Any sound system of modern democracy
must start with budgets if our nations are not to drown themselves in
debt in order that those who are to be its stewards are to promise
that which cannot be paid. As described in the book Democracy in
Deficit by James Buchanan and
Richard Wagner, in the 1970s, the moral restrictions upon
spending and the tacit, though often unfulfilled, understanding that
it is the duty of the government in power to balance the budget have
been broken asunder. Since then governments have been running
unparalleled deficits while promising unparalleled privileges to
their citizens.
Some of this is certainly politicians
promising more benefits (often while promising to simultaneously cut
the deficit) to voters during election seasons in order to match
their opponents own proposals, but the main cause is certainly the
lack of any structural traits in government to actually keep spending
in check. Year after year, politicians can continue to run government
that borrow a considerable portion of their entire operating expenses
without any constitutional measure that provides disincentives
against such practices.
A free and open society is not a
society governed by the arbitrary actions of politicians, aristocrats
or emperors. King Charles II learned that the hard way in 1688 and
even the British monarchs have been subservient to their parliaments
in the years since then. Instead, it is ruled by general rules of
conduct, laws, that apply to everyone, every where and under all
circumstances. In his book, The Theory of Moral Sentiments (Part
III, Chapter VI), Adam Smith writes about how the virtue of justice
is one that is at all times dictated by general rules of conduct:
The
rules of justice are accurate in the highest degree, and admit of no
exceptions or modifications, but such as may be ascertained as
accurately as the rules themselves, and which generally, indeed, flow
from the very same principles with them. If I owe a man ten pounds,
justice requires that I should precisely pay him ten pounds, either
at the time agreed upon, or when he demands it. What I ought to
perform, how much I ought to perform, when and where I ought to
perform it, the whole nature and circumstances of the action
prescribed, are all of them fixt and determined. Though it may be
awkward and pedantic, therefore, to affect too strict an adherence to
the common rules of prudence and generosity, there is no pedantry in
sticking fast by the rules of justice. On the contrary, the most
sacred regard is due to them; and the actions which this virtue
requires are never so properly performed, as when the chief motive
for performing them is reverential and religious regard to those
general rules which require them.
Free
people are then guided not by the will of others, but how the general
rules of society obligate them to act. Tyranny consequently is the
usurpation of those general rules for the discretion of individuals.
There
is no more of a sacred obligation of the politician to the people he
serves than to guard the public treasury. It is certainly true that
the government does need resources to operate, but it is similarly
true that the government does not ask its citizens to contribute.
Taxmen do not walk door to do holding usher's baskets requesting
contributions; instead, they just take the contributions that they
need. Whether the tax-payer consents or not, this done with the the
promise that the government will use that money in order to provide
certain services for the tax-payer's benefit. The entire enterprise
of proper government can then be seen as the process of turning the
tax-payers' money and to transform it into desired services. Hence to
take the tax-payers' money within the public purse, and to spend it
negligently on expenses that do not better his interests should be
regarded as treason.
Deficits,
though, inflict havoc upon this process. The reason that they do so
is that the government can spend more than it has in order to provide
its citizens more services that they could otherwise afford therefore
corrupting the connection between paying taxes and receiving
services. Every dollar that the government borrows is a dollar that
will have to be taken in future taxation. When the event that calls
for deficit spending is a war, the accumulation of debt does not
nearly have the corruption affect as it does when government's in
peacetime since a war is understood by the public as a temporary
event that must be financed with credit. This cannot be said of the
massive amount of deficit spending that has been taking place within
the United States to support both its welfare state and its
military-industrial complex. Neither are temporary. When it comes to
deficit spending to support both, politicians tell their voters that
the government can supply services to them that Americans'
contributions to the treasury can support. As a result, it forces
politicians to be dishonest about the quantity of services the
government can supply and it rewards those who provide the most
convincing lies about how the government can continue to provide
services without having to take more from the public.
Any
system that encourages dishonesty must be reformed. Deficit-spending
in peacetime is little more than politicians using the power of the
financial markets to evade the great inconvenience of scarcity during
their time in office. It is in ultimate juxtaposition with the ethos
of a government whose officials serve as stewards of the public
treasury. As such, it must be reformed and it must be reformed
constitutionally for the only solution to this problem are now
designed checks and balances that forces politicians to guard the
integrity of the treasury. What we need is a government that forces
politicians to actually grapple with scarcity in providing government
services and to frankly tell tax-payers that they must reduce their
expectations of government services or expect to pay more in the
future.
Besides
a law that obligates the sitting government to balance the budget, what
we need is for the budgetary process to be the defining moment in any
year in politics. Politicians need to fight over the budget, to
ear-mark every cent of government spending (the entire phenomenon of
“mandatory spending” is a conceit, all spending is really
discretionary and can be ended if necessary), and release budgets
that fit their expenditures within the contexts of a balanced budget.
If politicians want to increase spending on certain programs. Fine,
but they have to show either what other programs will be cut or how
they will be taking more money from the people they represent.
Anything less is not only a failure of accountable government, but
also a failure to ensure that citizens truly know the costs of their
government.