A Boondoggle by Any Name

The ongoing infrastructure fiasco and debacle in Washington, D.C. is entirely indicative of why government is inefficient and ineffective and why Central Planning fails forever and always.

The true infrastructure bill, which comes in at over $1 Trillion, has legitimate bipartisan support. In fact, it has already passed the Senate. It has sat unaddressed for more than two (2) months in the House of Representatives, where it also enjoys bipartisan support.

That such a significant spending bill enjoys the support of both legacy political parties should not be surprising. Physical “Infrastructure” (e.g. highways, bridges, railways, ports, airports, utilities, etc.) is generally accepted to be among the fundamental functions of government (if not an entirely inherent or necessary function).

In order for cooperative action to be successful, there must be mutualities of commitment, contribution, and benefit. The almost universal acceptance of government acting in this role gives rise to the mutuality of “commitment.” Infrastructure has historically been paid for (at least in part) with excise taxes (e.g. highway use tax) and user fees (e.g. on airline tickets). Anyone, who travels, contributes to the associated taxes; therefore, there is mutuality of “contribution.” Finally, the resulting infrastructure is universally available to be used for anyone’s benefit (either directly or indirectly). Thus, we have mutuality of benefit, and all necessary mutualities are present.

That is not to say that it is a perfect system, or that there is not room for improvement, but a system that includes these mutualities is more likely to be successful than one, in which they are entirely lacking (or decidedly disproportionate). Where the mutualities are present, then parties are likely to come together voluntarily in order to advance their mutual benefit and common interests. Government involvement under such circumstances is superfluous and likely counterproductive. In the absence of such mutualities, no amount of government interference or coercion is likely to make the endeavor successful.

Nevertheless, proponents of government action often seek to utilize the coercive and compulsory powers of the state in order to force reluctant parties to participate in transactions or relationships, in which those parties would not otherwise voluntarily engage and which are likely disadvantageous to the interests of the reluctant parties.

What could be more “fair” than the user of a product or service paying a fee for his use and that fee being commensurate with the extent of use or consumption (or the associated cost)?

However, some persons argue that such funding mechanisms are “regressive.” They argue that those, who are more capable of bearing the costs, should bear the (entire) costs, even if that means that some (or most) users or consumers pay little to nothing for the benefits received. There is a growing expectation of a “free lunch.” Throughout the halls of Congress, the trope can be heard: “Don’t tax you … Don’t tax me … Tax the fellow behind that tree.”

Dr. Milton Friedman famously said, “There is no such thing as a free lunch,” and today many persons would argue vehemently that their government benefits (e.g. Social Security, Medicare, etc.) were not “free” because they paid … something. In their minds, those are “their” benefits, and they are simply getting “their” money back. However, that is not the case. If one pays pennies on the dollar for a product or service, then some portion of the benefit derived is either “free” or at least uncompensated by the beneficiary.

A token payment may give rise to a sense of entitlement, but it does not represent adequate compensation or remuneration to the provider(s). This also represents a necessary distinction between “taxpayers,” being those who pay some taxes (notwithstanding that many such persons ultimately receive more in direct benefits than they actually pay), and “net taxpayers,” being those, who are primarily responsible for funding government and whose “contributions” arguably outweigh any conceivable benefit that this limited and shrinking pool of net taxpayers might receive.

Nevertheless, the Infrastructure bill is languishing in the House, which is entirely controlled by Democrats. The bill could pass without a single Republican vote, but it is being held hostage. It is being held for ransom. It is being used to extort support of ANOTHER “Infrastructure” bill.

The spending wish list, which falls under the very broad “infrastructure” umbrella of this second bill, is euphemistically referred to as “Social Infrastructure” or “Human Infrastructure.” As with many things recently, the change in vernacular is intentional.

Proponents wish to give the impression of something “substantive” — something justifying long-term “investment.” However, the expenditures for the most part are not for brick-and-mortar projects but are Social Welfare (i.e. Charity). Some may argue, “But, the associated spending ‘benefits’ nearly everyone.” Even if true, that does not change the “charitable” nature of the expenditures.

Coerced charity or compelled altruism is not indicative of moral behavior on the part of either the contributor or taker(s). Never is one more generous than when he is spending someone else’s money (for his own benefit).

The originally proposed price tag was $3.5 Trillion. That is over $10,000 per citizen and over $40,000 for a family of four. How many “beneficiaries” expect to pay their share of those expenditures?

To the extent that one receives a benefit, for which (s)he does not pay commensurate value, (s)he is receiving charity. Many us do not like to think of ourselves as “charity” cases. We do not like to think of ourselves on the public dole or on “welfare.” Nevertheless, that is the reality.

The mindset is, “If government pays ‘us’ then it’s ‘free money.’” But, it is not free. The proverbial government money tree yields no fruit. Every dime of government’s largess must be taken from someone. What might seem like a windfall to some is necessarily taken from others in the forms of increased taxes and/or opportunity costs. Theses costs must be imposed upon SOMEONE.

Most beneficiaries presume that THEY will not pay the costs for their own benefits. Otherwise, the entire conversation would be moot. Instead, they presume that the costs will fall upon some disfavored minority (i.e. the infamous “One Percent” or the more nebulous but still much-maligned class of “rich”).

However, beneficiaries rarely anticipate that those costs will be pushed down in the form of higher prices for products and services, and when the takings from the “rich” are insufficient to sate the increasing and incessant demands from a growing dependent class, the taxes will fall upon those, who are not “rich” by any reasonable standard. None of this even takes into consideration the financial burdens, which are placed upon generations of Americans, who cannot speak up in order to protect themselves and their interests, because they are either too young to vote or yet unborn.

Such spending — and all deficit spending generally — is institutional theft on a grand and historic scale. It does not feel like theft because none of us wants to consider himself a thief. Therefore, we interpose government between the would-be beneficiaries and the objects of the takings, and the booty is denominated a “tax.” It is thus more “civilized.” One may even argue that the forced takings are morally motivated.

It does not feel like theft because an electoral majority is among the beneficiaries. The majority enjoys a perverse moral certitude, which it mistakenly believes can be derived solely from its number. However, collective action cannot be used to hide individual “sins,” and one cannot enjoy the absolution, which might be offered by even a host of co-conspirators.

It is an example of the self-serving ends being used to justify ignoble means. It is the use of government in illegitimate ways and in roles for which is ill-suited. Therefore, it is destined for failure.