Why we can't get things done: economics case analysis

¶ … Government Intervention When Seeking to Solve Social Problems

Less is more.' This has become an acknowledged design principle when redoing a home, a wise caveat to obey when ordering a caloric meal at a restaurant, and even an architectural aesthetic embraced by most modern builders. Why can our nation's legislators not accept the same concept of minimalism in regards to the American system of government? It seems almost laughable that the nation was founded upon the ideals of 'don't tread on me,' and 'no taxation without representation,' as articulated by Patrick Henry in the 18th century, has become a nation that looks to government, rather than private businesses and charities to find the solution to both age-old problems like poverty and modern problems like affordable healthcare. Instead, taxation, with the aim to treat such ailments through increased government funding has gotten out of hand. And the solutions to a wide array of social ailments with complex social causes still remains elusive, despite increased government funding of federal and state programs. Government officials with little expertise in social work, health care, or the issues that lie at the root of suffering, hunger, and want, now blunder about with taxpayer dollars, attempting to 'do something' more in an attempt to make the nation feel better, rather than to assuage the problems.

It is only understandable that, when confronted with the sight of poverty and suffering, the gut instinct of many compassionate Americans is to want to do something to remedy such difficulties, and legislators respond to this commendable emotional impulse. Unfortunately, the solution of 'doing something' in today's modern times has become turning to government regulation, rather than attempting to productively generate a freer environment so people become more capable of helping themselves. In fact, through too much government intervention, the nation's government has only made the problem worse.

For example, Edward Banfield, in the Unheavenly City, blames a psychological culture of poverty and reliance upon others, which results in insufficient thought for the future, as the source of the continued woes of the poor that are always 'with us' in the world, regardless of the historical era. This culture explains why some immigrants can succeed, and help their children to prosper, while other groups and families grow entrenched in dependence. (Rivlin 366) Some subcultures reward initiative and future-thinking more than others, hence different people respond differently to economic problems, either with proactive or passive personal strategies. Moreover, according to Banfield, the poor will always be present in society in some number. The question is how to help people see that they have enough freedom and opportunity to extricate the next generation from the cycle that perpetuates the culture of poverty.

Bluntly put, less government regulation and taxation might help a poor person open up their own business, but more government handouts in the form of welfare and food stamps simply encourages continued dependence rather than entrepreneurship. It is the concept of feeding a person for a day, rather than teaching them to fish for life, that underlines the modern concept of the social welfare state that Banfield abhors. In her case study entitled "Why Can't We Get Things Done?" Alice Rivlin of The Brookings Institute suggests that common concepts of so-called right-wing villainy suggest that anti-big government advocates have racist or class-based assumptions in their opposition to expanding government programs. But it is just as easy to respond that the belief that certain persons are unable to utilize the capitalist marketplace to their own advantage, as people have been doing for centuries to better their lot in life, just as long as there has been hunger, poverty, and ignorance, is just as degrading an idea. The left may demonize the corporate raider as overly powerful in society, but is the government bureaucrat any less free of influence, any wiser, or possessing of any more truly useful solutions that will heal societal injustices? Better to leave it up to the marketplace than to simply 'do something' ineffectual that wastes taxpayer's dollars and siphons money from the legitimate economy into wasteful and unproductive government programs.

At present, the current welfare system in America covers millions of people, gives many of them a non-living wage, yet also provides a disincentive to find paid work for persons who are able to make the system 'work' for them. States have varying levels of coverage, and persons trying to work and lift their families off the welfare roles and out of poverty are taxed so prohibitively they have no incentive to follow through upon their best, innate impulses to seek productive employment. But a national welfare system and standard seems unfeasible, because states vary so greatly in terms of what constitutes a truly livable wage in the area, and also because the prosperity of the economy varies greatly over the course of years or even the annual business cycle. (Rivlin 370) Low-paying jobs are also unpleasant, and when taxed at 20 cents on the dollar, doing much less for a little less coverage is a powerful incentive to remain on the dole. (Rivlin 371) Taxing people less on all levels of government for the money that they earn, even if this required reduced coverage, would be the best solution, although an expensive solution, given how the financial needs of state and federal programs have grown so bloated. Reduce social programs coverage, reduce the bloat, and cut taxes -- a cruel, painful, but productive long-term solution.

We may be failing to solve social problems, not because of moral failings but because we do not know how to treat them, writes Rivlin. Take one goal that both anti and pro-government advocates would agree upon -- the need to prove universal health care to all Americans. Liberals wish for all Americans to have health care out of compassion, and even conservatives are angry at the current waste, fraud, and over-use of emergency facilities as sites of primary care that characterize the American system of treatment. Moreover, paying health insurance premiums is often costly for big business, and prohibitively costly for small employers. In short, the current state of affairs hurts everyone, regardless of political ideology.

But how to ensure that everyone has access to care and quality care is a more difficult question. National coverage may guarantee access, but not necessarily speedy or even effective treatment. Also, there is an incentive to abuse the system, because it is free, which can contribute to long waits for care. Partial reimbursement, as exists within the HMO system at present on a private level, has resulted in extra layers of bureaucracy as insurance companies endlessly debate the values of certain kinds of treatment, when a referral is acceptable, and if a procedure is covered or necessary. (Rivlin 369) Placing the government in the role of an HMO (health maintenance organization), arbitrating the necessity of certain procedures, would only place even less knowledgeable health authorities in a position of trust.

Even HMOs, given the varying debates that exist in American medicine, have trouble deciding what procedures are necessary for certain groups but not others. Should women in their thirties have mammograms? If not, what if they have a family history of breast cancer? Is psychotropic medication like Prozac necessary for people suffering moderate depression, or is Prozac a dangerous drug? These questions are difficult for even doctors to decide, or public health officials, and to give more control, as would be necessary in a national system of coverage, to federal authorities would be to dilute the quality of medicine further, and not necessarily expand access to preventative care.