Small Thoughts: Article

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12-22-2010

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Coming Home
To Roost

Subject: Money For Nothin' and Your Chicks For Free

"For many, immaturity is an ideal, not a defect." — Mason Cooley

Since the founding of this country, each generation has faced its own unique set of difficulties and struggles, whether those happened to be droughts, floods, fires, tornados, earthquakes, hurricanes, wars, abolition, suffrage, civil rights, economic depression, or any number of other natural or man-made challenges. The economic, social and environmental problems that confront us today have their own unique character, but are actually no worse than many of those of the past.

However, there is a fundamental change that has occurred in our society that does not bode well for our future. Where once the majority of people understood that they must face their problems with the will and strength of character to perform the work necessary to overcome obstacles, this is no longer the case. Today, we now find ourselves in a society where a sizable segment of the populace has been trained to abdicate this responsibility and simply rely upon government management and its financial assistance to mitigate any hardships needing to be faces. Effectively, we now have a class of perpetually dependent, aging adolescents who have never been required to "grow up" and assume the mantle of responsible adulthood. How did we arrive at this state?

The Erosion of the American Work Ethic:

America was colonized by people who understood the value of hard work and perseverance. Traveling across the Atlantic with few possessions, effectively cut off from European aid or assistance, the early settlers knew that their survival depended upon their ability to address whatever circumstances presented themselves. So important were these characteristics, that they became codified as religious virtues, handed down from generation to generation in what sociologist Max Weber would later come to classify as the Protestant work ethic. The great accomplishments and economic growth achieved throughout the history of this country are the result of this spirit of productiveness and personal drive exhibited by so many people in pursuit of their dream of creating a better life for themselves.

Another principle shaping the founding character of this country was the virtue of independence or self-reliance, best seen embodied in the concept of individual rights as delineated in the Declaration of Independence. The recognition that each person was master of their own life, with the unfettered liberty to guide themselves in a manner of their own choosing, implied an acceptance of the responsibility for dealing with their personal survival and happiness. In this country, the future was in one's own control, to be principally determined by the consequences of one's actions.

From the 17th through the early 20th centuries, the causal relationship between the application of effort, perseverance and self-reliance could be clearly seen resulting in a steadily increasing prosperity, which conveyed an extremely important lesson to each subsequent generation. In general, the American culture was acknowledged as having an optimistic view of the future with a "can-do" spirit, where, with hard work, anything was possible. Opportunities were limitless, while resignation and defeat were not treated as viable options. Still, there were counter-forces at work destined to undermine this positive American psyche.

Of course, there was the ever-present call for self-sacrifice which has permeated every society on earth. The philosophy of altruism was the antithesis to the value-based culture of the United States. Whereas individualism preached productiveness and pride in one's achievements, altruism demanded the relinquishing of all that was valuable, and a sense of shame in one's abilities. While the goal of individualism was personal happiness, the end result of altruism was the embrace of pain and suffering as noble. In practice, Americans rejected the worst aspects of altruism, but at the same time, lacking a proper philosophical defense against its teachings, accepted the psychological burden of guilt for having repeatedly failed to live up (actually down) to its anti-life requirements.

However, the greater damage to American culture began in earnest with the inception of the welfare system. The existential roots of welfare in the United States extend back to 1642 with the creation of the first compulsory public school in the Massachusetts Bay Colony. Here, the acquisition of an education was declared to no longer be the responsibility or each individual, but a "right". And at the same time, it was also dictated that these individuals no longer retained their free choice in deciding if, when, and by what means, they would pursue that education. Instead, authorities would compel them to attend school at the prescribed place and time, for the mandated duration, studying predetermined subjects and material. In addition, other working member of society would then be forced to bear the cost for providing this newly created "right".

And so it began. Whenever a so called "positive right" to a good or service is introduced, it carries with it two direct consequences: the undermining of one or more inherent natural rights (in this case, life and liberty), and the forced enslavement of those who are required to provide the good or service to others. Furthermore, the creation of two opposing groups — the providers and the consumers — leads to indirect psychological consequences: resentment on the part of providers, and a demanding expectation on the part of the consumers for what they have been told is their entitlement.

