April 16, 2007
A Bad Combination/Quote Bleg

Here's a bad combination--more than half the population received government transfers while tax liability is concentrated.

From the Christian Science Monitor:

Slightly over half of all Americans – 52.6 percent – now receive significant income from government programs, according to an analysis by Gary Shilling, an economist in Springfield, N.J. That's up from 49.4 percent in 2000 and far above the 28.3 percent of Americans in 1950. If the trend continues, the percentage could rise within ten years to pass 55 percent, where it stood in 1980 on the eve of President's Reagan's move to scale back the size of government.

Meanwhile, Ari Fleischer writes in today's WSJ (sub req) that the top 1% of income earners pay 37% of total income taxes, the top 10% of income earners pay 71% of total income taxes, and the top 40% of income earners pay 99% of total income taxes.

There's a famous quote--not Batiat's "Government is the great fiction through which everybody endeavors to live at the expense of everybody else." but similar--about having a majority of people voting to receive benefits from a taxpaying minority. The quote escapes me--I've opened comments if any reader can think of it--but it seems prescient.

UPDATE: Here's the quote, albeit not quite as I remembered it:

A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largess from the public treasury. From that time on the majority always votes for the candidates promising the most benefits from the public treasury, with the results that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.

It's attributed to Sir Alex Fraser Tytler, but, as explained here, there is some dispute about the author. HT to Jon and Mark for offline comments.

Posted by E. Frank Stephenson at 04:47 PM in Economics

Comments

You might be thinking of another Bastiat quote, the precise words escape me, but it's something like, "A government which robs Peter to pay Paul can always depend on the support of Paul"

May not be exactly what you're looking for, but it was the first thing to come to mind...

Posted by: David Z at April 16, 2007 09:29 PM

oops - it turns out that quote is accredited to George Bernard Shaw, not Bastiat.

Posted by: David Z at April 16, 2007 09:36 PM

The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it. -Adam Smith

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