Today's political climate is an interesting variation on the boy's cry of "wolf" - both without wolf and with one. A cabal of politicians and media fellow travelers is currently shouting a great chorus of "danger and doom" from the housetops. "The sky is falling", the "wolf is at the door", we are all doomed - unless we follow them into an ill-defined future.
Our situation differs from the parable in that the cries of "wolf" we hear are not for someone's perverse amusement, but for political or economic gain. Not every alarm is false. There are troubling and even dangerous events and/or prospects, but not every warning is wholly true. Which is which? And what should we do (or not do)?
At the macro-level, two powerful messages of doom are being trumpeted. Both serve defined groups of self-interested adherents. The first of these is the global-warming/climate-change scare. Some politicians, businessmen and scientists have joined forces to preach that doom awaits - perhaps a century hence - unless we make wholesale changes in how we live. This would involve staggering costs, huge increases in government power, and possible impoverishment of millions.
No one can be sure if a climate-problem really exists, or if the measures proposed will make a difference. Alarmists say climate-change must be stopped - that we can't simply continue on as we are. We must do something. But many scientists point out that climate change has occurred, naturally, often in the past. They say the changes proposed would cost immensely and accomplish next to nothing except degrade our lives and increase government control.
If trillions are spent trying to prevent climate change, that money will go somewhere. It's not accidental that those shouting "doom" the loudest expect to profit. Dissident scientists call it the greatest swindle in history. Government money is already flowing. Last year the USA spent $4 billion studying climate-change. That's enough to furnish a $100K income to 40,000 people. And it's only the beginning.
The average American - ignorant of the scientific facts (or lack thereof) - isn't sure what should be done, if anything. He's a little worried, but he's wary of a "crisis" 100 years off that requires big taxes from him now. Americans tend to draw back when their pocketbooks are hit, but that's already happening with ethanol-mandates (pricey fuel giving poorer mileage) and blocked development of known oil reserves in the arctic and off our coasts. By the time we get alarmed about the climate-change freight-train, it might be going to fast to be stopped. Like the War on Poverty, it could take on a life of its own, whether effective or not.
The second great message of doom is that the American economy is in desperate trouble and can be saved only by the agents of "change" - i.e., primarily, the Democratic Party. Bill Clinton won on that story in 1992. He promptly rammed the largest tax-increase in history through the Democratic Congress, carrying the Senate by the vice president's vote, 51-50. The voters then tossed the Democratic Congress out and put Republicans in charge in 1994. In 2000 and 2004 they elected George Bush, who pushed historic tax reductions through in 2002-'03.
Politically speaking, that was all eons ago, so the "worst economy since the Great Depression" story might work again. But what is the truth about the economy? Experts say we have full-employment, and by every conventional measure the economy is strong and healthy. Our Gross Domestic Product is $14 trillion - far and away the highest in the world - and is increasing steadily. 70% of American families own their homes - highest level in the world.
The rich are certainly getting richer, but studies show that the poor are... getting richer, too. Our "poor" are the envy of the world's poor. Millions are trying - by fair means or foul - to get into the USA so they can work and build futures for their families. Nobody ever tried to break into jail. If it's really bad here, an awful lot of people "over there" don't know it.
Populists speak of "the poor" as though they are stuck in poverty with no way out. But data show that few people in the bottom quintile of income are still there five years later. A large part of the American Dream is upward mobility. A high fraction of the "poor" are single mothers - a social, rather than an economic problem. Even they tend to move upward.
The commonly accepted "conventional wisdom" of shrinking American manufacturing - long a staple of populist Democratic politics - has been shown to be false. Manufacturing output and sales are increasing, although there are fewer jobs - indicating increased productivity. (Usually this is considered a Good Thing.)
Notwithstanding all this good news, the stock market keeps going up and down by hundreds of points. The Dow Industrial Average was above 14,000 on October 9th, but today it's below 13,000. What's happening? And why do so many people "feel" pessimistic?
