As the federal Fiscal Year 2005 approaches completion and the 2006 budget takes shape, the lack of fiscal discipline of the George W. Bush presidency continues to enlarge upon the “politics of joy,” which have characterized the Republican Party since the end of World War II.  No longer aspiring to be the party of frugality and responsibility that “takes away the punch bowl” from the Democrats, the Republicans have become big welfare spenders whose largesse is financed by big deficits that are doubled by unaffordable tax cuts supported by the Fed’s excessive creation of money.

The change of roles of the parties has not been confined to the domestic scene, as the Republicans have become the borderless internationalists who welcome hordes of illegal immigrants, promote foreign trade without reciprocity, and engage in ill-advised military interventions at the behest of multinational corporations and neoconservatives attempting to build the New World Order.  The national interest has no place on their political agenda, and the party no longer has room for conservatives or nationalists.  This agenda should not come as a surprise to anyone who has taken the trouble to follow the evolution of the Republican Party since William Howard Taft and Theodore Roosevelt.  As “Progressives,” they launched the shift from continental to international imperialism and big central (socialist) government financed by limitless income taxation.  The Republican veneer of conservatism has long been the sham necessary to dupe the majority of their gullible supporters.

It follows, then, that the 2006 federal budget will be the first to reach $2.5 trillion, paced by Bush’s record share of GDP spent on social welfare and financed by excessive boom-time money creation.  The only real attempt at frugality that can be seen in this budget is its  failure to fund the Iraq and Afghanistan wars with sufficient manpower and material to win the peace, which suggests that Bush and his hawks may be as dubious about the possibility of achieving peace in these regions as the public is.

The massive scale of government in the United States is only partially revealed by federal spending.  The one fifth of GDP currently spent at the federal level is joined by an additional tenth taxed at state and local levels, raising total spending on government to three tenths of GDP.  Since 15 percent of federal outlays is spent on grants to the states, state and local spending on government amounts to nearly half of total U.S. government spending.  The increasing encroachment of state and local government on personal and property rights is a natural consequence, in addition to the benevolent interventions of our federal “Big Brother.”

At the beginning of the 20th century, it took less than one tenth of U.S. economic output to pay for all levels of government—federal, state, and local.  Historically, only the early Athenian democracy and the Roman republic—both of which were governments based on property-holding citizen-soldiers—enjoyed such limited government.  The Greeks, Romans, and Americans went from citizens to subjects as ownership of property and the powers of government were consolidated and centralized, resulting in freemen being driven to the city for welfare or conscription as soldiers and workers, or remaining on the land as tenants.  The government and the propertied elite progressively captured the bulk of the economic surplus.

What prospects lie ahead for Americans who are being increasingly consumed by the appetites of their own government?  No one disagrees with the forecasts anticipating the doubling of the scale of welfare spending on Social Security and Medicare to care for the aged, in addition to the expansion of Medicaid, welfare entitlements, and tax credits to support a growing underclass.  Government will enlarge to meet these needs, and so will the burden on the shrinking proportion of the productive who are forced to support the increasing proportion of the unproductive.

The federal budgets offered thus far by George W. Bush only exacerbate the problems Americans face.  The current welfare system encourages dependency instead of personal and family responsibility.  But the possibility of reforms such as those proposed for Social Security have sizable transition costs that would add to the huge federal deficits caused by excessive spending and unwarranted taxes that serve no useful purpose.  In effect, fiscal improvidence stands in the way of serious tax reform and Social Security reform.  Worse still, the relentless increase in the share of the economy that is being spent on the welfare state replaces the family, by contributing to the decline in marriage rates and birthrates (particularly legitimate births) and separates the aged from the family and from participation in the rearing of children, which reduces the ratio of workers to dependents.

These social and cultural phenomena are the degenerative effects of the uncontrolled welfare state, which we are witnessing throughout the developed world.  The two trillion dollars of deficits over the coming decade will be President Bush’s contribution to the current national debt, as will the tens of trillions of dollars of unfunding liabilities of Social Security and medical care for the aged and the improvident.  As a career politician, George W. Bush has been driven by a burning desire to be loved by the American public.  But the financial mess that will be his legacy will hardly be lovable.  The longer we imbibe at the party, the worse will be the morning after.