A friend recently mentioned on his blog that the Don Imus affair showed the only way that he trusts the private sector. He finished his post by saying that he likes his government large and well paid. I tried to point out all of the benefits of our private sector, they provide damn near everything for us. They do it well and the products and services are always evolving to suit us. We get what we want when we want it.
I really, really don’t understand wanting a big government. All of the evidence points to the fact that that the larger your government is (as a percentage of GDP), the worse your economy performs. The Soviet block countries, Cuba, and the current North Korea are the extreme examples. I don’t think we have to worry about becoming like North Korea, but take a look at some of our friends in Europe. France has an enormous government and “protects” workers from the private sector. The result? Massive unemployment and an unsupportable welfare state. They are facing a demographic collapse due in no small part to their tax/government systems in my opinion.
But surely we need the government to protect us from private companies. Without all of their regulations we’d be at the companies mercy, right? I blogged a little while ago about how we are the ones that run companies, I will repost that. What I want to concentrate on here is the relative risks we face with corporate malfeasance as opposed to government threats. As a rebuttal to my comment on his post, someone sent me a link about a daycare facility closing without any notice. Parents had to find daycare the next day. Now that is certainly a royal pain, and pretty inconsiderate, but it was hardly an enormous problem. You want an enormous problem? How about the unfunded liabilities of our social security system or the enormous debt that our government has racked up. They have saddled our great grandchildren with paying for our foolish economic ways. Here’s the thing, you can come up with the absolute worst case scenario for bad behavior in the corporate world, and it will not hold a candle to what governments have actually done. Think of the nastiest, conniving businessman who specializes in evicting widows and orphans as his business. He makes 6 year olds work 15 hours a day and makes them eat nuclear waste at gunpoint. Ok, that’s pretty bad, but a little ridiculous. He still doesn’t compare to say, Stalin. Hell, he doesn’t even compare to Mugabe or Huessain. What about Milken, Schilling, or any other white collar criminal? Once again, they can’t compete badness-wise with the likes of Sen. Mcarthy, J. Edgar Hoover, or maybe even Cheney. The corporate scandals that have cost people millions upon millions of dollars do not come close to the business as usual buddy buddy dealings in the the government. Think of the worst corporate scandal you can think of. How much did that cost people? Did you know that the agricultural subsidies in the US have cost the taxpayers over 1.2 TRILLION dollars over the past 10 years? That doesn’t even include the higher prices we had to pay for the goods because of the protection offered to Archer Danials Midland and others by our government. This isn’t even a big deal, hardly anyone ever hears about it.
Here’s my point. Yes, there are terrible people out there. Low lifes and morally challenged people that will do anything for a dollar. Yes, we should be on the lookout for them. The good news is that the effects of their bad behavior are fairly limited in the private sector. The fact that these people exist is the reason that we have to be so careful about the government. The government is made up of people, just like the private sector. When morally corrupt, power hungry, profit seeking people get into the government, the stakes are much, much higher. The private sector, by its very nature, limits the impact of any one company or person. One person in the government can have enormous impacts on many different things in our life, now think of an entire party and what they can “accomplish.” Most of the time, the problems in the government aren’t obvious, the problems don’t appear until later and the costs are often hidden. Sometimes, the person doing it doesn’t even realize what they re doing is so bad (see our outstanding debt as an example). Regulations are often times (but not always) made for the supposed benefit of the tax payers, but due to the fact that politicians are, well, politicians, we don’t get the results that they were looking for. Unintended consequences of regulations have cost us plenty. This is also my prime motivation for keeping the government out of the private sector as much as possible. The Private sector is where everything happens. It is what produces all of the innovations, it is what has lengthened our life-span and made our life much more comfortable. Places that rely on the government to do this fail miserably. We should learn from both our past successes and other countries’ problems (Germany, France, Yemen, etc.). People pursuing a better life are what moves us forwards, not the government.
Isaac
