A few days ago tornados and storms ripped through the southern states of our country. The latest that I’ve seen is that over 55 people lost their lives and many more were injured and lost property. While I normally support President Bush, I do not support everything he does. This is one of those cases.
In a press release, President Bush stated that the federal government would provide financial aid to these people. At first blush many people might say that is the right thing to do. However, let’s think it through and look at some unintended consequences.
Does the federal government do this for every family that loses lives and property? I don’t have anything to support this, but I feel certain they don’t. If not, why now? Just because of the size of the tragedy? Is this tragedy any worse for a family that lost loved ones or property in this storm than for a family that may have lost the same in a smaller storm that only affected that one family? How big does a tragedy need to be for the federal government to take responsibility for helping with restitution? 15 people? 20? 30? 50? Let’s say that any tragedy that takes 20 or more lives and/or $5 million of damage then the federal government will step in to help. Whatever number you set is arbitrary and unfair to those who suffer as much, but don’t have enough other people suffering with them. The number of people affected shouldn’t be the deciding factor.
The federal government doesn’t and shouldn’t come to the aid of every single person who has a catastrophe or bad luck. Our government would quickly go broke. But, I wonder if they should aid anyone?
How does insurance come into play? Let’s say that 10 families suffered equal losses, and that 5 of those families had insurance which covered (at least from a financial perspective) their losses. What happens when the government steps in to help those 5 families that did not have insurance? You then send exactly the wrong message to people.
First of all, you encourage those who didn’t have insurance to not get it in the future. After all, why pay good money for insurance if the government will cover you if you don’t have it? What kind of predicament will those folks be in if the next tragedy isn’t large enough in terms of total losses for them to qualify for federal aid?
What message does that send to their neighbors who sacrificed getting a new car or something because they paid their insurance premiums? Wouldn’t you be ticked off if for 15 years you paid the premiums on your insurance and then when a tornado blew up your house along with your neighbor’s you ended up having your insurance company pay for yours (after deductibles), and raise your rates, while your neighbor got a check from the Government? Wouldn’t some people be encouraged to drop their insurance and let the Government cover it next time?
Am I totally uncompassionate? Absolutely not! I feel bad for those families, and agree there should be some help for them. I just don’t believe the US Government should attempt to be the safety net for everybody. And I totally disagree with the arbitrariness of who they decide to help and who they don’t.
What this boils down to is responsibility. People need to step up and take responsibility for their own lives. Sadly, many people are simply the tail on the dog. They go through life allowing others to make important decisions that adversely affect their lives and then they complain about it. Or they don’t plan for emergencies and contingencies (financial and otherwise) in their families, and they expect the government or others to sweep in when there is a problem to fix it for them. Many have the mentality that they “deserve” help from someone.
So, in thinking this through myself, I wondered about the people who do all they can for their families—making sacrifices all along the way—and it isn’t enough. I’m still not convinced that the government should step in to help instead of churches and other charitable organizations, but let’s say that we accept the fact that they will. First of all, there must be some families that could have budgeted their money better and prepared for a tragedy, and some that did all they could, but it was not enough. How do you tell the differences when you decide to help those in need? The needs are immediate, so it would be too time consuming and expensive to screen those who you were going to help. Understanding that you were probably going to be giving money to some people who gamed the system, it may still be cheaper to pay out money to everyone than to go through the time and expense of identifying who really deserves it.
It seems to me that churches (that incorrectly assumes that everyone belongs to a church) or local governments would be closer to the people and could more easily identify who needed help. However, that also introduces the same level of arbitrariness that I mentioned before. Additionally, the local governments could easily play favorites and give more money to people who didn’t need it as long as they were friends or relatives.
Do you just say that all the waste and fraud is just a cost of doing business to help people in need? Or, is the ultimate solution to not have government, at any level, provide aid to people in trouble? I still tend to lean toward self-reliance and voluntary charity. (“Voluntary Charity” is actually redundant, but “Forced Charity” through taxes requires me to make this distinction.) In my mind, helping individuals (no matter how many are grouped together) should not be a role of the federal government.
Tuesday, February 12, 2008
Saturday, February 2, 2008
Allow People to Make Mistakes and Suffer the Consequences
Throughout life, people make mistakes. Some are small ones that have small consequences like putting salt in your coffee instead of sugar. Others are much greater, like getting an adjustable-rate mortgage to buy a house that you can barely afford. If people (and companies) are not allowed to suffer the consequences of the mistakes they make, they have no fear of making unwise decisions in the future.
