Posted: 03/10/09 22:59
by Dave Mindeman
Do the math.
Whenever anyone says that I guess the insinuation is supposed to be..hey, this is simple. It all adds up.
Craig Westover, at the Minnesota Free Market Institute, likes that phrase. Using mathematics is good for discussions. It is straight forward and answers are absolute. You don't have to fudge with math....it is what it is.
Westover thinks that the approach to government and the economy is mathematical, especially regarding taxes. His favorite tax number is zero. Taxes have a zero sum gain on economic activity. They are bad. Bad for everything. They stifle the free market and prevent the business community from its pre-ordained, systematic growth.
Do the math. $5,000 of taxes is $5,000 wasted. Flushed away.
Except I think pure mathematics in regards to government and the economy only seems to work in Westover's little parables.... you know the stories you make up to illustrate your point.
The only trouble with parables is that they are good teaching tools but lousy for real world examples.
Just to review Westover's latest parable:
Do the math. A family, let us postulate that they are well-to-do, is sitting at the kitchen table about to sign a contract with a home remodeler to build an addition on its home for $10,000. But just before they sign a newspaper article catches their eyes. It relates how the state of Minnesota will raise taxes in their bracket by $10,000 a year. This sobering news makes the prudent family reconsider, and it does not hire the remodeler to build the addition on its home.
Charlie over at "Across the Great Divide" was intrigued by the story and actually did some math. Check out his analysis here.
Hmmm.. maybe Westover's "math" is not so absolute.
The mathematical dust up even caught the attention of "Spotty" over at "The Cucking Stool" and left Spotty and the gang concerned for Westover's peace of mind.
However, let's get back to the real world, where the rest of us live. This is where government and the economy deal more in Algebra -- you know the stuff with all the variables.
Westover has a rather disparaging opinion of government services:
But sooner or later, $10,000 in taxes converted into salary for a non-essential government worker is $10,000 removed from the discretionary income of people who earned it. The $10,000 the government worker spends on himself is $10,000 taxpayers (in aggregate) do not have to spend on themselves. The $10,000 the government worker spends with some in the local community is $10,000 the person who earned doesn’t spend with different businesses in the local community. That scenario, however, does not represent an equal swap. The families earning the aggregate $10,000 earned the money and when they purchase products or services they are willing to pay for, wealth is created and vendors are rewarded. The non-essential government employee does not earn his salary (he may work hard for his money, but he produces no equivalent value); the government employee consumes wealth.
Well, let me counter with a little parable of my own, an algebraic parable if you will:
Westover's mythical family is attempting to do a remodeling project for $10,000. Let's say that the family has to pay no taxes because we have suddenly been transported into a utopian, libertarian world where government only exists for the national defense. The free market rules. The family has found a contractor willing to do the project for the price they are willing to pay. However, the contractor is delayed because several roads leading to the family residence have not been kept up and are now impassable. Several homeowners in charge of their section of the street have been deficient in repairs. The contractor is also requesting that Westover's family needs to contract for better security because the contractor wants to leave materials in the driveway. A snowstorm has also developed and the contractor has informed Westover's family that they will need to hire someone for snow removal in order to keep the street and work areas clear.
As they begin work on the project, they soon discover that the neighbors private septic system is encroaching on the family property and that it will be difficult to work around it -- it may cost some extra money. One of the neighbors has also decided to operate a business out of his garage....the street is full of cars during the day and the contractor has difficulty moving his equipment in and out of the area. More delays... and the contractor is saying the delays are not his fault and will cost extra for the additional labor time.
As the work continues, the contractor hires a new company to sub-contract the electrical work. They decide to use some short cuts to save a few bucks and don't have an electrical code to slow them down. During the night, the shoddy work results in an electrical fire and the house begins to burn. The nearest fire department that would be willing to contract with Westover's family for service is over 10 miles away and the snowstorm forces them to take detours.
They get to the house too late. It has burned down.
So, there is the end of the parable. I will not outline its meaning...I will let you decide that.
After all...2 + 2 =4 ....doesn't it?
