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Market Oracle FREE Newsletter


The Crime of Big Government

Politics / Government Intervention Aug 19, 2009 - 08:00 AM GMT

By: LewRockwell


Diamond Rated - Best Financial Markets Analysis ArticleDavid M. Woods writes: The following is a fictitious, but predictable conversation:

Me: I have a problem.

Other guy: Well, I have a solution!

Me: You have a solution?

Other guy: You bet!

Me: But I haven't even told you what the problem is yet.

Other guy: Doesn't matter. I already have a solution for it.

Me: [sigh] Ok, smart guy, what is my solution?

Other guy: Why, it's obvious – the solution to your problem is: Big Government!

On any day of the year, one can find editorials, blogs, opinion pieces, and conversations anywhere and discover that the attitude exhibited by the other guy above is very prolific. There is this unwritten assumption that, given any problem or bad news of any kind, that government politicians and bureaucrats know what's best for all of us; that anyone who works for the government is, by definition, smarter, wiser, and has more honesty and integrity. And so, every time something bad happens, they all respond with that all-too-predictable knee-jerk response that, by golly, the government needs to DO SOMETHING about it! And inevitably, the government DOES indeed do something: it gets bigger and more powerful, and spends more money.

The purpose of this article is to demonstrate the silliness of that mindset, and to try to get people to think twice before responding with the automatic knee-jerk reaction described above – in short, to try and think "out of the box" of trying to fix every conceivable problem known to man with that same old worn-out response: that the solution is more laws, more regulation, more spending, more bureaucracy, more governmental power and control over our lives and private affairs, less freedom, and yet another "War On [fill in the blank]."

The knee-jerkers in our society come from all walks of life. White, black, rich, poor, conservative, liberal, it doesn’t matter. They see a need, and they assume bigger government will fill it. Never mind that on any day of the year, boundless examples of governmental waste, fraud, abuse, and just plain stupidity can be found everywhere.

Here's some classic examples: The government subsidizes tobacco companies, yet requires warning labels on cigarette packages. Another: the government must invade Iraq because they masterminded the 9/11 attacks and had enough WMDs to defeat the USA. Another: the federal government's inability to balance its budget now adds to over a $trillion. Each year. I could go on.

The truth is that government is not the source of all prosperity, the answer to all questions, the solver of all problems, the boundless fount of wisdom and honesty. Government employees are not gods! They are but imperfect humans subject to the same faults as the rest of us. A better description would be that they are a pack of blundering fools, hell-bent on accumulating power and control at our expense. The song-writer was talking about government in that famous line: "He can’t even run his own life, I'll be damned if he'll run mine!"

The Evidence

So how can one PROVE that big government does not work? The first evidence is the following observation: If big government is what you want, you got it! Look around you! The U.S. federal budget is way up in the multi-$trillions now. The federal registry contains so many laws and regulations that it takes an entire building to house all the hard paper copies. If you plotted government growth over the last 50 years on a graph, it would draw an upward-curving line that is now vertical.

And it's not just the federal government. Out-of-control government growth is happening everywhere – it's happening in all 50 states, in every county, every city. And it's not just the U.S. either – it's a global phenomena.

So clearly: if you are an advocate for Big Government, you won. Hands down, with flying colors. Those of us who tried to resist it never had a chance. You left us in your dust.

But here's the real mind-boggler: the bigger government gets, the more people scream for bigger government. It's like some kind of addictive narcotic. This leads me to ask all you big-government advocates a basic question: where are you going with this? Will government ever reach a size where you will say: "OK, government is big enough now, we've won all our battles, we can sit back and enjoy the fruits of our efforts." Based on historical trends, I would have to say the answer to that question is: No, I don't think that day will ever come.

And the reason that the big-government advocates will never cease their efforts is: despite their belief that big government was supposed to solve all problems, it simply has not happened. Problems still occur. The perfect world that should have been attained by now has, in fact, not happened.