Lately we hear the emotional arguments that too many people have been duped by greedy banks into getting loans for what now turns out to be more house than they can afford. Some people bet on the come--that housing prices would continue to rise and by the time their adjustable rate ended, their property would be worth so much more that they could sell it for a very nice profit. It worked for some people and for some it turned out badly.
I feel bad that so many people got into so much trouble. But, they took a risk and this time it didn't turn out. The people who got the loan, and the lending institutions are equally at fault (except in cases of lying--on either side), and now both sides are suffering the consequences of their bad decisions. But it is very wrong for the Government to try and bail people and companies out of this problem.
In most things in life, we come across the concept of risk versus reward. Most of the time, they correlate so that a little risk brings a little reward (on average) and a bigger risk has the potential for a bigger reward. The risk portion of the equation is extremely important! Without the consequences of risk, a person or company will continue to make bad decisions. There are some people who would like to spread those consequences out diluting them among a much greater number of people--the general population (through taxation).
This is wrong on several fronts. People who made mistakes end up not having to pay for the mistakes they made, so they are encouraged to make them over and over. Other people who weren't drawn into making the mistake this time see that there are no (or in some cases, reduced) consequences, so they are encouraged to give it a try. There are those who tried this before and failed, suffered the consequeces and now ask, "Where is my help?" Then there are those who didn't take a risk, but ended up paying for the mistakes of others though their taxes.
Did the people who made the poor loans make a smart decision? How about the people who took the loans? In the cases where the deal ended up in foreclosure or short-sell, you would have to say they didn't. What value do we have as a society by helping these people and companies avoid consequenses so they can go do it again? Are we not better off, in some respects, to let them fail and pay the price of failure? Either they learn how to do it better next time, or they don't get to play the game. By that I mean that a mortgage company should be allowed to go out of business if they are not smart in their business dealings, and a person who had their mortgage foreclosed on should not be able to get a mortgage leaving them to rent/lease.
It boils down to making people take responsibility for their actions. When we don't, at best people are not encouraged to learn how to make smarter decisions, but at worst we (society) encourage them to continue making bad decisions.
Lately we hear the emotional arguments that too many people have been duped by greedy banks into getting loans for what now turns out to be more house than they can afford. Some people bet on the come--that housing prices would continue to rise and by the time their adjustable rate ended, their property would be worth so much more that they could sell it for a very nice profit. It worked for some people and for some it turned out badly.
I feel bad that so many people got into so much trouble. But, they took a risk and this time it didn't turn out. The people who got the loan, and the lending institutions are equally at fault (except in cases of lying--on either side), and now both sides are suffering the consequences of their bad decisions. But it is very wrong for the Government to try and bail people and companies out of this problem.
In most things in life, we come across the concept of risk versus reward. Most of the time, they correlate so that a little risk brings a little reward (on average) and a bigger risk has the potential for a bigger reward. The risk portion of the equation is extremely important! Without the consequences of risk, a person or company will continue to make bad decisions. There are some people who would like to spread those consequences out diluting them among a much greater number of people--the general population (through taxation).
This is wrong on several fronts. People who made mistakes end up not having to pay for the mistakes they made, so they are encouraged to make them over and over. Other people who weren't drawn into making the mistake this time see that there are no (or in some cases, reduced) consequences, so they are encouraged to give it a try. There are those who tried this before and failed, suffered the consequeces and now ask, "Where is my help?" Then there are those who didn't take a risk, but ended up paying for the mistakes of others though their taxes.
Did the people who made the poor loans make a smart decision? How about the people who took the loans? In the cases where the deal ended up in foreclosure or short-sell, you would have to say they didn't. What value do we have as a society by helping these people and companies avoid consequenses so they can go do it again? Are we not better off, in some respects, to let them fail and pay the price of failure? Either they learn how to do it better next time, or they don't get to play the game. By that I mean that a mortgage company should be allowed to go out of business if they are not smart in their business dealings, and a person who had their mortgage foreclosed on should not be able to get a mortgage leaving them to rent/lease.
It boils down to making people take responsibility for their actions. When we don't, at best people are not encouraged to learn how to make smarter decisions, but at worst we (society) encourage them to continue making bad decisions.