In truth, several disadvantageous things are happening that make people feel pessimistic. One is that historic barometer of good feeling, the price of gasoline. Last week the price of a barrel of oil on the world market hit $99 before falling to about $94 today. In Northern Virginia, where I live, regular gas is selling above $3 a gallon. It was higher in the fall of 2005, when Katrina hit oil rigs in the Gulf of Mexico, but today's prices are high enough to sting many consumers. You don't feel very optimistic when you're paying $60 to fill the tank of your pickup or SUV. Older people on fixed incomes feel even worse. (My first car cost only $20.)
Other economic issues nagging at voters like a toothache in the night are education and medical care. People of my generation got excellent educations from the public schools. Today, people who can afford private school tuition are fleeing those schools - including the children of public school teachers, government officials, and elected representatives (the same ones pouring public monies into the schools). Another million-plus children are being home-schooled by parents who have lost confidence in public education but can't afford private schools.
College costs are exploding at a rate far beyond general inflation. My generation went to college (often with full scholarships, if we had top grades), and came out with little debt. Some of us earned our way through. I owed $1,000 when I graduated in the mid-1960s. Today, 81 private college presidents are paid salaries above $500,000. A year at the private college I attended for $1,400 a year (room, board, tuition, everything) in the early ‘60s costs $28,000 today - a 2,000% increase. The college semester has decreased from 17 weeks in my time to 14 weeks today.
In my era, any kid with brains could get through college. Money could be found. Today, kids with little talent go to college because their families have the money, and poor kids who have talent pass it up. Parents who once saw a college education as the dream of a lifetime for their children are beginning to consider whether the investment is prudent.
Medical care and medical insurance also worry many Americans. A third-party payer system has insulated many people from the costs of their medical care, and a wildly uncontrolled tort system has driven up costs with lawsuits. Doctors and hospitals raise rates by double digits, annually, and insurance companies do the same.
People who retired before age 65 and thought they would be financially OK are shocked to see gigantic increases in medical insurance premiums - in some cases 50% a year. Government employees and retirees are nearly alone in being protected from high insurance premiums. No older person dares be without medical insurance for fear that an expensive illness might take his home and everything he has.
Large manufacturing companies that had promised low-cost medical insurance to employees and retirees are renegotiating those agreements so they can stay in business. All these things keep people awake at night and tend to drown out the good news about high employment, increased productivity and the booming GDP.
Other "wolves" are prowling about, however, without warnings being given or heeded. One is Islamic terrorism, which most Democratic presidential candidates treat as a non-issue. Their disregard of it is not surprising, for most of them know the public perceives them as weak on national defense. Mentioning the still-real threat of domestic terror would only draw attention to that perception. The strategy succeeds because Americans tend to forget about something that doesn't seem to be happening. Ironically, the Bush Administration's success in preventing another domestic terror incident plays into the opposition's hands. Democrats hope they can divert the voters long enough to grab the White House before another terror attack hits our soil.
Another wolf that should strike terror into our hearts is "unfunded liabilities" of entitlements. Little is heard about this looming monster. (Hillary Clinton has said publicly that she sees no problem.) Medicare alone has an unfunded liability of some $36 trillion - nearly thrice the nation's GDP. Taxes cannot possibly be raised enough to fund the program in its present form.
Social Security's unfunded liability is $25 trillion. It will start drawing down its "trust fund" - now consisting only of billions in government bonds - around 2018, and will exhaust the fund by 2040. Thereafter, taxes will have to be raised to pay promised benefits, or those benefits will have to be cut. Mr. Bush tried to do something to put Social Security on a sounder financial footing in 2005, but Democrats fought him to a standstill on it.
Political considerations are suppressing the warnings that ought to be sounded on these two very dangerous "wolves". When they start huffing and puffing to blow the house down, voters will raise an almighty stink about warnings that weren't sounded. And a new generation of leaders will arise promising "change". Only an educated, informed electorate can prevent endless repetitions of this charade. Now would be a good time to start that prevention.