Bob Murphy poses a probing question to those who argue that government debt is no (or only a third-order, trifling) burden insofar as that debt is “owed to ourselves .” Bob’s question deserves – although is highly unlikely to get – a compelling answer. I myself will ask again: does house burglary and car theft impose no net costs as long as “we steal it from ourselves”?
Every thinking person implicitly knows that the U.S. government is the world’s biggest financial fraudster. The cumulative yearly fraud by government actors is well in excess of $1 trillion and takes many forms. It begins with the IRS overcharging citizens by doing such things as engaging in “asset forfeiture” — that is, seizing banking accounts and other property of individuals and businesses who have not been convicted of any wrongdoing. The IRS taxes the portion of capital gains due solely to inflation as “income” when it is clearly not.
Government is notoriously mismanaged, wasteful and fraud-ridden. Last May, the Economist magazine reported: “In 2012 Donald Berwick, a former head of the Centers for Medicare and Medicaid Services (CMS), and Andrew Hackbarth of RAND Corporation, estimated that fraud added as much as $98 billion, or roughly 10 percent, to annual Medicare and Medicaid spending and up to $272 billion across the entire health system.” Similar amounts of fraud are found in most every federal government program — Social Security, food stamps and other welfare, defense spending, and now Obamacare. A private company subject to the degree of fraud, waste and mismanagement found in government would soon be driven out of business.
Mississippi State University finance professor Thomas W. Miller – a visiting scholar at George Mason University’s Mercatus Center – explains that community-college education shouldn’t be free to community-college students.