In 2003 the state of Connecticut offered the coastal village of Stony Creek a $250,000 grant to make possible the long-overdue restoration of Seaside Hall, home of its beloved fife-and-drum corps. After a hard look at the extensive strings the state attached to the money, the townspeople decided to do the job themselves instead. Now the renovation is nearing completion after years of spaghetti dinners, auctions, and other local efforts. Karen Lee Torre recounts the story in the Connecticut Law Tribune.

The fife and drum corps can be seen in period regalia here and, performing at the hall in civilian clothes, here. For some readers, incidentally, the village of Stony Creek may ring a bell as the place where author Ayn Rand worked on her novel “Anthem” while summering with husband Frank O’Connor in 1937.

“Now on Democrats’ agenda: Budget cuts,” proclaims a front-page headline in Saturday’s Washington Post. The online headline reads, “Democrats add fiscal austerity as a campaign issue.”

Good news, huh? Let’s check it out:

The candidate was outraged — just outraged — at the country’s sorry fiscal state.

“We have managed to acquire $13 trillion of debt on our balance sheet,” he fumed to a roomful of voters. “In my view, we have nothing to show for it.”

And that was a Democrat, Sen. Michael Bennet of Colorado, who voted “yes” on the stimulus, the health-care overhaul, increased education funding and other costly bills Congress approved under his party’s control.

Meanwhile,

Paul Hodes, the Democratic Senate candidate in New Hampshire, recently proposed $3 billion in spending cuts that would slice airport, railroad and housing funds. Elected to the House four years ago as an anti-war progressive, Hodes lamented that “for too long, both parties have willfully spent with no regard for our nation’s debt.”

So Senator Bennet is outraged at the national debt — for which we have “nothing to show” — but he has voted, apparently, for every one of the spending bills in his time in the Senate that have created today’s $13 trillion debt. The National Taxpayers Union says his overall voting record on spending bills rates an F.

And Representative Hodes is calling for a $3 billion spending cut. Sounds big, eh? Front-page news indeed. But of course, it’s less than 0.1 percent of the 2011 federal budget — and that’s assuming that all these cuts would come out of this year’s budget. Hodes’s press release doesn’t make that clear; they might be cuts over 5 years or so. And his very next press release said he was fighting for federal funds for local New Hampshire services.

Both Republicans and Democrats want voters to think that they’re getting tough on spending, deficits, and debts. But their statements are at wide variance with their actual records and actions. We didn’t pile up $13 trillion in debt while no one was looking; members of Congress, of both parties, voted for these bills. Voters need to watch what they do, not what they say.

My colleague Chris Edwards, quoted by reporter Shailagh Murray, is a little more polite:

“The problem from a fiscal conservative voter’s point of view is that every member or wannabe member claims to be a fiscal conservative these days, so it’s more difficult than usual to separate the wheat from the chaff,” said Chris Edwards, director of tax policy studies at the Cato Institute, a libertarian-leaning think tank.

“Three top Republican House members have written a book that repeatedly criticizes former GOP leaders as well as President Obama,” reports the Washington Post. “In ‘Young Guns,’ scheduled for release Sept. 14, Reps. Eric Cantor (Va.), Kevin McCarthy (Calif.) and Paul D. Ryan (Wis.) cast the Republican congressional leaders who preceded them as a group that “betrayed its principles” and was plagued by ‘failures from high-profile ethics lapses to the inability to rein in spending or even slow the growth of government.’ ”

Good point! And one we’ve made several times at Cato.

But how credible are the messengers? Once you ruin a brand, it can take a long time to restore it. And part of the solution is owning up to your own errors, not just pointing the fingers.

In this case, I’m sorry to discover that Reps. Cantor and Ryan both voted for the Bush administration’s No Child Left Behind Act in 2001, expanding federal control over education. They both voted for the costly Iraq war in 2002. They both voted for the Medicare Prescription Drug, Improvement, and Modernization Act in 2003, which was projected to add more than $700 billion to Medicare costs over the following decade. They both voted for the Emergency Economic Stabilization Act of 2008, which included the $700 billion TARP bailout. (Rep. McCarthy, who joined the House in 2007, voted against TARP.)

