the elders of Israel asked Samuel to “make us a king to judge us like all the other nations.”  God granted them their desire, but forewarned them (v. 9) of what to expect, to “show them the behavior of the king who will reign over them.”

In a long and very descriptive passage beginning in verse 11, God showed them how the king would take more and more of their wealth to pay for what he wanted, whether it be soldiers, servants (government employees) or just spending in general.

He concludes with these words:   “And you will cry out in that day because of your king whom you have chosen for yourselves, and the Lord will not hear you in that day” (v. 18).

Of note, here is the expression “your king whom you have chosen.” This passage includes democratically elected presidents, as well as kings.

What it’s saying is that governments inevitably expand.   The more government programs we have, the more money government needs. And, as government is inherently wasteful and generally inept, the burdens on the people grow and grow.   Dissatisfaction with the state of the economy has been evident in the polls for a few years – the people are already crying out!

However, in a democracy, the people only have themselves to blame.

Fortunately, Mr. Obama, a Democrat, is unlikely to find any support for his programs in the Republican controlled Congress.   However, programs already in place continue to grow.   It’s doubtful that even a Republican Congress will be able to reverse them.

The 1964 Labor government in England was a turning point.   Three years after taking office, thanks to their profligacy, the country had to devalue its currency against the dollar.   This led to the collapse of the sterling area, made up of mostly former British colonies that traded in the British currency, a system that meant they kept most of their financial assets in London.   Twelve years later, Britain had to turn to the International Monetary Fund for a bail-out.   It wasn’t until Margaret Thatcher became Prime Minister in 1979 that the country started to turn around.

Mrs. Thatcher believed in sound money, otherwise known as living within your means.   There was no evidence of that Tuesday night when the President addressed the nation in his annual State of the Union address.