Thursday, February 11, 2010

Big Government

Big Government

Liberal blogs have poked fun at the recent convention of Tea Parties. Not without reason – the keynote address by the Paris Hilton of politics, Sarah Palin, was the usual thin gruel for which Palin is reported to have been paid $10,000. But as thoughtful commentators have pointed out, the basic Tea Party complaint about huge government that is no longer under popular control needs to be taken seriously. In school, American children learn that the government derives its power from the people who control the government's actions. Once these children grow into adults they see that they have no control over the government.
The complaint is justified, but the question is, of course, what makes our government so big and uncontrollable? There are very many different answers to that question. Here are three of them.

The first source of a big, powerful government is our standard of living. 100 or 200 years ago, when most of us lived in smallish villages and life was much simpler and a lot less convenient, citizens could do for themselves what today we need the government to do for us. Consider roads and travel. As long as roads were unpaved and people walked, rode on horseback, or in wagons, if a bridge was needed in the village to cross a small river, everyone pitched in to build the bridge. But today we want to drive on six lane interstate highways that cross river small and large on huge concrete bridges. The local community cannot build such a bridge. It does not have the machinery. Besides we owe our high standard of living, in part, to the division of labor. Most of us do one thing and do it really well and really fast. But we don't know how to do many other things, such as building bridges. This is just one example of how our standard of living involves the government. It does many things which in an earlier age, citizens did for themselves. They could therefore have a much smaller government.

A second reason also has to do with our high standard of living. We live in a competitive society and many people believe that this competition between businesses contributes to everyone's welfare. That may be true but it certainly contributes to a serious expansion of government regulation and supervision.

Consider a simple example. In your neighborhood there are two supermarkets and both have meat counters. Both compete with each other for your custom. As a sensible consumer you go where the meat is cheapest. You buy cheaper chicken at one store and when you come home, you discover that you paid for a pound of chicken but brought home only 15 ounces. Returned to the store, the butcher weighs the chicken on his scale: a full pound. What happened? Someone fixed the scale. Because that is always a temptation in the competition between people selling food, the city has to have a bureau of weights and measures and inspectors who come and examine all the scales every so often. Government just got a little bit bigger.

The meat markets compete in other ways. One of them can sell me chicken more cheaply because they don't spend any money cleaning their butcher shop. You may buy cheaper chicken but when you come home it does not smell very good and if you are unlucky, you may get sick when you eat it. To forestall that, the government inspects butcher chops, restaurants, etc. Government acquires a new function and gets a little bit bigger.

No point in making up more examples. In a competitive system the temptation is ever present to save money in ways that would seriously harm consumers. The government protects consumers against those sorts of harms. If the butcher and baker were not tempted by competition to cut corners, the government could be a lot smaller.

A third reason for big government: The competition is part of the capitalist system. We attribute our high standard of living to capitalism. But capitalism has become an immensely complicated system which needs constant government supervision, fine-tuning, and adjustment to keep it from collapsing. Sometimes, even with all the fine-tuning, the system collapses anyway as we can see before our very eyes at the moment. Capitalism works because there are a lot of skilled civil servants who keep it from falling apart. When all those skilled civil servants fail, as they have in the recent past, only a big government can save the day-- a government that can lay its hands on $1 trillion to bail out banks “too big to fail.”

If we had a much smaller government we would have a lot more cheating in our daily consumption, public health would be in much worse shape and the economy would probably be completely bogged down. If you want honest weights and measures, food that does not make you sick, and an economic system that works instead of mass unemployment and poverty, stop complaining about big government for that's the price we pay for our standard of living and the economic system that delivers it.