Which brings us to the next item of evidence to prove that big government doesn't work: history. Throughout human history, there is a clear, irrefutable relationship between limited government and prosperity. The ash heap of history is littered with tyrants and dictators that tried to mandate happiness and prosperity via big government and failed again: the USSR, Cuba, Cambodia under Pol Pot, Afghanistan under the Taliban, or pick your favorite Middle Eastern monarchy, or African or Central American banana republic du jour.

For the closest thing to a "controlled test," consider East and West Germany, or North and South Korea. Here you have pairs of nations with the same history, same culture, same language, and the same natural resources, yet one was poor, one was relatively wealthy. Why? One had big government, one had small government. Go figure.

The next evidence is based on an industry-by-industry comparison. Consider these industries: Transportation. Energy. Health care. Education. Insurance & financial services. These are some of THE most highly regulated industries in our society. And all of them are plagued with horrendous performance and sky-high prices. When the banking and mortgaged industries melted down in 2008, the knee-jerkers all said, "Well, the free market failed again! Time to let the Government run things." These people never stopped to realize that those industries are hardly a bastion of free enterprise.

At the other extreme, consider these industries: Clothing & apparel. Shoes. Electronics. Prescription eyewear. Entertainment. Beverages. All these industries have ever-falling prices and ever-growing innovation and quality products – and relatively little government meddling. The contact lenses I wear in my eyes are awesome, and cost so little I throw them away after 3 weeks. If free enterprise works for eyewear, why would it not work for banking?

The next piece of evidence comes from the Bible. If you asked God what his opinion was of government, what would he say? This passage is a paraphrase from the Old Testament book of 1 Samuel, chapter 8:

"Give us a government!" the people demanded.

"You don't want a government" God replied.

"Yes we do!" the people said.

"Look, if I give you a government, here's what will happen: It will turn your sons into cannon fodder, force your daughters to work in sweatshops, steal your land, your homes, your animals, and your paycheck, take away your kids, and generally make your lives miserable until you scream in agony."

The people replied, "And your point is?"

God sighed. "Very well then, here's your government. But don't say I didn't warn you!"

Clearly, the Big Man Himself even thought government was a bummer.

Government defined

So about now, the obvious question should be: What exactly IS government? The answer comes from German sociologist Max Weber: Government is that entity which has a monopoly on force within a prescribed geographic area. The key word here is FORCE. Government and only government can legally use physical force to achieve its goals. Government agents can punish you, with whatever level of violence they think is necessary, to whip the citizenry into line.

A government agent can approach you with a deadly weapon and demand your money. You and I cannot legally do that. But the agent can whip out a card that says he’s a government employee, and for reasons that befuddle me, it’s suddenly OK.

A government agent can tell a business owner: "Mr. Businessman, we don’t like the way you run your business, we don’t like the prices you charge, we don’t like what you pay your employees. Our people will now come in and straighten things out." And if the business owner protests, they can haul him away and lock him up.

The government, by way of the Federal Reserve, can counterfeit our currency. They say they're "stimulating the economy," but if you or I attempt to "stimulate the economy" like that, we would surely endure much suffering.

The targets of government violence do not even have to be inside our borders. The U.S. government can say to any foreign government anywhere: "We don't like the way you govern your nation. Therefore, we will attack you, invade you, embargo you, and bomb you until you fall into line with our desires."

Government is violence. And violence is never a tool of productivity, wealth, prosperity, or problem-solving, and it should not matter if the perpetrator has a card saying he’s an employee of the government.

The only positive role of force in a civilized society is to DEFEND your life and property against others who employ violence or dishonesty. But when government uses force to steal your property, run your life and your private affairs, counterfeit the currency, and provoke war, that is not defending anybody. Let's call government what it really is: a gang of thugs.

