When the Government chooses the winners and losers

Ponzi socialism

By CHARLES GASPARINO

I Have seen the future, and it doesn't work.

Don't get me wrong: New Year's in beautiful Barcelona was a blast. Spain is a great vacation spot, with good food and gorgeous women -- but nobody seems to be working outside the tourist areas.

The reason is pretty simple: The Bernie Madoff-like Ponzi scheme of big government has been squeezing the productive class and redistributing its tax dollars and innovation to everyone else for years -- and is finally reaching its boiling point.

And the way things are going, we're probably not far behind.

Barcelona met the new year with the sort of subdued celebration that only 40 percent unemployment can bring. Once-swanky shops and restaurants along grand boulevards such as the Avinguda Diagonal remain vacant. Aside from the occasional government project, there's little sign of building or expansion.

The problem is that there isn't enough tourism to keep many of these businesses afloat; the natives who still have jobs don't have enough after-tax money to keep the private economy alive.

Spain -- like Portugal, Italy and, of course, Greece -- offers the lofty cradle-to-grave entitlements that only a Ponzi-schemer like Madoff could love: Big government stays big by buying the votes of those who feast off free health care and guaranteed pensions. But the system works only as long as enough productive people can keep working and paying the high taxes to keep the benefits rolling.

What happens when they can't find jobs -- because businesses can't afford to stay open because of high taxes? Well, the most productive move elsewhere to find better-paying jobs (as relatives of mine have left the Mezzogiorno region of southern Italy for generations).

Those who stay can't earn enough because businesses are paying so much in taxes that wages stagnate -- and the married couples among them can't afford to raise the next generation of productive citizens.

It's the same thing that happened when Madoff's customers began yanking money out of his fund: He could no longer maintain his shell game of "guaranteed" 12 percent returns, and his scheme collapsed just as the modern European welfare state is collapsing under the weight of its own guarantees.

Across Europe, private-sector jobs are disappearing, while governments face imploding budgets, debt defaults and social unrest. Unless the new Congress can change things quickly, the same will most certainly happen here in America.

After all, this is President Obama's vision for our future, with universal health insurance and entitlements for all -- except, of course, if you own a small business or work hard enough to make more than $250,000 a year, and thus are a "fat cat." Two years of this has brought us persistently high, 9 percent-plus unemployment.

There's some hope: November's elections caught Obama's attention; he reluctantly cut a deal to extend the Bush-era tax cuts and sent his economic advisers to assure the business community that he doesn't consider it the enemy.

And the political winds seem to be blowing us a better economy. A report out just yesterday showed that private-sector jobs are beginning to surge to levels not seen in years.

But the president still promises to kill those tax cuts in two years and to push even harder to impose ObamaCare and other big-government programs. He seems to think the European-style model is working -- even as rioters clash with police over there and young people leave the most economically devastated places.

Others in our government see the Ponzi scheme for what it is. The new House Budget Committee chairman, Rep. Paul Ryan, vows to fight all Obama's initiatives to extend the size and scope of government.

Gov. Chris Christie of New Jersey hasn't been afraid to take on his state's special interests, including the powerful teachers unions and other public-employee groups. Andrew Cuomo, New York's new governor, has so far been talking the right talk, with his plans to freeze state workers' pay and even cap spending and property taxes.

There was no more eloquent spokesman for the modern welfare state than Andrew's dad, three-term Gov. Mario Cuomo. But the younger Cuomo seems to realize that the government Ponzi scheme just doesn't work -- that it's why jobs are fleeing the state. Here's hoping Andrew's "conversion" is real -- and that he actually walks the walk.