Saturday, March 21, 2009

Chillin' With the Chinchillas

I've already explained that every government program is a jobs program, and that there is no such thing as “government waste” -- that is, if you're on the receiving end. Or if you like, reverse the logic and say that _all_ government expenditures are “waste” because they all disrupt the free market and violate the laws of supply and demand – i.e. they all represent things that people, as individuals, would not buy if they had the choice.

Now, it's amazing how much easier it is to understand certain things once you clear your head about these issues. But it's equally amazing how most, if not all, of our elected representatives still can't, or won't, see things as they are. An example is Rep. Dan Burton's shock and dismay that, according to the usual “rule” for these things, $55 Billion of the stimulus plan is likely to go for fraud. This is based on something called “the industry standard level of fraud” -- and, I admit, I didn't know there was an “industry standard” for this, but I'm not surprised. Heck, everything else has goals and performance criteria, why not fraud? At any rate, the standard is 7%, and 7% of $787 Billion is bit over $55 Billion. (You'd think with all those sevens in there we might be in for a bit of luck – but I'm afraid not.) So Burton characterizes this $55 Billion as “wasted” money, and adds that (get this!) “$55 Billion in stimulus waste and fraud would prompt the American people to 'march on the Capitol'.” I guess by “the American people” he means the middle class, since they're going to absorb most of the (negative) impact of the stimulus plan... but relax, Dan – the middle class has never marched on the Capitol, or on anything else, for any reason. They live in perpetual fear of the strong and the violent – like the IRS, for example – and so they can always be counted on to stand silent before their shearers.

But here's the point. How do you tell the “fraud” and “waste” part of the stimulus plan from the legit stuff? Can we tell now? In which case, can those items be deleted before so much as a dollar is spent? But no, I suspect he means money earmarked for “legitimate” purposes – things absolutely vital to the recovery of the economy – you know, like subsidies for chinchilla farmers, or a shoelace museum – that is instead diverted to the bank accounts of local operators out in the boondocks, to decorate their rec rooms or buy a trip to Branson, Missouri. But he misses the point. Either the entire stimulus program is a waste and a fraud, or none of it is. It's entirely a matter of definition. Let's say that a certain amount is earmarked for that mythical chinchilla farm – and sure enough, a check is written out to the chinchilla farmer, and he deposits it in his business bank account, and draws on it for needed supplies, overhead expenses, chinchilla stud service... whatever. But would one American citizen in a million have freely turned even a dime of their own money over to him for these purposes? No. So in that sense it qualifies as “waste”. And is the preservation of that – or any other – chinchilla farm really vital to economic recovery? Is chinchilla farming an industry that's “too big to fail”? Will the failure of chinchilla farms cause a devastating ripple effect through the entire economic system... with former chinchilla farmers standing in bread lines and collecting unemployment? No – to all the above. So in that sense the chinchilla subsidies are based on fraud – i.e. on misrepresentation of the importance of that particular industry to the economy.

And there is another level of fraud involved here as well. Nowhere in the Constitution does it say, or imply, that the federal government – i.e. the taxpayer – is responsible for bailing out chinchilla farms. But our elected representatives act as though it's printed right there in black and white, and in voting for subsidies of this sort they dare anyone to speak up in protest or try and contest it in court. So it adds up to a combination of fraud, theft, and “taunting”, as the NFL referees would say.

Plus, get this – Earl Devaney, chairman of the Recovery Accountability and Transparency Board, AKA the RAT Board (you can't make these things up!), admits that he was “horrified” by the $55 Billion figure, AND (now get this!) that “the problem will be aggravated by a lack of federal workers needed to oversee the spending.” Now, when's the last time a federal worker was willing, or able, to save the taxpayers any substantial amount of money? I think you might find one in a history book somewhere – say, back in the administration of James K. Polk. But these days? News flash – federal workers are paid to spend money; it's their job. In fact, the more taxpayer money a federal worker is entrusted with, the higher his rank and salary are likely to be. The size of your “program” is the most popular indicator of status in Washington. And not only that – there are severe penalties imposed for failing to spend your full allocation – penalties like, for instance, not getting as much the next time. So program managers are rewarded for committing, and spending, all they can, and the quicker the better. In fact, they can even be rewarded for overspending, because that way some other schmuck who hasn't been as diligent gets “dipped” for the amount of the overexpenditure. But for underspending, there is nothing but punishment and shame -- and, by the way, the "non-dispersed" portion is never, ever returned to the U.S. Treasury. So no, hiring more federal workers is no insurance against waste and fraud; if anything it will aggravate the problem, because if "tax receivers" are the junkies, then federal workers are the facilitators and pushers.

It has already been established that the thousands of “earmarked” items in the stimulus plan – i.e. the vast bulk of the plan – are, far from being “emergency”, “vital”, or even “important” programs, basically a bunch of garbage that failed to make the cut for the regular annual budget. In other words, they are loser line items that even the most spendthrift Congressman couldn't quite stomach keeping on the “buy” list. But when you have a sudden $787 Billion windfall – and all the important stuff is already paid for – what are you doing to do with the $787 Billion? Spend it on crap, of course! That's the way the system works. “Extra money” never goes for anything anyone really wants – except a few narrow, special-interest types lurking in some dark alleyway behind the Capitol. So when you see it all going for things like chinchilla farms, please understand that this is an inevitable outcome of the government budget process in general, and of the way this “stimulus program” is being handled – and that it's not going to “stimulate” squat, outside of those narrow special interests – who will, by the way, be back for more in a few months, because now they're hooked.

The good news is, we'll have plenty of chinchillas. (Now what the heck does one do with a chinchilla anyway??)

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