We’re rich! That is what some are thinking as they eye the $14.3 billion in “new” money the Texas Legislature has at its disposal. Of course, a substantial amount of that money is already promised for property tax relief, but that will not keep big spenders from proposing new and expanded programs.
The chief argument for new spending is always the desire to “meet people’s needs.” As good as this might sound, it is a strategy often doomed to failure.
A few years ago, an Austin columnist recorded the story of an alcoholic panhandler taken off the street by a small businessman. Given a job for which it turned out he had a talent, this once-homeless man got his own apartment. It looked as if he would make a home for himself, but one day, he quit his job because the businessman would not give him a raise ahead of his gaining a certified rating in his profession. The man became a homeless alcoholic again – and died a short time later.
Why did this man, who seemed to finally have everything going for him, give it up for so trivial a reason? Although we may never fully understand this man’s actions, we can be certain of one thing: he knew his basic human needs would be satisfied once he quit his job.
Men and women stand on street corners in the heat, cold, and rain because there is a payoff. People give them money. Unfortunately, those who give the money and feel good about it are classic enablers. Their simple rule is: see a panhandler with a sign, give them money. Good intentions trump the reality that a destructive cycle is perpetuated.
Government is like that. Despite the complicated applications and bureaucratic hoops, the one over-arching rule in government is simple. If certain criteria are met – often a result of people making poor choices in their lives – those who apply for aid, get the aid. Government becomes an enabler.
The contrast between the businessman who attempted to help rehabilitate the homeless man, and people who hand over money at street corners, is mirrored in private charities and government social programs. The businessman’s efforts were undermined by well-intentioned enablers whose actions caused an alcoholic to believe he would not fully face the consequences of his own actions. Instead, this led to the alcoholic’s early demise.
Private charities like Goodwill and the Salvation Army take the time to understand peoples’ needs. They also have the ability – and the right – to customize their services to peoples’ real needs, and to deny help to the recalcitrant. That is the advantage private charities have over government. It does not take an act of Congress or any elected body to change a private charity’s rule when it discovers that the rule rewards bad behavior.
Government can never be like private charity. Government cannot truly care or be compassionate. All government can do is redistribute wealth. Private charities focus scarce resources on where the potential payoff is greatest – on those most willing to change. Government must follow simple rules that protect those unwilling to change from the consequences of their own actions.
There are a myriad of ways to spend $14.3 billion, all of which sound good to somebody. We need to consider, however, whether our money is being spent well or if we are employing a people in government to work a lot but accomplish very little. Because Americans are a generous people, there is no doubt that if the unobligated portion of the $14.3 billion surplus were returned to taxpayers in the form of reduced taxes, Texans would do great things with it.
So the choice is stark: grow state government programs through coercive taxation by letting government spend our money, or get our money back and determine its fate ourselves. The former obligates taxpayers far into the future, limiting their ability to personally bring positive change to their communities. The latter releases the generosity and creativity of millions. Neither path is likely to completely eliminate human misery, but private action has demonstrated an ability to subtract from it while government action has a tragic tendency to add to it.
Byron Schlomach, Ph.D. is the chief economist with the Texas Public Policy Foundation, an Austin-based research institute. He may be reached at email@example.com.