To be fair, all three of the authors get A’s and B’s in the annual ratings of Congress by the National Taxpayers Union, which means they have better records on spending than most of their colleagues. But I’ll be curious to see if the book admits that any of the near-trillion-dollar votes discussed above were mistakes — not just by the departed Bush, Hastert, and DeLay but by many Republican members of Congress.

I recently criticized the idea that policymakers should focus their attention on making government more “efficient.” Instead, I argued that policymakers should focus their reform efforts on reducing government’s size.

Government efficiency proponents make the mistake of viewing the cost of government in the same light as the cost of operating a private business. However, government cannot operate like a business because it isn’t a business.

Private businesses obtain their revenue through voluntary exchange: consumers willingly give a business their money in return for a product. Businesses must control the cost of providing a product in order to maximize profits. A business that does not adequately control its costs can find itself undercut by a competitor offering a like product at a lower price. In the private sector, the market sets the price of a product through the interaction of supply and demand.

Government is unconcerned with “profit.” The “cost” of government is equal to the taxes extracted from the private sector to pay for government activities, plus the economic damage caused by extracting resources from the private sector. Taxes are involuntarily obtained through compulsion and force. Regardless of the value a citizen assigns to the services provided by government, a citizen must pay for those services, and at a price set by government. The price one pays for government is primarily a function of political factors, which are only indirectly influenced by economic considerations.

Therefore, the question of how efficiently government provides services is less important than deciding what services government should provide. For example, it matters little how quickly the USDA processes subsidy checks for farmers. More important is whether farmers should be receiving subsidy checks at all.

To understand why this is so, consider the following example of two policymakers from opposite ends of the political spectrum. Both policymakers support government efficiency as a means to a statist end.

Indiana governor Mitch Daniels has received national recognition as a “pragmatic conservative” who has focused on making state government operate more efficiently. Indeed, I worked for two years in Daniels’ budget office and one of my duties was to try making state programs more efficient.

To the degree my agency’s efforts created savings — a debatable premise — those savings were merely spent in other areas. This is because the Daniels administration was concerned with reallocating savings to other government activities instead of reducing the state tax burden. Net savings would have meant a smaller government to fund, which would have allowed for a reduced tax burden. But taxes weren’t reduced — the Daniels administration merely proposed to spend up (and now down) to the level of revenues the state took in. In fact, Indiana state tax rates have increased under Daniels.

Liberal congressman Earl Blumenauer (D‑OR) embraces government efficiency for a somewhat different reason, but the end is the same. In a recent New York Times profile, Blumenauer argues that liberals should actively embrace government efficiency measures in order to sustain public support for an expansive federal government:

Mr. Blumenauer doesn’t argue that government does too much, or that programs like Social Security and Medicare aren’t vital. Rather, in two recent conversations about the nation’s finances, Mr. Blumenauer argued that if Democrats really want to protect a vast array of federal programs from repeated Republican onslaughts, then they need to bring the costs of the programs in line with reality.

Otherwise, he said, liberals only make it easier for conservative critics of social spending to undermine the entire premise of liberal government. And they make it that much harder to propose new and much-needed investments in, say, infrastructure and education.

“We do people no favors if we have systems that leak money and don’t have the credibility they need when they’re under attack,” Mr. Blumenauer said. “People will pay for all this if they’re convinced they’re getting their value. But our challenge on the federal level is to actually deliver, and we can’t just defend the indefensible.”

The Times reporter augments Blumenauer’s position by placing it in the historical context of former Democratic senator Ed Muskie’s effort to make government more efficient:

Mr. Blumenauer may be out of step with his natural political constituencies, but his basic argument here places him squarely in a tradition of mainstream Democratic thinkers. As far back as 1976, in one of the more persuasive, if least remembered, speeches in the party’s modern history, Senator Edmund Muskie of Maine made essentially the same case to the Democratic platform committee and voiced his support for a “sunset bill” that would have subjected most federal programs to periodic review.

Mr. Muskie argued that it was hard to persuade voters to accept new programs while they entertained profound doubts about the efficiency of existing ones. Noting that some Democrats seemed to regard budget reform as “a repudiation of the New Deal,” he asked his colleagues: “What’s so damn liberal about wasting money? And what do waste and inefficiency have to do with the New Deal?”

