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| Why Government Is The Problem | | Date Created: Apr 24, 2005, 12:05 PM |
 Why Government Is The Problem is a monograph by Milton Friedman put out by the Hoover Institution. It's from 1993 and all of 18 pages long including the Q&A from when the lecture was given. I could just about put the whole thing here. I could also sum it up by Friedman's famous quote, "There is no such thing as a free lunch" which he admits, in answer to a question about it, was not his thought originally. It's from Robert Heinlein. I knew I'd heard that before Friedman.
Apparently the lecture and topic were stimulated by an issue of Freedom Review (an oxymoron as he points out) where some poor deluded soul referred to "Reagan's fatuous doctrine that government is the problem".
Friedman views the easy task as documenting the many ways in which government is the problem (all levels of government but worst at the federal level). This section is weak for anyone who's not already convinced, but he briefly lists and comments on education, lawlessness and crime, homelessness, family values (which didn't have the baggage attached to that terminology that it has now), housing, medical care, financial system, highway congestion, airports, and some miscellaneous areas. He concludes this section by stating:
"None of this means that government does not have a very real function. Indeed, the tragedy is that because government is doing so many things it ought not to be doing, it performs the functions it ought to be performing badly. The basic functions of government are to defend the nation against foreign enemies, to prevent coercion of some individuals by others within the country, to provide a means of deciding on our rules, and to adjudicate disputes. I wonder if any of the liberal pundits who go around saying that the private market and capitalism, not government, is the problem can name any corresponding set of major problems that afflict our society that derive from enterprise." (He goes on to explain the "knee-jerk answer" of pollution.)
The tougher problem is explaining why government is the problem.
"One common explanation of why government is the problem, and one that I have often stressed, is the influence of special interests. Government actions often provide substantial benefits to a few while imposing small costs on many."
"If a private enterprise is a failure, it closes down -- unless it can get a government subsidy to keep it going; if a government enterprise fails, it is expanded. I challenge you to find exceptions."
[These two are the source of the "ratchet effect" of government. It only grows. It never gets cut back.]
"What we now have is a government of the people, by the bureaucrats, including the legislators who have become bureaucrats, for the bureaucrats."
"You remember Adam Smith's famous law of the invisible hand: People who intend only to seek their own benefit are "led by an invisible hand to serve a public interest which was no part of" their intention. I say that there is a reverse invisible hand: People who intend to serve only the public interest are led by an invisible hand to serve private interests which was no part of their intention".
[I would add "personal interests" to "private interests" in that last sentence.]
...referring to a study by James Payne, "Overwhelmingly, Congress's views on spending programs are shaped by government officials themselves."
[That's because there is no "society", "the people", "the poor" etc to say what it wants or any way to know what they want other than as they express it in a free market. There are only special interests once you get beyond individual choice.]
"The key problem is that we are unable to practice what we preach because of what has happened to the governmental structure."
[Bush is not the problem. Kerry was not the answer. The problem is the government.]
...in answer to a question, "...how can we take advantage of the diversity of our population in order to maintain the well-being of all of us? The answer is straightforward: by reducing the role of government."
"The great virtue of a free market system is that it does not care what color people are; it does not care what their religion is; it only cares whether they can produce something you want to buy. It is the most effective system we have discovered to enable people who hate one another to deal with one another and help one another."
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