How’s Your Compulsory Holiday Giving Coming Along?

December 23, 2011

by Mario Rizzo

I wish people would perform the following intellectual experiment. Find out how much in federal taxes you have paid in the past year. Don’t worry about making any distinctions between the various payroll taxes and the income tax. It all goes into the same pot in the final analysis.

Now assume that this amount is in an account and that you are not allowed to spend any of it on yourself or your immediate family. Nevertheless, you are given a choice about how to spend it. What would you spend it on? Now compare that with what the federal government spends on. How do they match up?

How many of us would spend this money on:

  1. The Iraq War
  2. The War in Afghanistan
  3. Subsidization of other people’s mortgages (Fannie and Freddie)
  4. Prohibiting adults from smoking or otherwise ingesting marijuana
  5. Subsidizing agricultural businesses
  6. Sending arms to the Egyptian military
  7. The state budget of Israel
  8. Paying for the retirement incomes of people you have never met and know little about
  9. The budget of the Palestinian Authority
  10.  The abortions of the fetuses of strangers
  11. The imprisonment of non-violent drug offenders?

 

You can make your own list. The key to the experiment is to get away from the thought that this is the government’s money and really think of it as yours.

Now it is true that the experiment “evades” various collective action problems. But let’s us imagine that your allocation would provide a significant portion of whatever public good may be at issue.

What I am getting at is this. To what extend does government spending really reflect what you actually care about? Wouldn’t your allocations be more concerned with the people and conditions around you? Would they be devoted to problems, causes or people you really know something about?

 

10 Responses to “How’s Your Compulsory Holiday Giving Coming Along?”

  1. Jett Rucker Says:

    I don’t like sending arms to Israel, either. Or to ANY country, in fact, including over 50% of what the US takes for ITS OWN arms.

    Our losses to government spending only BEGIN with the loss of tax collections. Most of the spending ITSELF works against me (and you, and most of the rest of us). Practically all of it COULD harm me, and the bulk of it (e.g., sending arms to Israel) actually DOES hurt me (I’m from Palestine, but live and pay taxes in the US).

  2. Peter Lewin Says:

    Jett, don’t single out Israel, the only democracy in the Middle East. Billions go to Egypt, the Palestinian Authority and even Hamas (via the UN) not to mention many other dictatorships around the world. Let’s cut them all! I would suggest that sending money to the corrupt leaders of the Palestinians may hurt you more in the long run than sending money to Israel.

  3. Art Carden Says:

    But surely you realize that these are all public goods that would be improvised without government, right?

  4. Art Carden Says:

    ^not provided. Stupid autocorrect.

  5. Mario Rizzo Says:

    Hayek makes some interesting points that relate to this theme in The Road to Serfdom.

    In daily lives we create (discover?)our hierarchy of ethical and other values. Much of this is based on facts we know, what we sympathize with and the alternatives we pereceive as viable. The kinds of values state action reflects are things like: should the elderly get more income (Social Security) or should young people starting out in life pay lower taxes? The obvious honest answer that the citizen should give is: How the heck should I know? And it is precisely because “we” do not have a common, hierarchy of such (moral) values, the political outcome is the result special interests and political power.

    We give up our autonomy to the dealers in political power — to the least of us, morally speaking

  6. Bill Stepp Says:

    This is a silver lining of sorts, as expressed in the words of Will Rogers:

    “Be thankful we’re not getting all the government we’re paying for.”

  7. RKN Says:

    The key to the experiment is to get away from the thought that this is the government’s money and really think of it as yours.

    I don’t have any problem thinking the money is mine; it’s the many other people who vote it out of my hands.


  8. You can make your own list. The key to the experiment is to get away from the thought that this is the government’s money and really think of it as yours


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