The imposition of the modern welfare state began in earnest with Franklin Roosevelt during the Great Depression of the 1930s, was dramatically expanded by Lyndon Johnson in the 1960s, and has been continually growing ever since. And assistance is no longer limited to individuals in need, but now encompass groups, businesses and entire industries. We are all familiar with the ubiquitous Public Education, Social Security, Medicare and Medicaid benefits, but that only scratches the surface of the many assistance programs that our legislators have created over time. A quick review of a few news articles revealed the following currently active programs:

Industries

Agricultural Subsidies

Art Subsidies and Grants (NEA)

Biomass Subsidies

Education

Energy Subsidies

Export-Import Bank Loans

Fisheries Subsidies

Import/Export Controls

Manufacturing Extension Partnerships (MEP)

Mining Subsidies

News Subsidies (NPR, PBS, PRI, etc.)

Tariffs

Technology Subsidies

Ethnic, Religious and Trade Groups

Affirmative Action Programs

Faith-Based Services Funding

Minority Business Subsidies

Indian Casinos, Land, Resources, etc.

Special Privileges for Ethnic Groups

Religious Tax Exemptions

Union-Specific Legislation

Corporations and Businesses

Bailouts (TARP, etc.)

Government Contracts

Overseas Private Investment Corp. Loans

Publically Funded Infrastructure

Research Grants

Small Business Administration (SBA)

Tax Abatements and Deferrals

Families and Individuals

Aid to Families with Dependent Children (AFDC)

At-Risk Child Care

Automobile Tax Credits

Child Care and Development Fund

Child and Adult Care Food Program

Community Development Block Grants

Earned Income Tax Credit (EITC)

Education

Elderly Nutrition Program

Energy Investment Tax Credits

Food Stamps

Foster Care

General Assistance (General Relief)

General Assistance Medical Care (GAMC)

Head Start

Home Mortgage Financing

Housing Assistance for Low Income Households

Insurance Programs (FDIC, Medical, Catastrophe)

Interest Reduction Housing Payments

Job Corps

Library Subsidies

Low Income Home Energy Assistance

Low Rent Public Housing (HUD)

Maternal and Child Health

Medicaid

Medicare

Pell Grants

Pensions for Needy Veterans

Rural Housing Loans and Mortgages (USDA)

School Breakfast and Lunch

Social Security

Social Services (Title 20)

Stafford Loans

Summer Youth Employment

Supplemental Security Income

Training for Disadvantaged Youth and Adults

Transportation Subsidies

Women, Infants & Children Food Supplements

Workforce Investment Program (WIN)

That's sixty-six different programs or categories of aid currently available from the federal government. Some of these you have certainly heard of, while others may be unfamiliar. However, it turns out that this list is incomplete and there are actually more federal programs out there. How many would you guess?

80?
100?
150?

Early in 2010, Chris Edwards reported the following interesting fact on the CATO Website:

"January 22, 2010 is a day that should live in infamy, at least among believers in limited government. On that day, the federal government added its 2,000th subsidy program for individuals, businesses, or state and local governments."

2,000 Assistance Programs!

This I had to see for myself. So on December 3rd I went to the website for the Catalog of Federal Domestic Assistance and discovered that the CATO report was incorrect. There were now actually 2,088 program! As I was researching this article, I returned to this site every few days, and upon each visit discovered additional aid programs had been created in my absence. Just between December 3rd and the 20th, six new programs were established. for a current total of 2,094. This means that during 2010, Obama and the Congress were creating new programs at a rate of two per week. And how many of these did the administration inform us of in the name of its pledge for openness and transparency?

The Department of Health and Human Services alone administers 410 different programs while the Department of Agriculture has 226. And the Christopher Columbus Fellowship Foundation has not one, but four separate programs available. Here is a breakdown of the different categories of available aid:

Something free for everyone! Well, not everyone. Because, as noted above, somebody has to actually pay for all this stuff.

Personal Welfare:

Where once people understood that it was their responsibility to work to feed themselves, starting in 1933 the federal government stepped in with the Civilian Conservation Corps to create emergency make-work projects for the unemployed. By 1935, at its peak, the CCC engaged roughly 506,000, and after it's nine year run, a total of three million men had passed through its ranks. Seventy-five years later, facing another economic downturn, work is no longer actually required, as unemployment benefits have been cemented into our culture, not as an emergency response which you are expected to earn through hard labor, but as an entitlement to be demanded by right. As of December 4th, the four-week rolling average showed an active enrollment of 4,232,750 people, with Congress and the Administration negotiating to extend these benefits, yet again, to a total of 155 weeks, or three years, with no indication that there is any fixed end in sight.

