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Archive for August 20th, 2012

When I was a kid, I was a big fan of Robin Hood. I remember reading at least two books recounting the legend and I watched the Errol Flynn version of the movie several times.

And, as an adult, I saw both the Kevin Costner and Russell Crowe versions of Robin Hood.

“I’m not an occupy-Wall-Street moocher”

None of this makes me an expert, but it does allow me to state with some confidence that Robin Hood was not a left-wing hero who stole from the rich and redistributed to the poor.

Instead, he was a quasi-libertarian tax protestor. Okay, maybe it’s an exaggeration to claim he was a libertarian, but Robin Hood was on the side of ordinary people who were being exploited by incessant tax demands from the ruling class. His main enemies were Prince John and the Sheriff on Nottingham, not the medieval equivalents of Wall Street.

In the Russell Crowe version of the movie, Robin Hood even gives a speech about the importance of liberty.

So you can imagine how irked I get when statists agitate for things such as the “Robin Hood Tax” in this moronic video. But what motivated me today is a story in the Financial Times about a Cesar Chavez wannabee politician from Spain.

For Spain’s ruling politicians he is a criminal; for his supporters he is Robin Hood, stealing from supermarkets and redistributing the food to the poor. Juan Manuel Sánchez Gordillo, the mayor of Marinaleda, a southern town with a population of 2,600, has been catapulted to cult hero status in Spain after setting out this week on an anti-austerity march across Andalucia – occupying banks and stealing food… “We are fighting a war for the poor … going to jail is not important for me, it would be an honour,” Mr Sánchez Gordillo told the Financial Times. “We are going to occupy all of the banks and supermarkets we are able to in Andalucia. The robbers who have caused this crisis must pay the consequences for what they have done.”

But if the Mayor really wants to make robbers pay, he should march straight to jail and turn himself in. Not for the empty publicity stunt of robbing grocery stores, but for being part of a political class that has dramatically increased the burden of government spending in Spain, from about 30 percent of GDP in 1980 to well over 40 percent today.

But don’t hold your breath waiting for self-awareness from this clown.

Not surprisingly, unions are part of the protest. I’m guessing that Mr. Canamero represents government employees.

On Friday, the marchers, who plan to sleep in the open or in parks, occupied a branch of Banco Santander in the town of Mancha Real in the province of Jaén before leaving later in the day. Diego Canamero, head of the Andalucian Workers Union, was in the branch on Friday. He said critics of the protests were politicians protecting their own interests. “These are symbolic actions against an unsustainable economic situation,” he said. “The bankers rob us, and take our money to tax havens…”

The dig against tax havens is particularly laughable. Ordinary Spaniards should hope and pray that their deposits in the local banks are safely re-deposited in banks based in well-run and honest jurisdictions such as Switzerland, the Cayman Islands, or Singapore.

And if they’re smart, they already cut out the middleman and directly placed their savings in one of these low-tax jurisdictions. That way, they’re not only at much less risk of a bank collapse, but they also have greater ability to protect their assets from the venal and incompetent tax-hungry political elite.

Returning to the mischaracterization of Robin Hood, this Payne cartoon does a good job of capturing my thoughts.

I especially like how Payne shows that the left-wing version of Robin Hood is all about a perniciously corrupt version of redistribution (though he should have included the Export-Import Bank on the side of the van). The genuine poor get crumbs while the well-connected interests make out like bandits.

P.S. Other good Payne cartoons can be seen here, here, herehereherehere, and here.

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Back in 2010, I posted a fascinating map from the Economist website, showing debt burdens (as a share of GDP) for nations around the world. This data showed lots of red ink, with Western Europe generally being more indebted than the United States.

In 2011, I posted some charts from a study by the Bank for International Settlements, revealing that the long-run fiscal outlook for the United States is worse than the outlook for European nations.

In other words, our politicians to date haven’t over-spent as much as their counterparts in Europe, but it appears that – if government is left on auto-pilot – America will suffer more from excessive government than European nations in the future.

Here’s some new evidence about the perilous long-term state of public finances in America. According to the Organization for Economic Cooperation and Development, the United States has to do more than almost every other nation to avoid becoming another Greece.

If this data is correct, the United States isn’t just in danger of becoming Greece. It’s actually in worse shape than Greece. Not just Greece, but every other European welfare state as well. That doesn’t bode well.

But time for some caveats. The OECD research mistakenly focuses on debt levels and what needs to happen to reduce red ink to a certain level. This isn’t a meaningless issue, but it puts the cart before the horse. What matters most is the size of government and the total burden of government spending – not whether it is financed with borrowing rather than taxes.

This doesn’t mean the long-run estimates are wrong. But if the focus is on the real problem of government spending, then it is much more apparent that the only feasible solution is to restrain the growth of government spending.

If the burden of government spending grows slower than the economy’s productive sector (i.e., Mitchell’s Golden Rule), then deficits and debt fall. To be blunt, if you cure the disease, the symptoms automatically disappear.

Which helps explain why I’m a fan of the Ryan budget, particularly his reforms to Medicare and Medicaid.

P.S. Regular readers know I’m not a fan of the OECD (for many reasons), but the economists at the Paris-based bureaucracy generally are competent at putting together good data. It goes without saying, of course, that this doesn’t justify raping taxpayers to subsidize economists.

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