The Nanny State and the Red Queen's Race

"Well, in our country," said Alice, still panting a little, "you'd generally get to somewhere else — if you run very fast for a long time, as we've been doing."

"A slow sort of country!" said the Queen. "Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!"

As the West has become more prosperous than ever, the citizens of the West nevertheless find themselves with less purchasing power and less economic independence than ever before. The Western world ran a long race into industrialization and past it into the information age only to find that the jobs are vanishing and the cost of living is constantly growing. The race at some point became the red queen's race and her country is the strange wonderland in which we like Alice find ourselves.

Why then do we find ourselves running the Red Queen's Race, running twice as fast just to stay in place? When individual and business prosperity began to feed the size of the government, like any parasitic organism government exploded in size by feeding off the top and the bottom, taxing businesses and families at every turn to support a growing bureaucracy. Expanding government can never solve a country's economic problems when the size of government itself is the problem and solutions that involve the growth of government and the creation of new accretions of bureaucracy to implement the solutions only take more off the top. Each layer of government generates regulations and more demand for tax revenues, which in turn sucks wealth out of the economy and places a further strain on individual workers and businesses. Expanding the size of a parasitic organism can never relieve the problems of the host.

As workers find themselves with less purchasing power, they also find themselves with more to buy, courtesy of products produced by cheap labor abroad. Two income families become the norm, women focus on careers and as delayed adolescence extends into the twenties and even thirties for graduate students, reproduction becomes less of a priority. While reproduction becomes more expensive and more likely to be delayed for the native working class, middle and upper class, it is quite affordable for those dependent on social services insuring that immigrant birth rates will continue to outnumber the birth rates of the native population. The result has been a sizable drop in birth rates in even traditionally fertile Catholic countries such as Ireland and Italy, followed by a wave of immigrants as countries struggle to compensate for the birth rate gap that they themselves have helped to cause

Western countries are importing large numbers of immigrants to provide cheap labor for companies in order to prevent them from moving their factories outside the country. Politicians everywhere, including conservative leaders, such as Bush and Sarkozy, close their eyes to illegal immigration or outrightly seek to legalize it. This is of course another symptom of the Red Queen's Race, because once the illegal immigrants are legalized, they must be paid a legal wage and their benefits must be taken care of, at which point the companies must again replace them with illegal immigrants or outsource the labor. The faster the immigrant race is run, the more the country falls behind.

Once legalized the immigrants become an even heavier drain on the social services system, which itself becomes a heavier drain on taxpayers and necessitates two income families which helps lower the birth rate. The tax burden requires raising the minimum wage which creates a further burden on companies which in turn encourages them to hire illegal immigrants or move their factories overseas. Rather than decreasing the tax burden itself, governments provide tax breaks to companies at the cost of taxpayers, adding corporate welfare on top of an already overburdened tax base. Such incentives are however no solution and time and time again, as in the recent case of the Nokia factory in Germany, companies slurp up the tax breaks and then leave the country for someplace cheaper anyway. Turning entire regions into economic and even political unions such as EU and NAFTA only accelerates the drift of industries into cheaper and underdeveloped areas, as in the case of the Nokia factory, often funded by the economic unions themselves.

As taxes and regulations raise the cost of doing business, businesses naturally turn to illegal immigration and move their companies overseas. Governments then try to placate both businesses and workers with mutually exclusive solutions by offering tax breaks to businesses that come at the expense of other businesses and workers while raising salaries and benefits for workers that comes at the expense of businesses. Unions further drive the squeeze home by benefiting senior workers over junior and unionized workers over non-unionized workers. Businesses eventually are left with no choice but to squeeze out of the system by moving their factories abroad. Workers however remain trapped with dwindling jobs and salaries that seem high but are quickly cut to pieces by the government's insatiable need for taxes. Every time their minimum wage goes up, so does the cost of living and their taxes, so that they have no choice but to keep running the Red Queen’s Race. When government does finally cut taxes, it does so without cutting spending, resulting in even worse economic problems as the country goes deeper into debt that still has to be paid for at the expense of its citizens.

Here lies the fundamental cause of the Red Queen's Race, because rather than shrinking government and decreasing taxes, governments respond by increasing the size of government and the demands that the government places on the public and businesses. As the prosperity of Western nations increased, the Nanny state emerged as a way of spending all that money by providing increased services to the public. Each government agency and program once spawned becomes virtually impossible to kill and each layer of bureaucracy has a vested interest in finding ways to perpetuate itself.

The economic problems that drive illegal immigration also result in a growing demand for social services which increase the size of government, further feeding the beast. That same bureaucracy helps fund the religious and secular social services agencies which then lobby for more government services. In doing so the government is actually funding the very mechanism that demand more money from itself. When that new generation of illegal immigrants is legalized in response to the outcry, everyone knows quite well that a new generation of illegal immigrants will replace it and the cycle will continue. And so will the Red Queen's Race.

(This article has previously appeared at Canada Free Press)