TANSTAAFL


This article was originally published on American Thinker on Saturday, February 18, 2012.

No, TANSTAAFL isn’t a new type of Swedish meatball.  Nor is it the name of a solar powered sauna.  Robert A. Heinlein, the science fiction writer, created the acronym TANSTAAFL for his novel The Moon is a Harsh Mistress.  It stands for:

There Ain’t No Such Thing As A Free Lunch

Any person with even a modicum of intelligence can see how obvious that thought is.  Unfortunately our political leadership (from both parties) has made providing everyone a “Free Lunch” a standard campaign promise.

These promises are not always as obvious as “giving away” food stamps or extending the payroll tax holiday or promising 18 months of unemployment.  Nearly everyone can understand that the taxpayer is going to pay the tab for these types of things.  These are easy to spot, and although they are frequently difficult to end, or even reduce, they are at least easy to counter when politicians claim that they will increase these benefits and they’ll be free.

The larger problem is the tendency of politicians to promise that the taxpayer will not have to pay for these goodies, but instead someone else will — someone not too well-liked by the public in general will be paying the tab.  Someone like an insurance company.  Oil companies and banks are also a favorite target for politicians, as is almost any large company.

The voters are inevitably told that these people have lots of money and that it’s just unfair.  After all, they are told, the voters work hard for their money, but do these companies?  Of course not!  Money just magically appears in their bank accounts.  Or at least that’s what the subtext of campaign commercials and speeches leads the gullible to believe.

The brutal truth is that corporations, large or small, rarely lose a penny from governmentally mandated costs that are sold to the general public as a freebie.  Raising a company’s costs via these mandated wealth transfers results in only one thing — increased prices for the goods or services that these corporations provide to the same members of the public who voted for the free goodies.

Ultimately, the freebies that the government is telling us will be paid for by these evil, heartless, soulless corporations are in reality being funded every time we, the public, make an insurance premium payment (which itself has been artificially raised to compensate for “free” stuff that the insurer has to pay for) or buy a tank of gas, or make an interest payment on a mortgage.  The cost of these freebies is always passed along to the consumer.

Does anyone think that he is not paying for the medical benefits enjoyed by United Auto Workers (UAW) when they make their monthly auto payment?  Does anyone really believe, no matter what the president’s claims of an accommodation might be, that the Catholic Church actually won’t be paying for contraceptives and abortifacients for their employees?  Of course not.

This is the entire basis of the Liberal-Progressive-Democrat cries for “social justice,” “income equality,” and “redistribution of wealth.”  In its simplest form, they are planning to rob Peter to pay Paul, and in keeping with the old saw, when they do that, they will always have Paul’s support.

What must be done (beginning now and continuing right up to November’s election) is to explain to Paul that what he is getting is not “free.”  He, himself, is paying for what he just got “free.”  It might take a while for all the payments to be made, but of every purchase that he makes, some part of it ultimately goes to paying for what he just got thanks to the government “taking care of them.”

These mandates, or increases in taxes, all raise the cost of doing business.  They reduce the willingness of employers to hire more people.  They reduce the willingness of employers to spend money on new equipment, since those who manufacture the equipment are also paying for someone’s freebie, making new equipment even more expensive.  So the equipment manufacturers, too, suffer a drop in sales, and they, too, stop hiring.  The many smaller companies that provide components to the equipment manufacturer get fewer orders since their customer is losing sales.  They also cut back on hiring and may even start laying off workers.

It doesn’t take an economist with multiple doctoral degrees to see where this leads.  Higher selling prices because of higher costs that are due to government mandating certain “benefits” that are to be provided ultimately reduce sales.  Reduced consumer sales have a ripple effect throughout the entire production chain.  As the entire production chain contracts, new hiring is canceled and existing employees are furloughed.  The economy begins to slide back into recession.  And the contraction doesn’t impact only America.  With so much of our economy dependent on foreign trade, the whole world can expect to see an economic slump.

Carried to the extreme, it jumps right past recession and goes straight to depression.  And why?  Because someone promised that we would get something for free, and got our vote.  Conservative politicians must constantly remind people that there really ain’t no such thing as a free lunch.

About Jim Yardley

Retired after 30 years as a financial controller for a variety of manufacturing firms, a two-tour Vietnam veteran, and independent voter.
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