The New York Times editorial page thinks it is being very clever today when it unveils the startling news that the complaints of Republican governors and other fiscal conservatives that their states are going broke are not literally true. According to the Times, this is “all obfuscating nonsense, of course, a scare tactic employed for political ends. A country with a deficit is not necessarily any more ‘broke’ than a family with a mortgage or a college loan. And states have to balance their budgets. Though it may disappoint many conservatives, there will be no federal or state bankruptcies.”
The editorial then goes on to denounce Republicans for supporting tax cuts while also calling for “ruinous” spending cuts.
Though the newspaper isn’t entirely frank about its goal in this argument, the point here is crystal clear. It is true that neither individual states nor the federal government will ever literally go bankrupt. That is because governments have a backup plan that is not available to any family with a mortgage or college loan: it can confiscate as much of the income of its citizens as it needs to keep itself going. With this mindset, a state need never face up to the reality of budgets that are out of control due to generous benefits packages given to already well-paid government employees, as well as pork-barrel spending aimed at boosting the popularity of politicians. It can just go on merrily spending the people’s money, since the taxpayers can simply be taxed more heavily to make up the deficits.
While today’s deficits fueled by government pensions and free health-care plans have created unprecedented crises in statehouses across the country, advocates of unbridled spending and higher taxes are, as the Times editorial illustrates, undaunted. For them, there is no crisis that can’t be solved by higher taxes, since they are ideologically committed to ignoring the connection between confiscatory taxes and lower economic growth and productivity. This is buttressed by the liberal mindset that holds that any money that the government doesn’t take away from taxpayers is a gift to them.
To back up its claim, the Times cites a poll that it sponsored that claims to show that voters are not opposed to raising taxes and would be happy to dig deeper in order to keep paying exorbitant benefits to public employees. We doubt that this is true, and the evidence for our skepticism about this survey is the poll that was taken at ballot boxes around the nation last November, when voters elected politicians who vowed not to raise taxes and to address the disaster that unbridled government spending had created.
The difference between the Times and the public-sector unions whose cause it has embraced and the Republican governors is rooted in the Republican belief that the state’s ability to put its hand into the pockets of the taxpayers must be kept in check. Unless strict limits are placed on government spending and the entitlements that balloon deficits into the stratosphere, both Washington and the states will continue to tax their way into and out of any problem. The problem is, while no state will go broke so long as it heeds the Times’s advice and raises taxes to confiscatory levels, a majority of the taxpayers have rightly come to see this government gravy train as a threat to their own well-being and believe it is time to put a stop to it. While mainstream-media giants like the Times have tried to portray the governors who are acting to protect their citizens from the rapacity of these state spending machines as villains, we suspect that politicians who stand their ground on this issue will ultimately be vindicated by a public that is sick and tired of having its pockets picked by liberal spendthrifts.