On Tuesday, the Cyprus parliament voted “no” on a measure that would have allowed the government to confiscate up to nearly 10 percent of all deposits in Cypriot banks. The measure was proposed after European Union countries threatened to withdraw lending support from the troubled country unless depositors shared the costs of the bailout. There is a lesson in this for the United States: When government is allowed to spend with impunity, ordinary citizens sacrifice their rights to a government-imposed concept of “fairness.”
Many Americans call conservatives “hard-hearted” because they insist that government borrowing so much money to spend freely on everything from Obamacare to free cellphones is a bad idea. These same Americans think that our government can and should do more. They also think that higher taxes are the way to finance increased social spending, but that borrowing trillions of dollars is not really a problem.
Politicians have an incentive to promise more, of course: It is a really good way to win elections.
As Cyprus’ bank depositors almost found out, though, when the piper must finally be paid, it will not be the politicians who pay the price. There, depositors faced demands by Germany, the International Monetary Fund and the European Union to simply confiscate between 6 percent and almost 10 percent of all deposits held in Cypriot banks. Banks were closed and ATM machines left empty to facilitate this government-sanctioned theft. At the last moment, facing riots in the streets and worldwide financial markets in turmoil, the idea was ditched. Yet just the fact that it almost happened should teach us something important.
Here in the United States, we annually spend almost $1 trillion more than we have. Instead of trimming wisely — as common sense dictates — we are pummeled by pundits, legislators and the White House that more and more from government is possible if only those with more money would pay their “fair share.”
What is a “fair share”? Those earning more than the magical number of $250,000 a year already pay more than 70 percent of all income taxes, while almost half of all American citizens pay no income taxes at all. Is this “fair”?
Businesses should pay more, we are told — especially big businesses. The plain truth is, businesses just pass along the cost of taxes either to their own workers by depressing wages and benefits, or to consumers by raising the prices of goods and services. Does President Obama not realize that the “fair share” paid by businesses are really paid by average Americans?
Of course he does. This is a useful fiction, however, built on an imaginary definition of “fairness” that pits citizen against citizen to inflame class-warfare passions. We who actually earn money, build businesses, invest and save are the sheep who must be more closely sheared for the new social-welfare state to take hold. In Mr. Obama’s vision, hard work, determination, imagination and risk-taking are no longer the primary determinants of success. By this definition, only politics decides who gets what.
Europe has been struggling to limit spending, but when push comes to shove, debts will be paid by those who have scrimped and saved or by those who have achieved success. Those who are fleeing socialist-leaning France know that there is no such thing as government taking “too much.” Confiscating deposits in Cypriot banks is just the latest assault on citizens by governments who will accept no responsibility for the same kind of unsustainable spending ambitions now advocated by Mr. Obama and liberals here in the United States.
Even the lightest cuts to our spending have inspired dire warnings from our leaders. White House tours will be stopped, national parks will open late, air traffic will be delayed, teachers will be fired, needed research will be curtailed and illegal immigrants will be released. When citizens started asking how much the president’s golf trips cost, the White House tours started up again. We should be asking a lot more questions about spending. The answers may shock those who are footing the bills.
I do not care to know, for example, why lesbians are generally fatter than straight women, yet our government just awarded a $1.5 million research grant to answer this question. There are thousands of such expenditures every year that, while tiny compared to the overall budget, add up quickly to hundreds of billions of dollars — our dollars.
They are the measure of a government that feels entitled to spend citizens’ money without restraint. There is little or no interest in discriminating between spending on those who need it and on those who expect it.
Perhaps someday soon, like the idea almost forced upon Cyprus, the increasing debt from such profligacy will be paid by confiscating what we have deposited in banks after a lifetime of work. That’s only “fair,” right?
Ken Hoagland is the founder of Restore America’s Voice.