During the 1960s, with the intent of helping people living in poverty, numerous state and federal entitlement (welfare) programs were instituted in response to perceived needs. Yet, after decades of tinkering with these policies, study after study revealed that the long term impact on the recipients was an increase in the creation of unlivable slums, the further destruction of the two-parent family, elevated teen and unwed pregnancies, a disincentive to seek out work, rising school dropout rates, and a corresponding reduction in a child's IQ. In addition, children of welfare recipients were shown to be much more likely to be dependent upon these programs once becoming adults. By 1995, the number of people on on the welfare rolls had risen to a staggering fourteen million. And why not. After all, they're entitled to these benefits aren't they? Today, due to subsequent program reforms, that number on direct government assistance now hovers around five million.

For many, an important aspect of the American Dream is the acquisition of a house of one's own. For generations, the possibility of home ownership has been a powerful motivator, causing individuals and families to work hard and save diligently so that one day they could realize their dream. The recognition that years of work and savings were involved in order to make such a large purchase, clearly conveyed the enormous value that a home represented. And everyone understood this—until the federal government got involved. In 1938, as part of the New Deal, the Federal National Mortgage Association (Fannie Mae) was established to broaden the secondary home mortgage market by funneling federal funds into banks, to be converted into affordable housing loans. In 1970, a second Federal Home Loan Mortgage Corporation (Freddie Mac) was established by Congress for essentially the same purpose. With the belief that everyone was entitled to the American Dream, politicians, throughout the 70s, 80s and 90s, put more and more pressure of these two institutions, demanding that they significantly expand the number of families able to purchase their own homes. The result was a significant lowering in the standards required to qualify for a mortgage, with millions of families taking on a debt liability which they could not afford to repay, and acquiring property, the value of which was not properly appreciated. When the inevitable foreclosures came, these same people were indignant at having been "cheated" out of their homes, which they had been repeatedly told were theirs by "right".

The message is clear: Your future is insured. Should you struggle and fail—or simply not struggle at all—the government will step in and manage your life, providing for you not simply the basic necessities, but the luxuries as well. Personal responsibility and self-reliance are no longer the coin of the realm. It is your need that matter, and we are here to take care of you, because that is your birthright as an American. Sit back and take it easy. You're entitled!

Corporate Welfare:

The 20th century was the heyday of private corporate research, with businesses reinvesting a sizable percentage of their profits back into R&D intended to yield future business innovations. These companies often employed scientists in a variety of field, allowing them the freedom to explore areas of pure research which often resulted in startling discoveries leading to a large number of Nobel Prizes. Some of the more notable corporate research facilities included:

AT&T's Bell Labs, which was responsible for inventing radio astronomy, the transistor, the laser, the UNIX operating system, the C and C++ programming languages, information theory, large-scale integrated circuits, CCD sensors, and the discovery of the cosmic microwave background radiation.
Xerox's Palo Alto Research Center (PARC), the birthing place of the modern personal computer, including invention of the bitmapped display, the graphical user interface (GUI), mouse, laser printing, ethernet, what-you-see-is-what-you-get (WYSIWYG) text editing, object-oriented programming, along with the liquid crystal display (LCD), the optical disc, IPv6 protocol and the Smalltalk programming language.
IBM's Thomas J. Watson Research Center, in conjunction with numerous other worldwide research facilities, created magnetic storage systems, the FORTRAN programming language, invented the relational database, speech recognition, the token-ring network, the Blue Gene super-computer, the scanning tunneling microscope, wrote the SABRE commercial airline scheduling system, and discovered high-temperature superconductivity and fractal geometry.
GE's Global Research Centers which were responsible for the vacuum tube as well as the fluorescent and halogen lamps, the first television broadcast, the jet engine, non-reflecting glass, silicone chemistry, the seeding or clouds, the auto-pilot, Lexan polycarbonate resin, artificial diamond production, solid-state lasers, and magnetic resonance imaging (MRI).

