For best investment in Minnesota, disinvest in government

In a MinnPost Community Voices commentary last week ("Regarding MN shortfalls: We can't go on like this"), authors Marcia Avner, Brian Rusche, Dane Smith and Ray Waldron managed to butcher both economics and the art of metaphor.
 
The philosopher Immanuel Kant observed that "our metaphors comprise the conceptual spectacles through which we view the world." The authors — who collectively formed the Invest in Minnesota Campaign — painted Minnesota as a state "suffering from a vitamin deficiency." We grow weaker and unhealthy; still, we resist a balanced diet. If only we would "think of taxes as spinach, broccoli and peas."
 
"Not exactly everybody's first choice on the buffet table," they wrote. "But the stuff we need to reinvigorate our state." It seems their appetite for tax dollars is insatiable.

I do agree with them on this point: We can't go on like this. We do need to invest in Minnesota, but contrary to their solution, the best way to invest in Minnesota is to disinvest in government.
 
"Minnesota's distinctive place as a high-quality place to live was achieved through innovation and private enterprise, to be sure," they acknowledge, but quickly add, "It also came through investment in human capital, education at the forefront, but also in essentials ranging from public-works infrastructure to caring for the elderly and poor, and amenities such as parks and libraries."
 
Private sector produces wealth
Were I individually as clever in use of metaphor as the four collectively, I might say, "They are putting the cart before the horse." Government does not produce wealth. It cannot do anything for anybody until it first takes something from someone else. Until someone in the private sector produces wealth, there is no money for public education, no money to build infrastructure. Before government expanded its domain, families took care of their elderly, churches and charities ministered to the poor, and private philanthropy built parks and libraries.
 
The authors lamented that a diminished Minnesota has "caused real pain to all but the most affluent of our citizens" and made the point that high-income earners "have benefited the most from deep income-tax cuts," and that "the same top-enders have a greater share of wealth and income than at any time in recent history."
 
That is not an economic argument. It is a moral argument — a flawed moral argument, but a moral argument nonetheless; the economic argument is more on point.
 
"The scrimping and corner-cutting ... is most assuredly NOT producing the general prosperity that was promised when tax cuts were enacted."

Importance of money flow, spending
An economist, unlike the moral polemist, will tell you that tax cuts alone do not produce prosperity, any more than tax increases do. Where and how money flows in the economy and where and how government spends tax dollars determines how much wealth is created and how it is distributed.

In the private sector, tax cuts have contributed to the production of wealth, which the authors acknowledge. They just don't like how it is distributed. It is that growth in wealth to which the four now lay moral claim in the name of "fairness" and the "common good."

Wealthy people do not bury their money in coffee cans in the backyard. They save and invest, providing the capital that fuels the economy. Other factors, not the least of which is government meddling, also affect prosperity. Investment capital alone is not sufficient to produce prosperity, but it is absolutely necessary.

And what has government done with its golden talents? It would have been better had it buried them beneath the Capitol lawn, but instead, government has to a large degree misspent them. Government has spent education dollars tinkering with a failing one-size-fits-all system. It has extended its reach well beyond its constitutional obligations. It has spent state dollars on pet projects rather than infrastructure maintenance.

So, by all means let's invest in Minnesota, but let's do it the right way by disinvesting in government. Let's invest in Minnesotans by letting them keep more of their own money and take more responsibility for their spending decisions on things like education and health care. Let's disinvest in government by limiting spending to its constitutional obligations. Spinach, broccoli and peas are side dishes, never meant to be the main course.

Craig Westover is a senior policy fellow with the Minnesota Free Market Institute. He contributes to MinnPost.com and to the Opinion page of the Pioneer Press. 

Want to add your voice?

If you're interested in joining the discussion by writing a Community Voices article, email Susan Albright at salbright [at] minnpost [dot] com.