Tuesday, September 21, 2010

I'm Just Sayin'

D.C. Democrats tend to do okay, because the federal government can print money. States, unlike the federal government, cannot print money and must balance their budgets each year. Right now, the only reason many states are able to survive without massive cuts in services and layoffs is because the federal government has loaned them billions of dollars.

If your economic strategy is tax-and-spend, i.e., using tax dollars to create government jobs and to increase services, you have to make sure the private sector can generate enough revenue/taxes to support government employees and their salaries and benefits. In other words, if you want a bigger government, you have to make sure you can pay for it, which means you should also support a larger, more successful private sector. However, most people who favor bigger government want more regulation and more restrictions on corporations and businesses, which usually lower the government's revenue and therefore its growth.

Apparently the Swedes have found an economically-viable balance: high taxes and a strong private sector. They're like libertarians that don't mind high taxes because they see their taxes being used effectively. (Indeed, Sweden has one of the best education systems in the entire world.) California Democrats, on the other hand, don't seem to understand basic economics: they continue to restrict the private sector--i.e., the people paying their bills--even as they demand more government. It's like a child telling his parents not to work and instead demanding that they stay at home and take care of him. It might work for a while, but after some time, the child will be homeless and destitute, perhaps regretting the decision to restrict his parents' time and efforts. Right now, though, California seems happy to have major industries leaving the state and choosing to hire elsewhere. It remains unclear how the state is going to pay for the bigger government it wants.

Bottom line: if you vote for a pro-union, pro-regulation Democrat without having a financial printing press ready to go, it's like having sex without a condom--stupid and unsafe.

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