Hornberger's Blog

Hornberger's Blog is a daily libertarian blog written by Jacob G. Hornberger, founder and president of FFF.
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Fiscal-Cliff Antics


The fiscal-cliff deal shouldn’t surprise anyone. A sufficient number of Republicans caved, enabling President Obama to bask in the glory of causing Republicans to vote for a massive tax increase.

What did the Republicans get in return with respect to federal spending?

Not one darned thing. On the contrary, they agreed that the “cuts” in federal spending that were going to go into effect as part of the “fiscal cliff” would be suspended for at least the next two months.

Why do I place “cuts” in quotation marks? Because under the so-called fiscal cliff, there really isn’t any reduction in federal spending at all. That’s what the statists, including the mainstream media, never point out. The fiscal-cliff “cut” is actually an increase in federal spending.

Why do they call it a “cut”? Because the increase in federal spending is not as much as federal officials had hoped for and planned for. That’s what a “cut” in federal spending means in Washington and within the mainstream statist press.

Just to make sure everyone gets the point, suppose, hypothetically, that the government is spending 1 million dollars a year. Let’s say that federal officials hope to spend $1.5 million next year. Instead, they are allotted $1.2 million. That’s what statists call a “cut” in federal spending and get all freaked out about. Statists say that if federal officials don’t get the full increase in federal spending they hope for, America will fall off a scary “cliff.”

What a crock. That’s what the Republicans got for their cave in — they gave the welfare-warfare bureaucrats the full increase in federal spending they had hoped for, at least for the next two months, after which they will undoubtedly cave again.

And who did Republicans levy their massive tax increase on? Succumbing to the envy and covetousness that go to the heart of the welfare-warfare state, Republicans joined with Democrats to plunder and loot “the rich.”

Feeling his oats, Obama has already announced that he has no intentions of negotiating any spending decreases as part of the upcoming debt-ceiling deadline. That’s the deadline by which the federal government is prohibited from incurring any debt in excess of the amount of debt already incurred by the government.

What this demonstrates, of course, is that the real battle for the future direction of this country is between libertarians and statists, with the latter group consisting of both conservatives and liberals.

Statists want to have the government continue spending ever-increasing amounts of money, no matter how much the government must tax, borrow, and inflate. Statists say that that that’s the key to economic prosperity.

Libertarians, on the other hand, say that ever-increasing spending, taxes, and inflation are the key to economic bankruptcy and moral debauchery. The key to economic prosperity lies in reining in federal spending, taxes, and inflation and, in fact, in dismantling the entire welfare-warfare state, which depends on monies that are sucked out of the private sector.

What should Congress have done with the so-called fiscal cliff? From a short-term fiscal standpoint, it should have drastically reduced spending to the level of existing tax revenues, without raising taxes on anyone. Yes, that would mean a real cut in spending, one totaling about 1 trillion dollars.

Sure, that might mean pulling out of Afghanistan right away or slashing Social Security, Medicare, Medicaid, farm subsidies, and foreign aid to dictatorships or laying off a large number of DEA agents or major downsizing of bureaucracies or canceling some road-building projects.

But statists are so emotionally vested in their beloved federal welfare-warfare state that the thought of reducing any portion of it is too psychologically devastating to them. They just can’t bring themselves to do it, and they even convince themselves that their failure to do it is actually beneficial to America.

But it’s not. As the people of Greece have learned — indeed, as people throughout history have learned — out of control government spending leads precisely to where libertarians have long said it would lead — to economic and financial bankruptcy.

In the next two months, as the debt ceiling is reached and that scary “fiscal cliff” is reached again, the statists will again be harping on the horrors of the “deficit” — the amount of money being spent in excess of tax revenues. It’s one of their favorite sleights of hand, which they’ll use to call for more tax increases to “close the deficit.”

But the “deficit” isn’t the problem. The problem is that the government is spending too much.

The ultimate solution to this entire mess, however, is not just to slash federal spending but instead to dismantle the entire welfare-warfare state apparatus, along with the taxes that fund it. It’s time to admit that it was a giant mistake to abandon our nation’s heritage of economic liberty and a constitutional republic in favor of a system based on plunder, envy, covetousness, empire, and militarism.

Repeal every single welfare-state program, including Social Security, Medicare, Medicaid, farm subsidies, and foreign aid, including aid to favorite pro-U.S. dictatorships. Repeal the drug war. Dismantle the bureaucracies. Close the overseas bases and bring all the troops home and discharge them. Get rid of the vast military-industrial complex and the national-security state apparatus. Repeal the federal income tax. Abolish the Federal Reserve and restore sound money to our lives.

Embrace economic liberty and reject statism. That’s the solution to the statist cancer that is destroying our nation’s body politic.

This post was written by:

Jacob G. Hornberger is founder and president of The Future of Freedom Foundation. He was born and raised in Laredo, Texas, and received his B.A. in economics from Virginia Military Institute and his law degree from the University of Texas. He was a trial attorney for twelve years in Texas. He also was an adjunct professor at the University of Dallas, where he taught law and economics. In 1987, Mr. Hornberger left the practice of law to become director of programs at the Foundation for Economic Education. He has advanced freedom and free markets on talk-radio stations all across the country as well as on Fox News’ Neil Cavuto and Greta van Susteren shows and he appeared as a regular commentator on Judge Andrew Napolitano’s show Freedom Watch. View these interviews at LewRockwell.com and from Full Context. Send him email.