Saturday, November 26, 2011

Days of Bread, Circuses, and the Budget Supercommittee

For those of you who didn't pay attention in ancient history class, let me be the first (OK then, the second) to let you know that the Roman Empire was not in fact brought down by the barbarian hordes  (or even the World of Warcraft Horde for that matter).  In fact the Roman Empire had already brought itself down, its moral and intellectual foundation having so crumbled that the first strong wind would bring it down.  It was there waiting for a tipping point, when a group of people who had once been in the service of the Empire, had the vitality and the drive that Romans once had, and were willing to earn what they needed to keep from starving (by fighting if necessary), reached the center of this empire to pick at the remains of the carcass that was once the greatness of Rome.

That greatness began to fade when the politicians (in this case the Emperor and Senate), continued to try to maintain power by giving the citizens what later became known as 'bread & circuses'.  It was Government at that point, that provided food made from the grain confiscated (taxed) from subjugated lands and peoples, and entertainment to keep them distracted from how bad things had actually become and unaware of the storm growing around them. 

Like many throughout history, the Romans soon enough discovered that the strength required to maintain an empire exacted far more than gaining it. They also learned the tragic lesson of empire that eventually the producers begin to resent those living off their labor, a resentment which will sooner or later boil over.  Unfortunately for most empires, by the time they realize these facts, they also realize that once you give citizens something that they have not earned for themselves, it's ever more difficult to withdraw it and stay in power.   Like every government before and since, they failed to learn the lesson of history that 'there's no such thing as a free lunch'; and that eventually all things must be paid for. (Of course this is a much simplified version of ancient history, but one with no factual errors that should stand up to fairly close scrutiny.)

Step forward some 15-18 centuries (depending on where you wish to begin the fall of Rome), and view now the 'empire' of the United States. (Anyone who says it's not an empire is kidding themselves. But look at a map of the location of these united 'States', and the 'territorial possessions' of this country and make your best case.)  We too are seeing our 'bread and circuses' in the form of entitlement programs handed out by a ruling elite to a common man.  (I make no comment here about the desirability of such entitlement programs, but many will be able to draw the comparisons.)

Now we see a nation just passed the $15,000,000,000,000 mark in national debt (and yes, that's 15 trillion and those are 12 zeroes).  The nation is functionally bankrupt, except for its ability to print money and functionally reduce the 'value' of the debt owed.  The upper house of Congress, the Senate, controlled by Democrats since 2007, has failed to pass a budget (good, bad, or indifferent) since April of 2009.  The House of Representatives (or lower house) , controlled by Democrats from 2007-2011 and by Republicans from early 2011 to the present, has recently passed budgets, but ones which they knew would never pass in the Senate.

In the most recent 'kick the can down the road' confrontation, the two parties once again managed to accomplish next to nothing.  No agreement to cut spending (or even significantly reduce the automatic annual increases in spending was achieved). Neither was any realistic look to increasing revenues as an offset made by closing some of the gaping loopholes in the tax code that they themselves had previously created under pressure from lobbyists and well-to-do contributing constituents.  Instead they managed to defer the jobs for which they were hired and sent to Washington for (regardless of party) to a 'Super Committee' which would, because of its smaller numbers, supposedly be able to do the heavy lifting that this larger and politically fractious group of apparent Statesmen could not.  

Not surprisingly, since most of those appointed by both parties were firmly entrenched in the political posturing of their masters, this so-called 'Super Committee also failed in its task; a failure which supposedly will lead to drastic and unsupportable cuts in the government across the board, to the tune of $1.5 trillion over 10 years.  Setting aside the trivial number involved, considering the size of the government budget and that of the debt, we find that most of these cuts are a twisted form of "Wimpy Economics" at best, where cuts are made tomorrow for tax increases imposed today.  Any actual cutting however, is usually pushed out far enough that by the time it's must be done, no one remembers it's there; making it easy for those in power to conveniently forget about it and never make the cuts.

But this is OK, according to those in power, because it allows the politicians to enter the 2012 election year with clean hands and not being directly responsible for either the raising of taxes on those contributing to campaigns (or many of those voting).  Neither are they responsible for any cutting part of the unsustainable entitlement funding that many of those not paying much in the way of taxes (also a significant voting bloc) have come to count on as part of their fair share.

Congress and the Super Committee have once again provided us a valuable lesson in ancient history, and as we see them continue to provide the modern form of 'bread and circuses' we cannot help but wonder if it will turn out better for us than it did for the Romans.  I doubt it ....

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