RALEIGH – While the current debate about business bailouts and economic stimulus has its share of learned arguments and sophisticated analysis, there’s a quick way to get to the core of the issue.

Is personal responsibility a social good or a social evil?

The Obama administration, the Democratic Congress, and like-minded politicians and activists in North Carolina justify the new bill with the archaic Keynesian notion that consumer spending is good and consumer saving is bad. The new “Making Work Pay” tax credit, for example, is explicitly designed to discourage people from using their checks to pay down their mortgages or credit card balances. Yet the same politicians are promising another costly wave of deficit spending to bail out businesses and consumers struggling to handle their excessive debt loads.

This is not just contradictory. It’s revolting and dangerous.

Nearly 15 years ago, I helped found a broad ideological coalition to block the creation of a state-run lottery in North Carolina. Some members of the coalition opposed the lottery because they didn’t think there should be legal gambling at all in our state. Others opposed it because they saw state lotteries as a regressive way to finance government.

Although I didn’t think state government needed any more revenue to squander on ineffective programs, my main motivation for opposing a state lottery was that I didn’t want government to be in the gambling business, or in the business of promoting gambling. Whatever you think the legal status of gambling should be – I think individuals in a free society enjoy the inalienable right to make poor decisions with their own time and money, as long as they respect the equal rights of others – surely I could convince you that state leaders should not go out and actively encourage people to gamble their money away.

Or so I thought. Actually, if the General Assembly had followed the state constitution and their own rules, the lottery wouldn’t have passed back in 2005. Silly me, I thought that those intent on sacrificing their integrity to scam a few bucks from lottery players wouldn’t first sacrifice their integrity to pass the lottery bill. I can be so naïve sometimes.

So now North Carolina is knee-deep in moral decrepitude, its state officials seeking continuously to find new ways to trick the retired, the unschooled, and the desperate into buying lottery tickets so the state can make its revenue projections.

In fairness, the state had already waded a bit into the swamp before the lottery’s passage. For years, North Carolina’s official policy towards cigarettes and alcohol had been that you ought not to indulge yourself too much – but you ought to indulge yourself enough to help finance your share of state and local programs funded by special excise taxes on cigarettes and alcohol.

The latest vice championed by government is that North Carolinians ought to spend beyond their means and stop saving for a rainy day. Any parent imparting this lesson to their kids would be properly viewed as grossly irresponsible. For all their paternalistic pretensions, however, politicians are now saying precisely this, and structuring government policies to further subsidize sloth and punish thrift.

But recessions are not caused by increased personal savings. They are the cause of increased personal savings. As booms sustained by artificially easy money become painful busts, misallocations of capital become evident. Some business models are exposed as unsustainable. Some investments, say in housing stock (or, a decade ago, in dot-com experiments), prove to be unsound. As capital is reallocated to more productive uses, some jobs go poof and others are threatened. Households and businesses rationally respond to these scary events by cutting costs, reducing debts, and increasing savings.

Unless these savings are stuck in someone’s mattress, they expand the pool of loanable funds and become the seed corn for future entrepreneurial investments that create jobs and the potential for profitable economic harvests.

Savings are even necessary for the federal government to engage in deficit spending in the first place – someone must buy the bonds the Feds are selling. Apparently, it’s bad if Americans save but good if foreigners save. Or something like that.

If you’re searching for consistency or common sense, you won’t find it in the current bailout/stimulus mania.

Hood is president of the John Locke Foundation