(The New York Times) There is something you should know about the deal to cut federal spending that President Obama signed into law on Tuesday: It does not actually reduce federal spending.

By the end of the 10-year deal, the federal debt would be much larger than it is today.

Indeed, both the government and its debts will continue to grow faster than the American economy, primarily because the new law does not address federal spending on health care.

What we have here is a quintessential example of solving the problem by adding to it and thus making it worse. An excerpt from the chapter, ‘In Perpetuum‘:

At the root of this chain reaction is modern government’s position as both ruler and benefactor. Not only does the state dictate what must be done and how, it also plays a primary role in the doing. It diagnoses the problem and serves as the medicine. Indeed, the welfare state is the quintessential example of a business straddled with a conflict of interest. Just like any major profession nowadays—doctors, dentists, lawyers, mechanics, graphic designers—the more the client needs the services, the more the professional will get paid. So the professionals have an interest in making the client need (or at least convincing the client that he is in great need of) the services. We find the same predicament in government. The more the people need the government’s help, the bigger and more powerful the government becomes. So public officials and lobbyists alike all have an interest in making the people need (or at least convincing the people that they are in great need of) the Welfare State.

Take for example the fact that price controls create surpluses and shortages. These surpluses and shortages can only be remedied by some form of subsidies or credits. By taking action, the state necessarily creates a greater need for more action. It supports a system that continues to thrive as though there is nothing wrong, and yet, in order to do so, it requires the enormous apparatus below it to even survive. It is like a doctor that keeps prescribing medications to counter the side effects of other, previously prescribed medicines. There is seemingly no end to the process.

This is why the government is the beneficiary of nearly unlimited credence by the public body with respect to its authority. A government agency might be wasteful, unproductive, or wholly destructive, but, with the way the system is designed, it will garner funds nonetheless. Most government agencies are actually positioned to take in more money when they don’t reach their goals or achieve what they intended. The notion is that their failure was the result of lacking funds; so more funds are asked for and granted, and the whole process begins again.