Wednesday, October 2, 2013

U.S. Government ‘Shutdown’, or the Big Yawn

Who Cares?

By Pater Tenebrarum and originally published at
Apparently the unresolved back and forth between House and Senate concerning the 'Obamacare' bill in the run-up to the debt ceiling cut-off date on October 17 will lead to what is breathlessly referred to as a 'government shutdown' in the media. Wish that it were so, as an actual shutdown would have the salutary effect of demonstrating that very few are going to particularly miss the government.

In fact, one wonders why the recent stock market decline is blamed on this looming shutdown (which essentially consists of the cessation of 'non-essential services'. If they are 'non-essential', why do they even exist?). Stock market participants should be glad that government meddling in the economy might be temporarily interrupted.

On this occasion it may be worth considering the definition of government's nature by German sociologist Franz Oppenheimer (in his 1926 book “The State: Its History and Development Viewed Sociologically”):

There are two fundamentally opposed means whereby man, requiring sustenance, is impelled to obtain the necessary means for satisfying his desires. These are work and robbery, one’s own labor and the forcible appropriation of the labor of others. [… ] I . . . call one’s own labor and the . . . exchange of one’s own labor for the labor of others,

the ‘economic means’ for the satisfaction of need while the unrequited appropriation of the labor of others will be called the “political means.” [...]

The State is an organiztion of the political means.”

So what is about to be shut down is the “organization of the political means for the unrequited appropriation of the labor of others”. What can be bad about that?

Of course there have been 17 such 'shutdowns' over the past four decades, and none of them actually amounted to a true shutdown. Mainly the whole show is about whose favored pork barrel projects are going to receive funding. There may be a handful of representatives in Congress and the Senate who are genuinely concerned about the public debt, but they are few and far between. Even the most reviled and 'harshest' cost cutting proposals are merely about slowing the speed at which government spending will grow, not about actually reversing the government's debts and deficits.

Left or Right, it Doesn't Matter

Wrangling over the 'debt ceiling' (which might as well not exist) tends to break out whenever the administration is in cohabitation with a Congressional majority in the hands of the opposition party, especially in those instances when there is a Democratic president and a Republican Congress. The Republican party generally tends to rediscover fiscal discipline almost exclusively on these occasions (Republican administrations have a well-deserved reputation for spending like drunken sailors).

Here is how Lew Rockwell described the mindset of US conservatives and left wing liberals with regard to the issue of government in a 2006 article:

Regarding conservatives he writes:

“On domestic policy, the government is the enemy. We need to scale back government spending and regulations that tie up business in red tape. The public schools are failing and need an injection of competition. Too many welfare programs are out of control. Taxes are too high and too complex. Politicians and bureaucrats shouldn’t run our lives, lest liberty be lost. Let’s return to our founding principles and return government to the people.

On foreign policy, we are surrounded on all sides by enemies. Dangers lurk everywhere. We need to strike them before they strike us. We must not shirk our responsibilities to ourselves and the world. We need not fear the use of power, even war, even relentless global war. We cannot cut our defenses. Our allies need us. We need not listen to the cowards who would recoil from this struggle against evil because freedom isn’t free. If anything, we need to beef up military spending.”

Regarding left-liberals he writes:

“The left often offers the inverse of this recommendation. They believe that the government can’t but unleash Hell when it is waging war and spending on military machinery. But when it comes to domestic policy, they believe the same government can cure the sick, comfort the afflicted, teach the unlearned, and bring hope and happiness to all.”

And the synthesis of these inherently contradictory stances is provided by the bureaucratic State as follows:

“Each side presumes that it potentially enjoys full control over the government it instructs to do this thing as versus that thing. What happens in real life, of course, is that the public sector — always and everywhere seeking more power — responds to the demands of both by granting each party’s positive agenda while eschewing its negative one. Thus is the left given its welfare, and the right given its warfare, and we end up with a state that grows ever more vast and intrusive at home and abroad.”

And this is indeed how the cookie crumbles. Governments come and go, but the vast apparatus of the State remains in place and keeps growing.

Why anyone would worry that a few unimportant appendages of this apparatus are going into suspended animation for a little while is beyond us. True, the treasury is running out of accounting tricks to keep the total debt below the old 'ceiling', and an extreme case that would undoubtedly have financial market repercussions is at least imaginable – such as for instance an interruption of debt or interest payments, but it isn't terribly likely that it will ever come to that. There will be a smattering of political theater for a a few days or weeks and then things will continue precisely as before – and there will of course be sudden lurch higher in the reported total funded debt, as government readjusts its accounts.