Making Right Sense
I have a wide variety of interests that I like to read, think and write about: the economy, conservatism, capitalism, global warming, fitness, energy, positive thinking and other things. I'm not sure if my views are unpopular, or if "the other side" is just more vocal. I suspect that (to borrow a phrase) there is a "silent majority" of people that agree with many of my ideas. The purpose of this blog is to throw some things out there and see what comes back.
Knowing that I'm gullible causes me to be sceptical. I tend to understand and appeal to the logical argument more than the emotional, but I realize the power of an emotional argument, and understand that a strong emotional/weak logical argument will most of the time win out over the weak emotional/strong logical argument.
Most of my views are from a strong conservative viewpoint, leading me to select the name of this blog. I don't have any fantasy of being able to "convert" others to my way of thinking, but I've found that by reading and listening to other viewpoints and then expressing my own, I clarify my own ideas and values to myself. Many times after going through the arguments completely, I'll surprise myself and find myself agreeing with the opposing view. Changing one's values after critical thinking is not being wishy-washy as long as you admit to yourself and others that you have changed your opinion and can describe the reasons for it.
A local radio talk-show host likes to ask callers where they sit before they talk about where they stand. So here goes.
You already know that I'm a conservative. Much more so fiscally speaking, but socially as well.
I am a strong capitalist. I believe that, in most cases, Government should stay out of the way of business. I think that the creation of wealth is not evil, but is necessary for a healthy society.
I think that people who believe humans are the main cause of global warming are wrong. Most of that belief comes from the type of arguments (emotional) that are used by those who think "carbon footprint".
I'm in my mid 50's and I've gone from a very active lifestyle, to sedintary, and then back to active again. I've recently lost over 40 pounds through walking and a slight modification to my diet. I feel younger today than I did 5 years ago, and I'm wearing pant with waist sizes that I haven't worn in 30 years!
I am facinated by alternative energy--from an economical and self-sustaining perspective instead of one of "save-the-planet". I am most interested in energy usage, hydrogen, solar, and energy storage (batteries and ultra-capacitors).
Finally, I am a big advocate of positive thinking. I think too many of us "allow" things to happen to us, or allow ourselves to react to things in a certain way. I think we can change our future by visualizing how we would like it to be.
I don't think that I will be making daily entries into this blog. I have a fairly busy schedule and I like to stay active doing things. But occasionally, I'll read or hear something that really peaks my interest and I'll want to write about it to get a better understanding of it myself. You are welcome to comment on my thoughts, ideas and values.
Knowing that I'm gullible causes me to be sceptical. I tend to understand and appeal to the logical argument more than the emotional, but I realize the power of an emotional argument, and understand that a strong emotional/weak logical argument will most of the time win out over the weak emotional/strong logical argument.
Most of my views are from a strong conservative viewpoint, leading me to select the name of this blog. I don't have any fantasy of being able to "convert" others to my way of thinking, but I've found that by reading and listening to other viewpoints and then expressing my own, I clarify my own ideas and values to myself. Many times after going through the arguments completely, I'll surprise myself and find myself agreeing with the opposing view. Changing one's values after critical thinking is not being wishy-washy as long as you admit to yourself and others that you have changed your opinion and can describe the reasons for it.
A local radio talk-show host likes to ask callers where they sit before they talk about where they stand. So here goes.
You already know that I'm a conservative. Much more so fiscally speaking, but socially as well.
I am a strong capitalist. I believe that, in most cases, Government should stay out of the way of business. I think that the creation of wealth is not evil, but is necessary for a healthy society.
I think that people who believe humans are the main cause of global warming are wrong. Most of that belief comes from the type of arguments (emotional) that are used by those who think "carbon footprint".
I'm in my mid 50's and I've gone from a very active lifestyle, to sedintary, and then back to active again. I've recently lost over 40 pounds through walking and a slight modification to my diet. I feel younger today than I did 5 years ago, and I'm wearing pant with waist sizes that I haven't worn in 30 years!
I am facinated by alternative energy--from an economical and self-sustaining perspective instead of one of "save-the-planet". I am most interested in energy usage, hydrogen, solar, and energy storage (batteries and ultra-capacitors).
Finally, I am a big advocate of positive thinking. I think too many of us "allow" things to happen to us, or allow ourselves to react to things in a certain way. I think we can change our future by visualizing how we would like it to be.
I don't think that I will be making daily entries into this blog. I have a fairly busy schedule and I like to stay active doing things. But occasionally, I'll read or hear something that really peaks my interest and I'll want to write about it to get a better understanding of it myself. You are welcome to comment on my thoughts, ideas and values.
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