Marcus
Long ago, on a cold windy day, a youth came upon an elderly person hesitating to cross a busy ice-covered boulevard. “Might I have the pleasure of escorting you to the far side of this dangerous icy avenue?” asked the youth.
“Ah, indeed,” replied the senior with evident gratitude. When they reached the other side safely, they parted with appreciation for each other. How was the youth to know this elderly person was about to murder someone?
This tale may help us understand a major moral dilemma: how seemingly well-intentioned acts often serve undesirable consequences.
In 2008, a major portion of the financial sector of the United States was in danger of collapse due, in large measure, to its own ingenuity with investments in home mortgages. The federal government, with the participation of the Federal Reserve Bank, saved the day.
In the face of an unprecedented drought in financial markets, extraordinary quantities of money were flushed into the economy. As a result, most of us did not suffer from the disaster that could have been. Yet many did lose homes and/or jobs.
As we recovered slowly from this Great Recession, along came the Covid pandemic. With the sudden impact and terror of a tornado, millions were taken ill, many to die. To restart the economy and maintain basic commerce, again money was flushed into the system.
These were noble acts to aid a distressed nation. However, while Covid disrupted the entire economy, the 2008 crisis was mainly in the financial system.
The price paid for the repeated Covid-alleviation payments to households and businesses has been inflation. More money in the hands of families and firms, independent of their needs, released a flood of buying inconsistent with the ability of a changed economy to absorb.
Did we learn anything from this?
Not in Indiana.
Our legislature and governor gave back tax money to income taxpayers rather than putting dollars to work where productivity could be increased. Most notably, they failed to pay neglected teachers and pave neglected roads.
Those refunds were made in 2022. Isn’t 2022 the year in which all representatives in the House and half the Senators are up for election?
Not to be outdone, a unanimous council and mayor of Indianapolis will provide homeowners with symbolic property tax relief in 2023.
Isn’t 2023 coincidently the year when councilors and the mayor are up for election? Were there some other uses for those funds? A faster schedule for better street lighting? More attention to illegal gun sales? Sidewalks?
When the Indiana General Assembly reassembles, if there is any honor left in that collectivity? Might they reconsider their penchant for self-interest over the public interest? The same applies to our many local governments where the preservation of privilege precludes progress.
Morton Marcus is an economist. Follow him and John Guy on Who Gets What? wherever podcasts are available or at mortonjohn.libsyn.com. Send comments to [email protected].
