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Stupidity and the State

The Wall Street Journal
June 7, 2008
By Ernest S. Christian and Gary A. Robbins

Last August, the government lost track of six nuclear warheads that ended up in cruise missiles affixed to the wings of B-52 bombers flying over American cities. The Federal Emergency Management Agency recently spent $2.7 billion to purchase 145,000 formaldehyde-soaked house trailers. They were for use by people who'd lost their homes when levees designed by the Army Corps of Engineers broke and flooded New Orleans. The FBI is currently forcing its most skilled and experienced antiterrorism field supervisors to accept "promotions" to paper-shuffling jobs in Washington.

But the millions of inanities that occur daily throughout the government's world-wide empire are mere trifles compared to its big-ticket failures.

What kind of government forces people to make gasoline out of food, artificially boosts the price of corn to $6 a bushel, guarantees that inflated price as the "base" for higher federal subsidies to corn farmers in the future, and then tries to hide its own depredations by excluding high food prices from its measure of "core" inflation?

Washington never learns from its mistakes. In "The Worst Hard Time," Timothy Egan notes how federal price supports encouraged farmers in World War I to plow up millions of acres of dry grasslands and plant wheat. When the price of wheat crashed after the war, the denuded land lay fallow; then it blew away during the droughts of the 1930s, turning a big chunk of America into a Dust Bowl.

On top of everything else, Washington tries to cover up the cost of its failures and incompetence by officially misstating the government's financial results. For instance, the government says that the tax burden will be $2.6 trillion in 2008. But counting the "deadweight" loss from damage done by taxes to the private economy, the real tax burden is twice that - roughly $5.2 trillion, according to various estimates, including ones published by the National Bureau of Economic Research and the Congressional Budget Office. On the spending side, a study by the Office of Management and Budget showed that government programs on average fall 39% short of meeting their goals. Thus, in 2008, government will spend $2.7 trillion to provide $1.65 trillion of benefit.

A real tax burden of $5.2 trillion to pay for a $1.65 trillion benefit seems a bit excessive, even by Washington standards. Perhaps one of the presidential candidates should do the voters the courtesy of at least telling them the truth, and asking them if they really want quite so much government at such a high price. Then again, maybe the voters already sense the truth, and perhaps that is why they are so furious.

Mr. Christian, an attorney, was a deputy assistant secretary of the Treasury in the Ford administration. Mr. Robbins, an economist, served at the Treasury Department in the Reagan administration. They are writing a book about the abuse of federal power.