and the
Citizens Economic Research Foundation

Barbara's Column
November 2004 #4

State must prepare for end of entitlement era
by Barbara Anderson

The Salem News
Wednesday, November 24, 2004

As we enter the Christmas season, it's nice to know that moral values are making a comeback. It seems that everyone now accepts them as necessary, and debate has turned to which ones belong in our political paradigm.

My good friend, Warren Brookes, was ahead of his time. In his 1982 book, "The Economy in Mind," he wrote: "Without the civilizing force of universal moral standards, particularly honesty, trust, self-respect, integrity and loyalty, the marketplace quickly disintegrates ... As Alexis deTocqueville suggested, the greatness of our economy can continue only as a reflection of the goodness of our people."

Warren died in December 1991. Because his was the economic mind behind Proposition 2, Citizens for Limited Taxation (CLT) created an award in his name. Over the years, it has been given to many people who have positively impacted the Massachusetts economy, including Lovett Peters, founder of the Pioneer Institute; Richard Egan of EMC; and Gov. Bill Weld. 

This year's recipient was Eric Kriss, Gov. Mitt Romney's Secretary of Administration and Finance, who gave an extraordinary speech in October 2003 to the Boston Chamber of Commerce titled "The Reform Imperative." In that speech he defined "reform" as "a new way of thinking, of solving problems out of the usual political confinements."

"Living within our constrained resources becomes the imperative," Kriss declared. "Doing the right thing becomes the process." Clearly, Warren Brookes would have approved.

Secretary Kriss' presentation to CLT activists this year at a Nov. 14 brunch was created just for the occasion. Because it is original and thought-provoking, I want to share it with you.  [the secretary's slide presentation -- PDF file format]

In honor of Yogi Berra; the speech is titled, "Deja Vu All Over Again." It compares the elections of 1960 and 2000, with their respective aftermaths.

During the 1950s, post-World War II America dominates the international community. There is an unprecedented economic boom. The cultural symbolism is gray flannel suit conformity. Economic disparity and Communism are unaddressed issues. 

During the 1990s, post-Soviet America dominates the international community. There is an unprecedented economic boom. The cultural symbolism is dot-com exuberance. Cultural disparity and terrorism are unaddressed issues.

In the 1960 election, there is ballot-stuffing in Chicago; in 2000, there are hanging chads in Florida. 

Catholic John Kennedy and born-again George W. Bush win, each defeating a sitting vice president. Both men are relatively young and inexperienced.

During their administrations, the nation experiences tragedy the Kennedy assassination in 1963 and the terrorist attacks of Sept. 11, 2001. These events are followed by bold action: Johnson's "War on Poverty" and Bush's "War on Terrorism." Initially, there is muted political opposition.

In 1964, the Republicans move right, as Democrats control Congress. In 2004, the Democrats move left, as Republicans control Congress.

In 1965, the Democrats spend their mandate on Medicare, Medicaid and social engineering, against a background of social turmoil. The question now is: What will the Republican mandate bring?

Having made his comparison, Secretary Kriss talked about the long-term impact of the 1964 mandate on Massachusetts a dramatic increase in the percentage of income spent on the poor, with the initial success leading to unintended consequences, followed by welfare reform during the '90s. The elderly are better off; but mental health lags, partly because of substance abuse. Medicaid caseloads explode and dependency on state programs grows. The male prison population increases dramatically, with more than 5 percent of white males, more than 15 percent of Hispanics and more than 30 percent of blacks jailed at some point in their lives.

Kriss warned that within a few years, the entire anticipated growth in state revenues will be needed for Medicaid alone. He finished with another Yogi Berra quote, "When you come to a fork in the road, take it."

As I understood him, the moral of the story is this: If a dramatic election in 1964 could propel the country in a new direction, then there's no reason that a dramatic election in 2000 couldn't do the same. Four years into the new millennium, we have begun to face our cultural disparity and deal with terrorism. At the state level, the question now is: Will we redefine the safety net, especially Medicaid, and face the consequences of the ongoing cultural revolution?

Kriss is optimistic. His conclusion made me think of words from John Naisbitt's "Megatrends," which was also published in 1982: "We are living in the time of the parenthesis, the time between eras ... we have extraordinary leverage and influence individually, professionally, and institutionally if we can only get a clear sense, a clear conception, a clear vision, of the road ahead."

At this Thanksgiving time of year, I think we should be thankful for this amazing opportunity.

Barbara Anderson is executive director of Citizens for Limited Taxation. Her syndicated columns appear weekly in the Salem News and Lowell Sun; bi-weekly in the Tinytown Gazette; and occasionally in the Providence Journal and other newspapers.