More Tales of Revolution and Government Waste

Tunisia…Egypt…Libya…a half dozen others on the brink…

While restless masses across the Middle East and North Africa region are struggling to realize democracy in their own lands, many here in the USA are just now waking up to some of the not-so-pleasant effects of it. The expression of discontent is more or less the same in each country. The results? Well, we’ll have to wait and see…

In the beginning, democracy seems a virtuous and decent enough solution to autocratic tyranny. And it is…so long as the process is populated with virtuous and decent people. During the seeds of revolution, dictators are quickly overthrown and the people usually obtain a “voice” through the ballot box.

Everyone feels part of the progress, part of the plan. Love, hope and jasmine. All that good stuff.

But democracy has the regrettable tendency to remain in the hands of the virtuous and the decent for precious little time. As Winston Churchill once suggested, democracy is “the worst form of government…except for all the others that have been tried.” It wins by default, in other words.

Over time, once the fanfare of revolution begins to fatigue, the democratic political system matures toward a kind of tyranny of the majority. By the time people get around to voting other people’s property into their own hands, the game is more or less over. And while oppressive regimes like those of Ben Ali, Hosni Mubarak and now Muammar Gaddafi present easy targets for freedom-seeking individuals, it’s much easier to topple a dictator than to topple “of the people, by the people,” no matter how big a mess the people are making of their own condition.

Opined our Reckoner-in-Chief, Bill Bonner, on the topic last week in his essay “On Humanity’s Instinctual Need for Democracy”:

“Is it possible that democracy is just the flavor of the month…an evolutionary development, like all the forms of government that came before it? Is it possible that it succeeded in the 20th century because it was much better adapted to leeching out the wealth and complicity of the average man? It gave him a stake in the system – like getting some prisoners to guard each other, or bribing taxpayers to rat out their neighbors to the IRS? Isn’t it possible that by giving the masses a ‘voice,’ the elites who really control government are better able to take his money…and, if necessary, his life?

“Soldiers will do their duty to a dictator, if the price is right,” continued Bill. “They will do their duty to the government they helped elect for less. And they will more willingly submit to government’s taxes, too, if they feel they are its masters, rather than the slaves. The real difference may only be an illusion, but it is an effective one. In practice, the individual may have less ability to influence the large pool of voting numbskulls than he does to influence a single knuckleheaded autocrat. But heck, we’re all democrats now.”

…for better or worse, we would dare to add.

And this brings us to the current situation here in America today. The individual states, having voted for themselves unsustainable welfare systems and exorbitantly expensive public services, are broke. From the essay “Budget Deficits, Pension Plans and the Seeds of Rebellion” in The Daily Reckoning Weekend Edition:

“States from coast to coast are facing budget shortfalls of a magnitude heretofore unseen, unfathomable, even. More than 40 states are in the red for a combined budget shortfall of $125 billion for fiscal year 2012. California is the worst, with a $25.4 billion hole to fill, more than seven times Wisconsin’s gap. Illinois comes in next with a $15 billion shortfall, followed by Texas with $13.4 billion, New Jersey at $10.5 billion and New York at $9 billion.”

Voters have only themselves to blame. But here at The Daily Reckoning, we like to look on the bright side of life. We celebrate the collapse of governmental incompetence at any and all levels, whether in this country or abroad. And with each passing day, and with each meddlesome, cumbersome, costly bill that is passed, we draw one step closer to that denouement.

In fact, so impressed are we with state government incompetence that we’ve decided to honor it in this year’s Daily Reckoning Financial Darwin Awards. Simply put, we asked readers to send in tales and anecdotes of government waste from their own states. Which state is most determinedly enacting bone-headed policies and business-quashing edicts, thereby ensuring their own eventual demise?

We’ll announce the “winning” state in this coming Weekend Edition, so there’s still time to submit your own boots-on-ground observations. For now, here are a couple of examples of what you’re up against…

Fellow Reckoner, Fred, had this to say from the heart of the Mid West revolt…

I was a Wisconsin Department of Transportation field construction engineer for 35 years. One spring in the ’80s I was starting a major road reconstruction project and doing survey out in the field with my staff. A massive county paint truck showed up to paint the traffic lane lines. I went over and told the foreman we would be ripping out the pavement and it would be a waste of money. He agreed but had to get the OK from his office. He called in but they told him it was too much work to cancel the work order. So, you guessed it, the road was striped. The very next day, we began removing two miles of pavement – but we did have a nice line to follow.

Along the same lines – a lesson in bureaucratic logic. In construction, all the materials going into a project must be documented as to source, material, manufacture, etc. However, some small, insignificant items did not require a formal report. So for these items we had a “Documentation Without Report” form – i.e., a report for things not requiring a report.

And this, from a Fellow Reckoner in California, a state leading the charge to bankruptcy with a $25.4 billion budget shortfall…

Perhaps this job announcement for the California Corrections Department [could be considered for your Financial Darwin Award Series]:

Recreation Therapist, Correctional Facility:

Starting Salary: $5,679/month

Description: A new job listing this month in San Diego, CA provides this $70,000 a year position description: A recreation therapist, correctional facility, encourages…individual and group activities such as indoor and outdoor games and sports, dance, parties, dramatics, and special interest clubs; Supervises entertainment and movies and assists in planning programs for special occasions.

I wonder if we are also paying for party favors and birthday hats.

Got something better? Send us your tales of government waste to right here.

Joel Bowman
for The Daily Reckoning