Everyone is aware that America faces a financial crisis involving the $16.3 trillion national debt, the impending “fiscal cliff,” and the long-term insolvency of entitlement programs. But America also, and more fundamentally, faces a moral crisis—a crisis that underlies and gives rise to the financial crisis—and we cannot effectively act to solve the country’s economic problems until we are willing to recognize and address the deeper moral problem.

To see this relationship, consider the proximate cause of the so-called fiscal cliff. Over many years and decades, Federal politicians have spent trillions (and promised trillions more) for entitlement programs (euphemistically called “welfare” or “security” programs), corporate welfare (euphemistically called “stimulus packages”), and myriad other rights-violating programs.

What reasons are given for this welfare spending and these business bailouts? Why must hard-working individuals hand over a portion of their wages to Social Security? Why must they give a portion of their paychecks to Medicare and Medicaid? Because, we are told, we all must sacrifice for the welfare of the elderly and the “poor”—this is in the interest of the “greater good.” Why must some Americans surrender their hard-earned wealth to bail out failing banks and power-lusting auto unions? Because, we are told, we all must sacrifice for the “greater good”—and the failure of big businesses is not in the interests of the greater good. We hear similar arguments for every redistribution program.

Runaway federal spending is the political result of runaway altruism—altruism being the moral code demanding that individuals sacrifice their own values, such as their wealth, for the sake of others or the “greater good” of society.

Any rational response to the fiscal cliff must begin with three forthrightly stated principles: 1. Each individual has a moral, inalienable right to his own life and to his own wealth; 2. This right is grounded in the fact that acting in one’s own rational self-interest is moral because it is the fundamental requirement of one’s life; and 3. Altruism, the morality of self-sacrifice, is, as Ayn Rand put it, “a morality for the immoral” and is utterly incompatible with individual rights.

Given the correct moral basis, the way to deal with the fiscal cliff is relatively simple and straightforward. First, eliminate all future tax hikes. Second, dramatically cut government spending in every area and aspect of government that does not protect individual rights. Third, cut taxes across the board—and continue cutting them wherever and whenever possible. Fourth, begin phasing out Social Security, Medicaid, and all other entitlement programs—and continue phasing them out until they are no more.

The moral cliff is the morality of altruism, with its political consequence of a rights-violating entitlement state. America’s moral salvation is the code of rational self-interest, with its political consequence of a government that protects individual rights.

Life- and liberty-loving Americans must stop jumping off the moral cliff—that is, sacrificing themselves like lemmings for an alleged “greater good”; and they must begin recognizing their own and others’ rights—that is, producing, trading, repudiating government coercion, and living as rational, selfish human beings.

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