Whether you call it a shutdown, slowdown, or just a plain old government letdown, the deadline has come and gone for the federal government to agree on an appropriations bill. Not surprisingly, it hasn’t been all it was talked up to be. Not much has changed. The federal government is still conducting wars and flying drones, killing innocent people in the process. It is still spying on everyone and anyone. It’s still actively forbidding people from coming here in the hopes of making a better life for themselves, harming all of humanity as a result.
Things were supposed to shut down, right? What were they? Some websites such as nasa.gov have been taken offline completely, others like ftc.gov allow users to see a glimpse of the page before being quickly redirected to a page notifying them that it’s down, while still others simply have a banner on the top alerting users that the page hasn’t been updated since the shutdown. How is all of this determined? It’s not very clear. A memorandum by the Office of Management and Budget states that the services should be shut down even if the costs of shutdown exceed the cost of maintaining the services. This is indeed a strange stance to take, given that it’s coming from the office that manages budgets, and that the reason why things are being shut down is a monetary factor.
The Lincoln Memorial and others were closed off, only to be re-opened solely for “first amendment activities.” The NSA review group with deep ties to the government was deemed inessential after originally being scheduled to remain running (so much for governments being created to protect the rights of the people). And what about the exclusive congressional gym? Essential.
Regarding calculated effects to the economy, we should be very careful. As Frédéric Bastiat explains through the parable of the broken window, just because money wasn’t used in some capacity, doesn’t mean that it is now gone. In fact, it may have instead been used in a different and altogether more productive endeavor.
Another example of opportunity cost comes from looking at the furloughed government employees. Undoubtedly, they are taking the brunt of the immediate and visible hit. However, politicians should refrain from calls to get something done simply so that the furloughed employees can return to their jobs. The employees are not the rationale for their own jobs. The services that they provide to society should be the criteria through which it’s determined whether they should have a job or not. Of course, it’s difficult to figure that out due to the lack of proper feedback loops like those in markets. However, if after so many days and no significant adverse effects, maybe society and the furloughed employees would be better off if they tried something different, pursued their passions, or explored the world.
Now the federal government is running up against the debt ceiling. To repeat from our last post, although closely related, this is distinct from defaulting on the debt. Different Wall Street economists and the Bipartisan Policy Center have slotted the true date where the government will not be able to pay in full and on time somewhere between October 22 and November 1.[1] There’s a little bit of time left. We’re not worried that the debt ceiling won’t be raised; what’s going on now is just a bunch of political game-playing. We’ll be pleasantly surprised if there are any non-trivial spending cuts included. We’re still holding out for some spending cuts that aren’t just to the projected future increases.
Peter Wilson
NU Libertarians, President
[1] http://business.time.com/2013/10/08/when-will-u-s-actually-hit-the-debt-ceiling/
