In these days it takes so much longer to wade through the mountain ranges of literature, the various voices clamouring for attention, the need to appease to many interest groups, and that there are now so many “economic entities”, be these commercial or government ones, that the cost of getting things done just keeps growing.

Much of this represents rent-seeking on a grand scale and is, I suspect, accurate. It’s all rather sad, when you think about it.

Once again apologies for failing to let people out of the spammer in a timely fashion; I’m on my own at present and not checking the blog as regularly as I’d like.

Perhaps it is all the “consultants” that are called onto committees? Or a gradual process of one upmanship – they said they’ll spend this much to fix the problem, we’ll spend more.

There might be a complexity issue here. In these days it takes so much longer to wade through the mountain ranges of literature, the various voices clamouring for attention, the need to appease to many interest groups, and that there are now so many “economic entities”, be these commercial or government ones, that the cost of getting things done just keeps growing.

Or it could simply be directly proportional to the amount of legislative issues that must now be addressed.

Sometimes, I feel like The Rapture has actually happened and I have been left behind. Australian public discourse is saturated with riffs such “the government bailed out KKKism”. men and women in their fifties and sixties many with Ph.Ds and few with blatant signs of madness really do believe this.

It did no such thing, as it creates/earns bugger all. What the magnaminous government did was use its monopoly on the legitimate use of violence to garnashee tens of billions of dollars from each and every Australian citizen and business.

The current deficits will not be repaid from amazingly profitable state-owned banks, auto companies, steel, agribusiness, etc. The money is either borrowed from private individuals and/or companies and repaid from the taxes of each of us and companies.

Yes, exactly.

There are many arguments for the decline of various virtues in the States since the middle of the century. These usually are convenient to the speaker’s ideology. I tend to thing that human beings spend their entire lives getting it together and then letting it go pear-shaped and back again.

Civilizations do this on a grander scale.

Something has happened to make us way less efficient at spending public money since then…

Are we really way more efficient? I just think that since the 1960s, the wealth creation machine that is western liberal civilisation has thrown up such an extraordinary orgy of money that way, way dwarves even the mammoth spending in this diagram.

I think (though I might be wrong) you would be one to agree with an objection I have to invocations of “public money”. To me, “public money” is money from the profit of “public” enterprise. That is, “public money” comes from state-owned enterprises. All the rest is private money borrowed. The current deficits will not be repaid from amazingly profitable state-owned banks, auto companies, steel, agribusiness, etc. The money is either borrowed from private individuals and/or companies and repaid from the taxes of each of us and companies.

Yes in the 40s and 50s Americans were well-educated, thrifty, hard-working and skeptical people.

Today they resemble what happens to porridge after hungry dogs have been at it

It is interesting how the Rapidly Disappearing GFC brought out all these pundit and bar-room historians claiming the great chnage you note was simply a consequence of de-throning the alleged reign of John Maynard Keynes!

Of course, the Shangri-La you describe was ‘achieved’ by requiring Jim Crow Laws, and all the other racial/ethnic/cultural sequestration. The collapse of those walls pimped via the laugh-track of multiculti has reaped a bitter harvest. Nevertheless, apart from John Quiggin, does any human being really want to return to the 1940s/50s/60s?

I’ve got a good mate who works in defence who points out that we actually still need quite a bit of the conventional military hardware, and that it’s possible to go over the top with the counter-insurgency model. I’ll see if I can get him to make a comment because I think it makes sense.

I agree with Tim too about ballooning wages playing a large role in this, coupled with the perception that the good times were never going to end. LE and I have discussed off-line that some jobs are simply not worth what we pay for them, and that the only reason we pay what we do is because there isn’t a true free market in labour. Now some economists do argue for a free (or at least freer) market in labour, although it is generally recognised that doing so would involve crashing the welfare state in those countries that have one (this includes wealth transfers, like free education and healthcare, not just direct transfers like welfare cheques).

When it comes to privatisation, I’m generally a fan — the state has its fingers in far too many pies, especially in the UK — however, I’m also of the view that where the evidence is in that the state works better (defence and the justice system, for example), then these bodies should be wholly state owned and managed. I’m therefore opposed to private prisons, and to much private military contracting.

These are core state competencies, and — as Hayek points out — they are things with a very specific outcome in mind, and when that’s the case, the state tends to do them better. In things like health and education, by contrast, the outcomes are determined by individuals, not the state, and the state is subject to insurmountable problems of information asymmetry in managing them (because it can never know what all those individuals prefer).

Of course, you get people trying to have the best of both worlds — like the Yanks with socialised medicine for the elderly and insurance companies never subjected to true market discipline for everyone else — but what you get is actually the worst of both worlds. The American system is both inefficient and expensive. The NHS is just inefficient — but until recently — hasn’t been very expensive. That it is becoming more expensive is a function of demography and lifestyle more than anything else.

Whoa, long comment… but the thread’s an interesting one.