“Fashion is what seems beautiful now but looks ugly later; art can be ugly at first but it becomes beautiful later.” — Steve Jobs

We are in full electoral campaign time now and politicians are doing what they know best, give away “freebies.” Yes, career politicians are alike throughout time, there is nothing new under the sun.

Growing up in Puerto Rico I remember well how for three years politician’s best answer was “we have no money” only to see them spending truckloads of cash close to the election. Clear in my mind I remember the sudden re-paving of roads, the building of new basketball courts and even the outright gifts of food and home supplies such as wood and other home building materials. Whenever you went for a job to city hall the town’s mayor will say, “There is plenty of work but no money.”  Only till election time when summer and part-time jobs were in abundance. Dozens of teenagers would sit around pretending to work to collect a generous paycheck leading their parents to vote for the magnanimous giver.

Politicians know that what is seen immediately is what people remember better and that is what they hope to continue seeing after election time. The present Administration, as many others before it, knows this and now is the time to offer some banana republic free stuff. Student loans benefits are the first in a long line of eye-catching giveaways to come. In fact, a supposedly “do-nothing” Congress is the best gift our President may have to dress up as Santa and start “doing something.”

“But look, what is wrong with that?  I owe a lot of money in student loans and the economy is tough. Why not help now those who are suffering with some relief?” Yes, it is eye-catching and heartwarming that sells, as every scam does. On the other hand, being against such decisions appears as heartless and mean; the kind of things only those invested in helping only “the rich” would do. In politics, whenever you give away something you are good, compassionate, “in touch” with the people, and when you refuse you are staunch, ideological, “out of touch.” It works!

At election time, who cares if the individual burden of paying a debt is transferred to taxpayers?  Who looks at whether or not education is an area of life where the Federal Government ought to have no competence? At a time when most Americans tell us our country is going in the wrong direction and most people think Obama’s policies are not helping the economy, many will still vote for him if they see that there is something there “for them.” That is where collectivist ideas often end when the hope for true change fades: rabid individualism as people hoard as much as they can.

Thought-provoking is not as politically effective as heartwarming.

Here we should remember the simple wisdom of a profound economic thinker: Frederick Bastiat. In his book, That Which is Seen and that Which is Not Seen, he explains how economic hubris often hurts the very people receiving “benefits.” The act of offering a tangible benefit, he explains, produces an effect that is only one in a series of events. The one the politician is interested in is the immediate effect. Only the immediate effect has the enticing emotional power that takes most people to the ballot box. The effects that follow are not seen so, out of sight, out of mind. The good economist attempts to foresee coming events, the good politician does his best to look the other way.

The way immediate entitlements hurt us is by luring us into thinking there are no other effects to what cost something today when, in truth, what often is immediately gratifying becomes subsequently fatal. Why are politicians mystified at events that could have been foreseen, and often have been predicted by those who were earlier called naysayers, can be explained by examining the profound lure of immediacy.

Some decry the President’s loan forgiveness by pointing out to how small the gift is, saving debtors only ten dollars a month, but they are missing the point! As Bastiat explains, good economists are willing to accept a small present evil in pursuit of future greater goods, as they consider both immediate and future effects. Conversely, good politicians lust over small present goods even if these often produce future great evils. To eschew small immediate results in attention of future events necessary to foreseen  is political suicide; it is not heartwarming.

Bastiat is wise in reminding us that we learn both by experience and foresight. Experience is often merciless, as eventually we come see how devastating it was to go after the immediate and small benefit, unless the same politician lures us again with another benefit promising another immediate and tempting effect. The good economist will again recommend foresight and frugality and again will be dismissed as uncaring. No, the problem then was that we did not “invest” enough. And there we go again.

By now, I believe, some of you would have recognized me as a bad and uncaring commentator.

Advertisements