Of course this merely scratches the surface in the history of the innovations created through efforts of private enterprise. Yet, despite this stellar historical track record of rapid advancement, government has found a need to intervene, undermining the foundation of private research through the public funding of agricultural, scientific, technology and industrial research, either through public universities, or by grants and other subsidies given directly to businesses. According to a CATO report, the direct and indirect subsidy to private businesses in 2006 was $92 billion. Today, with the TARP bailouts, stimulus bills, pork buried in trillion dollar budgets, and the FED's inability to keep track of $9 trillion(!), the size of the corporate welfare system is difficult to estimate accurately. However, a few things are clear:

First, as CATO puts it, this public-private partnership clearly breeds an "incestuous relationship" where businesses lobby government for special favors, and government officials extract kickbacks (also known as "campaign contributions") in exchange for back-room promises to wield influence on behalf of the paying business.
Secondly, government influence ultimately ends up directing research away from promising avenues of investigation as identified by smart, creative individuals, and towards areas which supports a predetermined political agenda — perverting the scientific method in the process. There are numerous examples of this, but none so clear as the abomination concerning the public funding of climate science research, turning it into the corrupt handmaiden of political interests.
And third, when one business can fund its research and development programs at the taxpayer's expense, this frees up those previously allocated funds to be directed towards other areas, including supporting the businesses bottom line. Competitors, still responsible for their own development costs, are now placed at a significant disadvantage and either learn to also feed at the public trough, or eventually close their doors.

Public funding of research, as well as all other forms of business subsidies, are like a cancer. Once introduced into the free-enterprise system they slowly advance, killing the thriving private organisms, and leaving a malignant form of corrupt Fascism in their place.

Learned Helplessness:

From Wikipedia:

"Learned helplessness, as a technical term in ... human psychology, means a condition of a human being ... in which it has learned to behave helplessly, even when the opportunity is restored for it to help itself by avoiding an unpleasant or harmful circumstance to which it has been subjected. Learned helplessness theory is the view that clinical depression and related mental illnesses result from a perceived absence of control over the outcome of a situation."
"One of the most intriguing aspects is "vicarious learning (or modelling [sic])": that people can learn to be helpless through observing another person encountering uncontrollable events."

This description of learned helplessness gets to the essence of what is most damaging in all government programs of assistance and regulation. Each time the government acts to intervene, it sends a clear and powerful two-pronged message:

You are not responsible
You are not in control

Accepting responsibility is the essence of adulthood. Approaching our life rationally, we gather experience and knowledge in order to prepare ourselves for the challenges that the we may encounter. As we acquire more skills and understanding, we gain confidence in our abilities and take pride in our willingness to face the future, whatever it may hold. And because of this, our life becomes an exciting adventure to be embraced, rather than an exercise in fearful caution. But all of this may be undermined if one believes that they have no control over their destiny and no responsibility to choose and guide their future course. Yet this is exactly what the government does to so many.

While professing to help people in need, every government action does more harm than good, by stripping the recipient of the dignity of their adulthood and forcing them to accept the role of helpless child. When this is repeated over and over, the message is reinforced and the "helplessness" simply becomes the norm. Seen in this light, it is no wonder that so many on welfare rarely demonstrate the initiative to pull themselves out of their impoverished conditions, when every incentive to do so has been destroyed by the government's oh so unhelpful hand.

Fortunately, the culture of entrepreneurship still thrives in this country, providing an outlet for those motivated by the thrill of a challenge and the opportunity to test one's abilities to the fullest. Start-ups and small businesses have generally flown under the government's radar and been relatively free of its strong-arm regulatory controls. But as a business becomes more and more successful, it draws the government's attention and the game changes. Where once a business leader's judgment was his or her ultimate guide, and the responsibility for success or failure rested squarely upon their shoulders, the encroachment of rules and regulations imposed from the outside destroys that simple calculation. When it begins to be more important to address the requirement of the bureaucrats than those of the market; when pleasing some politician rather than the customer becomes the standard of business success; when the majority of your profits flow in from Washington D.C. with strings attached; then you are playing a child's game of appeasement, and no self-respecting adult would agree to submit to those terms. So the adults are systematically driven from the ranks of big business, leaving their operations to those of undeveloped character, lacking independence, integrity and pride.

In this country, there have now been four generations raised under the ever increasing presumption that the government is Big Daddy, here to protect his children from the consequences of a complex, unpredictable and painful world. Not everyone has succumbed to the message, but enough have that it brings into question whether there remains a sufficient number of people still possessing the character required to address the difficult choices we now face. Will this country react like the petulant children we see demonstrating and rioting in Greece, France and Britain when faced with reality, or will it stand tall, as a proud adult, and act to preserve its future? We shall soon see.

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