Moaning about the state’s massive budget crisis has become all the rage these days. Both my colleague Jack Craver and I wrote columns on the implications of the $5.4 billion debacle, which is the result not only of one of the largest recessions in this country’s history, but also of poor governmental management at the state and national levels. Calls for economic bailouts resound throughout the country, from the woefully incompetent Big Three of Detroit to the equally mismanaged financial industry. And they will get most of what they want.
At the state level, as many writers on this page — myself included — have argued to the point of redundancy, the $5.4 billion shortfall will prove disastrous for the individuals least capable of withstanding its effects — the poor and working class. Then again, with an economic situation such as this, “poor” and “working class” are rapidly becoming indistinguishable. This crisis will be manifested by more than a particularly sharp drop in the GDP in an economics textbook 30 years from now. It will show itself through simpler but more intuitive means: a rise in homelessness, increasing squalor in the country’s inner cities and far-flung rural areas, and a general feeling of malaise as Barack Obama’s anecdotal factory worker — unemployed because of some crook in mainland China — struggles to look his family in the eye. In Wisconsin, the effects will be unprecedented. The state’s unemployment fund has only five months of reserve cash, and it has taken a 38 percent hit from September 2007 to September of this year. Although the state’s relatively low unemployment rate of 5 percent is by no means disastrous — especially when compared to the national rate of 6.7 percent — the uncertainty of the country’s economic future would presumably merit a much higher degree of preparation. However, such preparation would only be possible if spending on prisons was drastically reduced — along with a number of social programs — and if taxes were raised significantly enough to both provide for the unemployed and pay off the state’s deficit.
However, that fantasy assumes the state is obligated to perform all of its current functions. Discussion of social policy has been relegated to the realm of arguing about how to pay for every program on the budgetary menu, and the necessity of these programs is taken for granted. Therein lies much of the reason for the state’s, and the nation’s, crisis. If anything has been proven by recent events, it is the age-old adage to never bite off more than you can chew. So why America’s reluctance to confront reality?
Make no mistake about universal healthcare, unemployment insurance or social security — these things will largely be financed by printing and borrowing money — money the country has no possibility of repaying. In Wisconsin’s case, a strong unemployment assistance program, universal health insurance and an increasingly mediocre education system will owe their funding to tax increases and cuts in equally vital programs. Either way, both the national and state governments must stare the numbers in the face: government cannot usurp the role of Jesus Christ. Instead, rational but superficially cold-hearted steps must be taken to assure the place of both state and country in a world that has no mercy for jobs and ways of living that are relics of nostalgia rather than truly productive endeavors. The state and federal governments should renew their commitments to increased educational and technological progress at the temporary expense of the unemployed and poor.
Justifications for such a policy shift abound. The relatively pleasant standard of living that most Americans now take as a casual presumption was not the result of FDR’s radical “innovations” in social policy such as social security — now easily America’s largest IOU — but rather the fruit of massive investments in both education and technological development, best symbolized by the G.I. Bill, The Manhattan Project and later, the landing of astronauts on the moon. And indeed, Malthusian Stagnation — the process by which the population of a country was supposed to expand in exact proportion to its food supply — was only made obsolete by the advent of the Industrial Revolution. Although distribution of the wealth was left to social planners, the essential fact remains: technological progress bodes much better for society’s most vulnerable elements than radical economic tampering in place of that technological progress. And yet ours is the first generation in the country’s history that may very well be less educated than its parents were. A college degree has now taken the place of a high-school diploma, and all the while a quality college education has increasingly become the province of the wealthy. If the state — however you define it — is truly concerned with the welfare of its people, it should look beyond quick fixes and shed its obligation to blocs of voters. Politicians should instead do the responsible thing and relinquish its insistence that government can singlehandedly rescue every millworker in Ohio with a flick of its financial wrist. If only it were that simple.
Sam Clegg ([email protected]) is a sophomore majoring in economics.