The Divine State in Action

by Gary DeMar

Obama and the Democrats want "more Americans to contribute today so that all Americans can do better tomorrow." I'm sorry, but I'm already contributing enough, taking into account federal, state, property, school, ad valorem, sales, social security, hotel, entertainment, airline, utility, gasoline, and dozens of other hidden taxes. Taxes on alcohol and cigarettes do not affect me directly since I do not smoke or drink. These taxes, however, still have a deleterious effect on the economy since money is power in the hands of the State. By the way, our health-care crisis is related more to poor health habits — smoking, drinking, and obesity — and bureaucratic regulations that drive up health costs.

Taxes are tacked on to everything. You've seen the signs posted on the rear of trucks: "This vehicle paid $3,642 in road taxes last year." No it didn't! You and I paid the taxes because they are tacked on to the commodities the trucks haul. Consider the gasoline tax. There was a time when the amount you and I paid in taxes was listed on the pump. Not anymore. Our entrenched government spenders don't want us to know how much tax we are really "contributing" at the pump.

The profit an oil company makes on a gallon of gasoline is minuscule compared to the amount of state and federal taxes on each gallon. The oil industry employs hundreds of thousands of people, takes all the risks, pays billions of dollars in taxes, and gets blamed for gouging the consumer for unfair "profits" and fuel shortages caused mostly by requirements for air-quality control additives transitioning from season to season. Government agencies, on the other hand, simply collect the checks for the taxes the gas stations collect from their customers. What a sweet deal.

Few people talk about the Grace Commission. J. Peter Grace was appointed by Ronald Reagan to head the Private Sector Survey on Cost Control. The Commission discovered that more than $424 billion could be cut out of the federal deficit simply by eliminating waste and inefficiency from the national bureaucracy. This assessment was made in 1984! If these cuts had been made, the personal income tax could have been eliminated along with the IRS. Now there's a happy thought.

Millions of Americans knows all of this. But they're not the problem. It's the people who pay nothing in federal and state taxes who want higher taxes for greedy rich bastards (the KJV uses "bastard" three times). This is why I cannot understand why any American taxpayer would want to contribute another penny in taxes to pay for these dependency-creating boondoggles. Any person who believes that higher taxes will get us out of this mess needs major brain surgery. Higher taxes have never produced an economic recovery. Taking money out of your paycheck and giving it to someone else does nothing but undercapitalize the productive. Your ability and freedom to spend, save, and invest your own money creates jobs and keeps interest rates low. In addition, and this is what elected officials hate, this allows you more personal freedom and independence.

Barack Obama is telling us that the government can do a better job spending our money. This is nonsense. Consider the following set of statistics from the Congressional Research Service of the Library of Congress of 16 years ago. We spent $226 billion a year on welfare programs, which included cash payments, food stamps, housing, and medical assistance for the poor. The Census Bureau reported that there were 30 million Americans living in poverty, which is defined as a family of four with income less than $13,942. By dividing $226 billion by 30 million people the result is $7,533 per person or $30,132 for a family of four.

Much of the money we pay in taxes is lost in the system itself. If that $226 billion had been returned to its rightful owners — the taxpayers — poverty would cease to exist. Jobs would be plentiful because that $226 billion would have been circulating in the economy creating the need for additional commodities and jobs. The truly poor — a relatively small percentage of the population who are made that way through welfare — could be helped by existing charities. Bear in mind that wealth transfer programs have a nasty habit of keeping people on welfare, perpetuating the system and creating a permanent underclass that is easily manipulated by politicians.

Subjects paid tribute so they would not be "ground under" by rulers who considered their own actions to be "benevolent." The lives of those who paid the tribute were ruined since the tyrant controlled how free a person was to make a living and create a future for himself and his family. He did this by minimizing a family's capital — let the people keep enough to exist, take enough to keep them dependent. Those who paid the tribute remained undercapitalized and necessarily dependent upon the State (1 Sam. 8; Luke 22:25; cf. Rom. 13:1–4). To refuse to pay tribute meant punishment (2 Kings 17:4). Those who imposed the tribute used the funds to expand their political power (2 Chron. 26:8), weaken the productivity of the people, and keep them dependent upon the ruler—forever. The State perverts the biblical ideal of servant and adopts the demonic reality of idolatry.

