Punchinello’s Chronicles

December 19, 2009

Nothing You Do Matters to the Government

Have you ever wondered how the government (at all levels) can continue to do some of the harebrained stupid things we’re reading about? Have you thought that a little common sense would go a long way toward getting the economy going again? So how come it doesn’t happen? Why does it seem that politicians repeatedly throw gasoline on the fire of wasted efforts and pointless programs?

The answer is that politicians, bureaucracies and civil administrations NEVER take into account reactions to their actions!

Give this a try yourself. Take a look at any announcement, any program, and idea, any proposal or anything at all coming out of any government system. Then say to yourself that no human being is ever going to react to this proposal in any way whatsoever. ALL things will remain exactly the way they were when the government made the “plan.”

You’ll quickly see that, “Hey…that makes sense! That’s a great idea! That’s a terrific plan! That will FIX everything immediately! I vote for that!”

So for example, we hear that the government is in talks with Freddie Mac and Fannie Mae to extend their line of credit by $400-billion EACH! They’ve both already slammed through half a trillion dollars, covering the dumbass loans they forced the banks to make. Now “suddenly” it looks as if they’re going to need massive amounts of new money. How come?

Well, back when the Bush administration decided “we” needed an emergency $700-billion bailout package, that money was supposed to “fix” the exploding bubble of the sub-prime and risky home loans on the books. Many people said no! They shook their fingers, looked very stern, frowned deeply at the TV and said, “No!” The bill passed immediately!

Those people saying no, understood that as soon as the federal government (and the taxpayers) decided to guarantee all those failing loans, EVERYone would react! Banks would shift all their bad loans to the government (now the Federal Reserve’s quantitative easing program, or QE). Presto! All “bad loans” (i.e., toxic assets) would vanish from the bank’s accounting, and BAM!…move over to the black hole of national debt.

Secondly, with “someone” (i.e., you and me and everyone not in government) acting as the co-signer on all these loans, people with problems paying their monthly mortgage could relax. Or they could walk away. Which they did, and are doing so in droves.

From there we see all sorts of “unforeseen” consequences that come from messing with a complex system. But nobody at all in the government, nobody at all in the administration, nobody at all in the news media had a clue! This is all a complete and utter mystery! It’s astonishing, astounding, never-before-seen stuff! Who knew?

Suppose the government decides to raise taxes on tobacco. Why? Because they need more money. They’re spending everything they have and everything the future will provide, and they need more money. They won’t stop spending, so they raise taxes. Tobacco is killing everyone, particularly The Children, so they tell us the new taxes will be for The Children.

Now say after me: “Nobody at all will change a single part of their behavior when the price of cigarettes goes up. It’s not possible, it won’t happen, it shouldn’t be considered, it means nothing.”

Anyone who smokes will never, ever, EVER make a decision about their smoking based on new prices. Particularly if those prices nearly double.

Right?

Fast forward a year or so and the state governments are STUNNED to discover that their sales tax revenues are falling! In particular, their tobacco tax revenues are falling. They have no idea why. They can’t imagine a reason. It’s a total and absolute mystery to them!

The fact is that in the mind of bureaucrats, politicians, civil administrators and anyone who has a guaranteed public-sector job, the “world” will be exactly as they say it will be until they say it should change.

Mr. Obama has announced via the Copenhagen climate summit meeting that either he or some other group of government officials have officially stated that NO WAY will the earth’s temperature climb more than 2 degrees until he (or they) say it’s allowed to. They’ve said that the tides will cease to move until they’re told to move.

This is much like saying that General Motors will continue to be a fine car company, they’ll only make crappier cars. Why? Because NOBODY is going to stop buying GM cars! They weren’t told they could stop buying them, so…they won’t stop buying them.

You, me, our friends, and the citizens of the world haven’t been told that we should stop buying GM products. Therefore, we won’t. Either we’re utterly helpless in our actions and can only do something (or stop doing it) when we receive word from the government, or we’re too stupid to act on anything without being told to do so.

One way or another, there are only two fundamental rules to understanding Government: 1) the only reason for laws to be passed are so that someone can make a whole lot of money. 2) No human being ever will change their actions because of a government law or regulation being passed.

That’s it. Civics 101 in a nutshell. Now go out and get a college loan so you too can take part in the Great Recovery! You did get the memo, right? That letter from the government that everything is good now, and it’s okay to get back in the pool?

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