Why the Political Class Needs a Greek Bailout

An interesting discussion at Armed and Dangerous. Snippets:

[R]aising taxes won’t help. The amount of private wealth available to be taxed is insufficient, even if taxation could be raised to 100% without suppressing all economic activity. In practice, raising taxes leads to increases in spending which more than consume the increased revenue (by a ratio of 1.17:1 in the U.S. since the 1940s).

Cutting military or any other form of discretionary spending won’t work either. If you zero all that stuff out, public pensions and other entitlement commitments still require revenues larger than the taxable private economy can generate.

and

Our political class, like the aristocrats of the French ancien regime, believes in nothing so firmly as its own indispensability.Après moi le déluge; but when the bond-investor flight happens – and it is now a matter of when, not if – the teetering Ponzi scheme that funds their self-importance will collapse.