On Greed and Ignorance, i.e., Fiscal Cliffs

Ah, the "fiscal cliff."

It looms, portentously.

What is anybody doing about it?

Nothing -- see next Q and A.

When will we go over it?

We've already gone over it. Now the only thing to discuss is which rock(s) we will dash ourselves upon first.

How did we get to this point?

The short answer: Politicians are politicians -- what else did you expect them to be?

What do you mean by that?

I mean that we have abandoned this country's founding principles, and left our future to the politicians.

And just what is it about politicians that is bad for our future?

They always choose the short-term benefit over the long term. They choose whatever they judge will maximize their chances for re-election.

But why is the short-term outlook necessarily bad for us in the long run?

Think of rats on an eighteenth-century wooden ship at sea. In an effort to reach the grain in its hold, they have gnawed holes everywhere, including in the hull, and water is leaking in. But they have found their way to the grain. For the short term, they will not be hungry; but in the longer term, they will drown along with everyone else on board the ship.  The eighteenth-century rats are the equivalent to today's politicians.

And how do the politicians manage to get away with this?

Easy. They pass idiotic legislation to maximize their chances for re-election (think "earmarks," "subsidies," and "bailouts"). The fiscal effects of these laws then create a "debt limit crisis", as we approach the maximum amount we are allowed to borrow under the law, since we do not have enough revenues to finance the total level of their spending. Then they run about and scream: "Crisis! Fiscal cliff!" -- as though it were not all their fault in the first place. And then they vote to spend more money which the country does not have, and to raise the debt ceiling so it can borrow more, and life goes on as before.

But why does this scheme work? Why do not sensible people, who know that there is a limit to what one can borrow to spend, not bring the process to a halt?

Ah, now you are on to something.  The reason is what I call "the Curmudgeon's Corollary to the 'Tragedy of the Commons.'"

And what is the "Tragedy of the Commons"?

Check out this link for a simple explanation.

OK, I begin to see what you are talking about here. But what, specifically, is "the Curmudgeon's Corollary"?

It's really just an adaptation of a principle which has been known since Aristotle, and even earlier. The ancient Greek philosophers observed that democracies decay once they discover the power to distribute to all their citizens the wealth of the successful ones. The Curmudgeon's Corollary is more adapted to current times. It says: "The great majority of citizens will behave like rats on a sinking ship: they will see to their own gain and benefit first, even if it means that eventually everyone drowns."

But why can't people act differently? Why do they have to be greedy at others' expense?

You are seeing the results of what Christians call "man's fall from grace." Ordinary people simply cannot do otherwise, because everyone is fallen.

And does everyone bear responsibility?

Yes -- Republicans and Democrats; rich and poor; liberal and conservative. In the final analysis, they all act against their own long-term interests in order to benefit what they see as the short term.

But why, then, are the Democrats so popular just now, and the Republicans so unpopular, as we approach the "fiscal cliff" on December 31?  Aren't the Republicans more to blame for their unwillingness to compromise?

You mean: compromise on whether the ship sinks faster or slower? The reason is simple: Democrats are pursuing the shortest-term strategy of all: "Tax the rich, and our troubles will be over, because we will have even more money to spend. Those nasty Republicans just want to cut all your benefits, and let the rich keep their money."

And why is that exactly the "shortest-term strategy of all", rather than letting the rich stay rich?

Because you could confiscate, at a rate of 100%, all the wealth today in America, and keep the government operating on its current level of spending for only about nine months. And then what would you do, for more revenue? The Democrats have no plan for that; they say only: "Let's tax the rich more today, and worry about tomorrow later." That is a grasshopper philosophy, exactly as in Aesop's fable about "The Ant and the Grasshopper."

Are the Democrats, then, just appealing to class prejudice and envy?

You could be charitable, and put it that way. But what they are actually doing is far, far worse than that. 

And what is that?

They are making everyone think that Government alone will take care of them, and provide all the solutions. All they have to do is vote in favor of taxing the rich more than they are already taxed, and "Government" (i.e., the Democrats) will magically take care of the rest. The latest polls show that the vast majority of Americans are in favor of raising taxes on the wealthiest among us, while they are also against cutting any benefits that might affect them personally. Does that tell you anything?

Actually, yes, it does. It tells me that we have already gone over this "fiscal cliff."

Exactly.