On Doing Nothing

January 22, 1962

So all those who say that there’s nothing left to be done, that we should rest on our laurels, that the function of the national . . . government is to sit and lie at anchor are wholly wrong and we do not propose to follow their advice.”

President Kennedy at Columbus, Ohio, Jan. 6

Who are these people who say that there’s nothing left to be done? I have never met one. Are there people who actually believe that the 12,437,668 civilian employees on the Federal payroll should sit back and do nothing because there is nothing to do? Rightly or wrongly, the overwhelming majority of Americans have acquiesced with only minor reservations in the enormous proliferation of Federal programs and powers that has developed since the first and second world wars. A majority have in fact accepted the 2,133 different functioning agencies, bureaus, departments, and divisions found by the Hoover commission even in the Federal government of 1954.

Some Americans, confronting Federal expenditures of $89 billion in the current fiscal year and some $94 billion in the 1963 fiscal year, may look back wistfully to 1955, when such expenditures were “only” $64.5 billion. But no one dares to dream of a return to the $4.6 billion level of 1932, when candidate F.D. Roosevelt was demanding drastic economies.

WHO SHOULD DO IT?

Mr. Kennedy is, in fact, attributing an extreme laissez-faire and do-nothing philosophy not only to everybody who wants to cut back a little on some of the thousands of existing Federal programs, but to everybody who thinks maybe the Federal government is sufficiently overgrown and over expanded and ought to try to straighten out the messes in, say, foreign aid and farm subsidies, before taking on still more programs.

The assumption implicit in the President’s statements seems to be that if any “unfilled need” can be shown to exist anywhere, it is the duty of the Federal government to fill it; and if there is anything that ought to be done in any field, it is the Federal government that should do it. And so he wants it to pay the medical bills of the aged, or the tuition of needy college students, or to cure mental retardation, or to solve any other problem. It is because such assumptions have now become perennial that practically every new Congress enacts more than a thousand new laws.

Yet the truth is that the proliferation of new Federal programs, with their corresponding expenditures, does not on net balance meet new needs. Whatever the government gives to B it must take from A. It taxes Peter to subsidize Paul. It transfers part of the earnings of some people to other people. Instead of allowing those who have earned money to spend it on their own wants or needs, the bureaucrats seize the money to be spent more “wisely,” or on other people’s real or supposed wants or needs. The politicians may spend the tax money on real collective needs, or in the directions designed to influence the most votes.

THAT ‘PUBLIC’ SECTOR

The process has semantically come to be known as squeezing the “private” sector (by implication selfish) to expand the “public” sector (by implication benevolent). It would be more accurate to say that the government forces a relatively shrinking free-enterprise sector to subsidize an expanding socialized sector.

This constant expansion of the Federal government does much more than merely transfer income from one set of pockets to another. It abridges the liberties of the individual. It feeds the growth of bureaucracy. It reduces the incentives to production of those who earn money and reduces the incentives to self-help of those who get the increasing Federal aid.

The heavy personal income and corporate taxes soak up precisely the funds that would otherwise have been devoted to savings, to capital accumulation, to the creation of new equipment. The final effect, therefore, of increasing Federal programs and Federal spending must be the opposite of what Mr. Kennedy hopes for. Even if they do not bring on further inflation and imperil the dollar, they must tend to slow down the rate of economic growth, and the rate of increase in real wages and in standards of living.