February 12, 2016
David Brooks used his column today to tell readers how Bernie Sanders’ programs would destroy the dynamism of the U.S. economy. I don’t have time to go through the whole story, but it is important to make one point.
Brooks complains that Sanders’ agenda would raise total spending at all levels of government from the current 36.0 percent to 47.5 percent. He argues this would require higher taxes on most people thereby depriving them of the freedom to spend their own money as they see fit.
It is worth noting that the bulk of this increased spending would be due to his health care program, which would make the government responsible for the overwhelming majority of health care costs. Clearly some of this additional cost would have to come out of the pockets of ordinary (i.e. non-rich) people, but it would be more than offset in most cases by reduced payments for insurance and out-of-pocket health care spending. In many cases, this would simply mean that the premium that a worker’s employer is now paying to an insurance company would instead go the government. It’s not clear that many people would see this as a loss of economic freedom.
The other point worth noting is that when Brooks lists the U.S. companies that have been dynamos of innovation, the first company on the list is Bell Labs. While Bell Labs was indeed a dynamo of innovation, it was the result of a government regulated monopoly (AT&T). This may not be a good example to support his argument that a large government will stifle innovation.
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