The sign above is for the Fossil Ridge Intermediate School here in St. George, UT. It is my daily reminder that spending other people’s money is fun and leads to dumb spending. A simple wood sign, or cheap metal would have sufficed to let us know what school this is. And do I need to know “Washington County School District” in big bold letters even above the name of the school? It is sign that only someone spending other people’s money could love. Sure… it isn’t THAT expensive. But just look at everything involved in a school – little stupidities add up.
Jim Powell of the Cato Institute (a libertarian think tank) says that government deciding how to spend our money isn’t nearly as effective as letting us do it:
Permanent, across-the-board tax cuts would probably do more than anything else to give employers, investors and consumers confidence that they could make plans for the future. Some of the most important rules of the game would become more predictable, not a subject of annual political scheming – a source of economic uncertainty and instability.
He says that government directed spending has three problems (KN – at least!):
- Temporary. People make economic decisions on permanent income streams, not spikes
- Timing distortions. Small towns get fancy new office buildings. Not needed. Not wise. But they had to get the money spent “now”.
- Careless. The OPM (other people’s money) syndrome kicks in – people are stupid with resources that aren’t their own.
Ultimately, politicians do not pay for stupid spending decisions they make with other people’s money. Or more precisely, they are rewarded by spending it it unwisely but in places that get them campaign donations and or blocks of votes. Private individuals spending their own money are much wiser and not corrupt.
A move to make our spending decisions wiser and more efficient would drastically cut government’s role in directing where our resources go. That means massive spending cuts and much lower taxes.
It won’t happen without massive resistance by productive people. Who will go first? I guarantee you they will be locked up quickly. Never get between a government and other people’s money.
I favor a flat fee per adult citizen that funds government. I want everybody to feel the same pain when government spends. I think that will make their spending wiser – and keep all of us freer.