In the United States, federal tax policy illustrates the government's unconscious rush to be the god of its citizens. When a provision in the tax law permits the taxpayer to keep a portion of his money, the Internal Revenue Service calls this a "tax expenditure," or an "implicit government grant." This is not tax money that the state has collected and expended but money it allowed the citizen to keep by not taking it. In other words, any words, any money the citizen is permitted to keep is regarded as if the state had graciously given it to him. Everything we have is from the state, to which we owe gratitude. In fact, we are the property of the state, which therefore has the right to the fruit of our labor.[1]

The Obama administration believes that the State is designed to save. This belief is so pervasive that it colors every program proposed by Washington. Sadly, millions of Americans willingly accept the belief that government is the engine of change for all that is good in society. If history is any indicator, the faith is ill-placed. How many past political regimes that promised salvation instead brought tyranny and oppression? The absence of any exceptions proves the rule.

Many elderly Americans may point to the New Deal of FDR as an exception. This is fallacious reasoning. Too many people assume that there were only two alternatives in the 1930s — continued depression or government intervention. Few people realize that "the independent Federal Reserve System was to blame for the mistaken monetary policy that converted a recession into a catastrophic depression. . . . The depression was produced by a failure of government, not of private enterprise."

Herbert Hoover, a Republican, was voted out, and Franklin Delano Roosevelt, a Democrat, was voted in. Roosevelt "was a fresh face, exuding hope and optimism. . . . He promised if elected to cut waste in government and balance the budget, and berated Hoover for extravagance in government spending and for permitting government deficits to mount."[2] That's right. Hoover had already started the printing presses.

Obama's supporters point to FDR as an example of how successful benevolent government can be. He hopes to revive the fond memories of Roosevelt's policies, policies that were adopted from the earlier experience of Bismarck's Germany and Fabian Socialism in England.

There's a massive confusion at the core of our politics. Against all evidence, everyone expects government to guarantee economic growth and higher living standards. It can't. Even the New Deal failed to pull the nation out of the Depression. World War II did that by boosting factory production. But the expectation of government as economic miracle worker is deeply entrenched, and politicians pander to it. For the past three decades, presidents have used the language of economics to rationalize deficits and, in the process, reward their supporters.[3]

Wars, of course, are anomalies and should not be used as standards for economic policy. World War II, the Korean War, and Vietnam did much to hide the negative effects of government spending on the overall economy. The Cold War era kept the monetary engines roaring. Coupled with military spending, government social programs expanded beyond anything FDR could have imagined. Our nation, contrary to liberal social spenders, is not reaping the excesses of the Reagan-Bush years. We are reaping the whirlwind of the massive interventionism of the New Deal era. Reagan and, to a certain extent, Bush simply hoped to slow the steamroller effects of New Deal liberalism. Reagan was only partially successful. He did decrease the tax burden early in his first administration. The gains were lost, however, in his second term and nearly wiped out under the Bushes.

One of the most famous utopian novels is Edward Bellamy's widely read Looking Backward, 2000-1887, published in 1887. In this utopian fantasy a Rip Van Winkle character goes to sleep in the year 1887 and awakens in the year 2000 to discover a changed world. His twenty-first century companions explain to him how the utopia that astonishes him emerged in the 1930s from the hell of the 1880s. "That utopia involved the promise of security 'from cradle to grave' — the first use of the that phrase we have come across — as well as detailed government planning, including compulsory national service by all persons over an extended period."[4] Bellamy's fiction became much of the world's reality in twentieth-century communism. Bellamy believed that "human nature is naturally good and people are 'god-like in aspirations . . . with divinest impulses of tenderness and self-sacrifice.' Therefore, once external conditions are made acceptable, the Ten Commandments become 'well-nigh obsolete,' bringing us a 'second birth of the human race.'"[5] Bellamy managed to mix the perversions of communism, secularism, and New Age philosophy into one impossible world. It is horrifying to realize that this present administration is attempting a similar mix.

Endnotes:
[1] Herbert Schlossberg, Idols for Destruction: Christian Faith and Its Confrontation with American Society (Washington, DC: Regnery/Gateway, [1983] 1989), 187.
[2] Milton and Rose Friedman, Free to Choose (Harcourt Brace Jovanovich, 1980), 91, 94.
[3] Robert J. Samuelson, "Rhetoric Over Reality," Newsweek (March 1, 1993), 31.
[4] Friedman and Friedman, Free to Choose, 93.
[5] Schlossberg, Idols for Destruction, 190.