The bottom line is that the road to smaller government won’t be paved with efforts to make government “more efficient.” In its most benign form, government efficiency is a political tool wielded by policymakers who probably aren’t serious about downsizing government. In its more pernicious form, it can lend credibility to activities that government should not be undertaking to begin with.

As I blogged earlier, yesterday the Kaiser Family Foundation and the Health Research & Educational Trust released their survey of employer-sponsored health benefits in 2010.

For most of this survey’s history, it included a very useful graph of the average growth rate of employer-sponsored insurance premiums. Here’s the graph from their 2007 survey:

(The grey and light-green lines represent year-to-year growth in overall inflation and wages, respectively.)

Unfortunately, 2007 was the last year that KFF/HRET included that graph in their annual survey. Had they included that graph this year, it would have shown an even more heartening moderation of premium growth:

A lot of things can drive premium growth. I discussed a couple of them in my last post. Some factors that could cause premium growth to moderate might not be all that welcome; if insurers dumped all their sick enrollees, for example. But absent dramatic evidence of that, isn’t this good news? And isn’t good news worth highlighting?

[above quote attibuted to American writer Minna Thomas Antrim (1861–1950)]

The AP reports on trouble facing the Chinese census:

After years of reforms that have reduced the government’s once-pervasive involvement in most people’s lives, some Chinese are proving reluctant to give up personal information and harboring suspicions about what the government plans to do with their details.

OK, the headline may be a bit overstated, but recent comments on immigration by Gov. Haley Barbour of Mississippi are different enough from what most of his fellow Republicans are saying to be newsworthy.

In a video interview released earlier this week (see link below), Barbour expressed appreciation for the Hispanic immigrant workers who helped rebuild his state after Hurricane Katrina in 2005, and for the need to be more open to highly skilled immigrants from countries such as India.

Barbour is an important figure in the GOP. He is in his second term, chairs the Republican Governors Association, and led the Republican National Committee back in 1994 when the party swept into power in Congress.

When asked what he would say to people in California who are upset about illegal immigration, Barbour responded:

Let me just tell you, I’ve had a different experience than perhaps some other governors. I don’t know where we would have been in Mississippi after Katrina if it hadn’t been for the Spanish speakers that came in to help rebuild, and there’s no doubt in my mind some of them weren’t here legally. Some of them were, some of them weren’t. But they came in, they looked for the work—if they hadn’t been there, if they hadn’t come and stayed for a few months or a couple of years, we would be way, way, way behind where we are now.

Every country—I don’t care if it’s the United States of America or Papua New Guinea, every country has gotta have a secure border. If you can’t secure your border, you’re not much of a country, and we’ve gotta secure our border. But we’ve gotta do so with the recognition that even in our lifetime we’re gonna have a labor shortage in the United States. We don’t want to be like Japan, where the aging population is supported by fewer and fewer and fewer and fewer.

So there’s gotta be a way—a) we gotta secure the border, but b) we’ve got to work through how are we gonna make sure we’ve got the labor we need in the United States. H1B visas—a huge, huge thing. My idea is everybody from Stanford who’s from India that gets a PhD, we oughta stamp citizenship on his diploma, so instead of him going back to India and starting a business that employs 1,800 people, that he’ll start a business that employs 1,800 people in Des Moines, Iowa, instead of India. A lot of this is just common sense, and common sense tells us we’re not gonna take ten or twelve or fourteen million people [currently here illegally] and put them in jail and deport them. We’re not gonna do it, and we need to quit—some people need to quit acting like we are, and let’s talk about real solutions.

You can view the video here, where the subject of immigration comes up at the 5:50 mark.

Although Barbour may be a minority voice on the issue within his party, he is not alone. The host of the show, the Hoover Institution’s Peter Robinson, is a former speech writer for Ronald Reagan who wrote back in June on the former president’s more inclusive view of immigrants. And I was joined at a Cato Hill Briefing in July by Rep. Jeff Flake, R‑Ariz., on the need for a temporary worker program as a key to immigration reform.

Let’s hope their fellow Republicans are listening.