The standard response to this charge is that government must do these things because they are acting in the "national interest" or the "common interest" or the "common good" or whatever buzzword you prefer. So let me get this straight: the government must steal my money to pay hordes of fat-cat government bureaucrats their 6-digit salaries because … it’s in my "interest"? The government must spend tens of $billions of my dollars each month to turn some hellhole over in the Middle East into the biggest special interest project in history, because it’s "good" for me? I have no patience with people who feel they can run my life and spend my money better than I can, and are all ready, willing, and able to physically punish me if I disagree.

Another standard answer is that government force is justified because "the people" voted for it, thus government has a "mandate." Let's examine this myth. If one does the math, one realizes that the President of the United States is usually elected by only about a fourth of the adult population. (70 million voted for Obama, out of a population of about 250 million over the age of 18, yielding about 28%.) What kind of "mandate" is 28%? And this figures gets much lower when state and local offices are considered, due to low voter turnout.

Furthermore, the typical average voter is a clueless moron who values style and image over substance. Ask any voter in that 28% group why they voted as they did, and odds are you will not get an intelligible answer. They will probably say that the candidate "made them feel good," or that they simply picked a candidate at random, or they will give the "sheep" answer: "everyone else was voting for him, so I did too!" And this is how politicians acquire the power to run our lives?

The Alternative
So if government didn’t "run the country" and protect the "public interest" and do all the things it attempts to do, who would? The answer, in short: people. Workers, volunteers, entrepreneurs, you and me. People, voluntarily cooperating with one another, acting in their own best interest, can solve problems and produce the goods and services we all need and want. It’s called free enterprise – a system where people are allowed to buy, sell, work, and trade without interference, so long as their actions are peaceful and honest. The free market always can solve problems and produce what people need better than government. There are no exceptions.

Consider: an airplane crash, an event that most people instinctively think only government can prevent. So which of these two people is in a better position to prevent an airplane crash? The CEO of the airline, who’s very livelihood depends on convincing the public that his product is safe, or some bureaucrat in Washington, who’s livelihood depends on the continuation of airplane crashes?

Consider: government "entitlement" programs, where the vast bulk of the collected revenues go to bureaucratic overhead. In contrast, non-profit organizations must demonstrate positive results, else their contributions will disappear.

Profit or non-profit, all private institutions in the free market must convince you to donate, or to buy their product, because it will make your life, or some else's life, better. They must persuade you to come to work for them by offering a better job than the next guy. Government, on the other hand, says: follow our orders or we will punish you. The free market offers a positive incentive. Government offers a negative incentive.

Is the free market perfect? Of course not, because the free market is run by people, and people are imperfect. But wait a minute – who runs the government? People do, not gods!

But what about all those businesses and non-profits that run fraudulent operations and steal people’s money, or who hire goons and thugs to apply coercion? Let me point out that that is NOT free enterprise. As already stated, people should be left alone as long as their actions are peaceful and voluntary. It is true that, in any society, you will have some people who use violence and dishonesty to try to get ahead. But this type of behavior has never been acceptable and has always been outlawed. But let’s be consistent here – no exceptions if the violent perpetrator happens to bear a card saying he’s a government employee.


So where is this argument going? Should we totally abolish all government? Not necessarily. Government can have a role, but it’s a very small role: to institute a system of justice to protect us from force and fraud. As stated earlier, force is justified only for defending life and property. There are those who feel that government should perform that task; a compromise here is not unreasonable. But everything else government does, or attempts to do, must go.

So quit supporting politicians who use every crisis, every emergency, every problem, every piece of bad news as yet another excuse to make government bigger, more powerful, and more expensive. Instead, look for a politician who promises something like this:

"Because of the current crisis situation, I propose that we totally abolish each of the 100 government agencies listed on this report, and that we reduce government spending by 90%. Yes, I know it’s very drastic, and it will be very painful; but, it’s an emergency. And it’s a proven fact that big government does not work."

August 19, 2009

David Woods [send him mail] is an I.T. Business Systems Analyst living in Houston.

    © 2009 Copyright David M. Woods / - All Rights Reserved
    Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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