Public Officials Who have to Cut Social Services Are Not Creative Enough

A radical idea is flooding through the American political discourse: that the only way to “repair” government budgets is to make extreme cuts to spending on social services, like education, healthcare, parks, infrastructure and public safety. The fact is: any public official who argues there is no option besides slashing spending on quality government programs is not creative enough and cannot be said to be fully equipped to govern.

Polls now show between 80% and 90% of Americans want “cuts” only to areas of spending that are legitimately wasteful, fraudulent or abusive. Only 11% support education cuts, for instance. There is no support for cutting Medicare, Medicaid or Social Security benefits, only waste, fraud and abuse. Officials who have promised budget-busting tax cuts in order to curry favor with voters and financial backers are not serious about fiscal solvency.

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Oil Subsidies are Not Smart Spending

Oil as a combustible fuel is a 19th-century improvement on the 18th-century paradigm of burning coal to produce steam to run industrial machinery. The efficiency and portability of carbon-based fuels, in terms of the built-in energy they can store and which is released when they are burnt, has long been the driving factor in their popularity as an energy source. But new technologies are now making it possible to produce large amounts of portable energy sustainably, with none of the atmospheric damage resulting from the burning of carbon-based fuels.

In 2008, the five most profitable companies in the world were oil companies, their annual profits ranging from $20 billion to over $45 billion. No commercial entity in the history of humanity had ever made such immense profits. In 2009, two of the top 5 were banks, largely because oil companies’ profits had fallen as prices came back down to earth. In 2010, it again looks like oil companies were the most profitable businesses on the planet. They do not need subsidies to survive.

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Spending vs. Cutting to Encourage Recovery

There are some things that fit well with the phrase common sense, and some that don’t. Not everything that seems complex or uncertain is outside the bounds of reality, but some things, ultimately, just don’t make sense. There is a strong political bias that “cutting spending” is a conservative principle, because it is prudent to spend less, but whether the policy is in fact conservative, or whether it works: that is another story.

There is a powerful rhetorical draw in the idea: just spend less, and everything about “the economy” —whatever that means— will improve. This is like saying, if you provide less opportunity for investment, there will be more opportunity for investment; or, if you reduce the wealth available, the wealth available will increase; or, you need to burn the village in order to save it.

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