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Hopeless government

20. 7. 2010 / Stanislav Křeček

Perhaps people haven't realized it yet: everyone is certainly ready to the so much repeated "saving", everybody is willing to moderate spending, if that's what is needed for a better future or if "at least our children will get a better future than ourselves". This administration doesn't promise anything like that. The "savings", which the government intends to shower us with, will not be just a temporary part of the way the role of the State, it will actually be the way things will be permanently.

Or have you heard from our government members something different? Maternity incentives to be trimmed. Will they be brought back later, though, once our finances get better? What about the fees paid for health assistance? Will we abolish them once better times arrive? Will these measures lead us to a time when people will be able to work smaller shifts and deservedly have more time to rest? Far from it, we will actually work more and more and longer hours! Does hard work lead to a continuing growth of our quality of life? Nay, that what you save here on your social security, there on I don't know what, you will not get back later!

The text from the International Covenant on Economic, Social and Cultural Rights (of which the Czech Republic is a signatory), a key document, acknowledges the right of "(...) every individual (...) to a constant improvement of their life conditions" We are in the start of a track that leads to the opposite direction of that and we thus will have to get used to that, once again. And cheerfully so. Or, as not long ago said the Czech National Bank Chief M. Singer about our German neighbors: "(...) they were not that unhappy, not even when they drove their Trabants to the Baltics". A today's Minister of Culture J. Basser has complained on TV, not long ago, that even 20 years after the Velvet Revolution our people are badly mannered and pretentious, some retired people even want to have mobile phones! In response to the lady interviewer's observation that perhaps even lonely senior citizens sometimes need mobile phones to call for help, the minister replied that in other times old people didn't have cell phones and survived".

The latest events only confirm it: we are hearing that the crisis is supposedly already ending, stock prices are going up and as a consequence, of course, even prices will increase. However, oddly enough, the "savings", the lowering of salaries and the containment of public spending, which should have prevented the crisis from happening, will not end!

That state of things of course hasn't fallen from the skies and we are not talking about just a transitory crisis, as some may believe.

The contradiction between the fact that our current modern society will not be able to avoid massive State spendings, and considering that this constant increase in public expenses is impossible to be financed by creating more debt, the current capitalist regime is not able to solve it.

State spendings were for a long time low, not surpassing 5 to 8 percent of the GDP. During the Austrian Empire days, even income taxes were about 5 percent; the State basically didn't need massive funds. But the State took little care about social politics, rather leaving that burden on the shoulders of the municipalities, employers and wealthy donors, just as they did with the care of monuments or churches. Other than to soldiers, the Habsburgs didn't pay retirement pensions to anyone else. The Church was in charge of birth registrations and postal services were, for a long time, in private hands...

To ask money for the government just because one produced or cultivated something never came to anyone's mind. After the end of the First World War the situation changed radically. As Italian economic historian C. M. Cipolla has recently informed, in the 1920s and 30s the State spendings were about 20 to 30 percent of the GDP, in the 1970s 50 percent and nowadays much more. Of course this is not because of our politicians being incompetent , as a lot of people, even economists, try to convince us.

How to take care of so many things with public funds: the poor, the socially weak, those who can't pay "market" prices for whatever, about the level of water supplies when a dry season passes by, about the artistic expressions that are not "profitable" and can't support itself, the environment, to which nobody else gives a dime. Bravely try to give money to those who cultivate something, and to others to not cultivate anything! Democracy is not cheap...

And then, of course, with limited funds and also with limited government power, also the well functioning of the justice system, of which the State is the guarantor. The rich and the powerful don't need too many laws.

Massive taxation of high incomes is possible, but probably not very effective. Decreasing lower civil servant incomes and at the same time cutting public spendings will not be possible without destroying the "Social Deal". People will not like it, once they will understand what the whole thing is really about.

The actual changes necessary should be much more fundamental. The way out from the current laissez-faire capitalism towards a compassionate and fair society arrangement has already started (Sarkozy: "the concept of an all-powerful market, which is always right, has come to an end..."), but it will still take a while. The Left, which will present itself just as the ones who would also be conservative with public funds, but would apply the the "necessary" measures in a more humanistic and less "painful" way, will be laughed at.

A Social Democratic party that will present itself, like ODS (perhaps even TOP 09), as the same party, just that with a "human face", nobody will vote for... The author is a member of parliament for the Social Democratic party (ČSSD) and is the president of the Czech Association of Tenants.

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