IREF - Institute for Research in Economic and Fiscal issues
Fiscal competition and economic freedom
This article appeared in The Wall Street Journal on February 24, 2010
In the 20th century, we often heard the maxim, "the war is the health of the state." In the 21st, fear has become the health of the state. We are encouraged to fear all manner of things—for our finances, for our health, for the planet. But the solution—more power to the state—is always the same.
While the 20th century has not yet healed the wounds of its deadly ideologies, the 21st century is inventing great fears to justify new kinds of totalitarianism. From global warming to H1N1 influenza, these great fears are used by the new ideologists to call on the state. And unscrupulous governments are pleased to take advantage of them, eager to increase their power and justify new legal straitjackets and new claims on private assets. After the final fall of communism, the ideologists, who can no longer decently refer to Marx and his epigones as models for a new world order, have imagined new ways of subjecting peoples to a pensée unique and an exclusive and dominating power.
Ecologists, on behalf of global warming, are doing their best to mobilize a global power capable of imposing on society as a whole a return to the age of the caveman—and a caveman without fire, no less. Modern deforestation, after all, traces its roots to that first man-made flame. They have already managed to make light bulbs shine less brightly and to make us liable for new taxes on our "carbon." Soon, perhaps, they will try to prevent us from eating beef, or having children—both carbon-intensive activities.
The politicians who, amid the cacophony in Copenhagen, have contributed toward this assault on human progress were probably not always aware of the danger of their attitude. Sometimes they consider themselves liberals, only deciding to use force against certain members of the community to prevent them from harming others, in the spirit of John Stuart Mill. French President Nicolas Sarkozy, in pushing for a national carbon tax, can argue that he is constrained by the "precautionary principle," which his predecessor wrote into France’s constitution. But the premise for such a tax is wrong. The warming it refers to has not yet been proven and the link with human activity is becoming increasingly hard to believe in the opinion of a significant portion of the scientific world.
Next, take swine flu. In the name of a possible but entirely hypothetical pandemic, the French government assumed the exclusive right to vaccinate the population against the announced flood of H1N1 flu—as though the state alone could control such a scourge, as though the doctors had suddenly lost all ability.
Some four million French people, made to worry by a frenzied campaign in the media, had to queue up in administrative centers as efficient as the Soviet administration at the height of its splendor. Even when the necessary doctors were present, which was not always the case, there were often no nurses to assist. In some cases, the shots could not be administered because the fire brigade—yes, the fire brigade was needed too, given the serious nature of the event—or even the keys to the premises could not be located.
The government wanted to act alone and manage this elusive phenomenon on its own, and of course it did it badly and to the detriment of the trust patients naturally have in their doctors. And it was all done at our expense, by levying a new tax on mutual insurance companies to the tune of 0.77% of their revenues.
Lastly, in the name of the financial crisis, national governments hastened to claim that they alone could save the world from the end of the world. It soon had to be admitted that the world managed to continue largely as before in the face of the crisis. Now we are told, even so, that if it survives, perhaps a little worse off than before, it will be thanks to additional supervision from a number of state institutions whose chief competence lies in interfering in the ordinary operations of private businesses. The crisis already accounts for new taxes on banks and bankers’ bonuses and constraints on companies. Going forward, these government interventions offer us the prospect of inflation together with and a global rise in tax levels to pay for all this "help" we are receiving.
These great fears are all pretexts for more government and less freedom. They are the instruments of those who, frustrated by the failure of socialism, are trying to revive it in a different way.
These new ideologists use the same methods as their old masters, whom they won over to their cause in the name of the fight against poverty and inequality. Could history repeat itself? The collectivism and state control that are preached to us today could take us back a few years, and lead the world to that Soviet model that Jean-Paul Sartre used to hold up as an example and whose horrors have already and too quickly been forgotten. So let us dissuade our contemporaries from listening to the fear mongers. Let’s use our freedom to save the world.