Governments Can’t Make Wealth. They Just Take Yours.

I recently read a comment on this very site that I thought well-expressed a common misconception most people (even conservatives) have concerning the civil government’s role in the national economy. (Note: I corrected various typos.)

We know that for every two employees who get laid off, one additional worker gets laid off somewhere else. [We do?] US Gov. stats indicate that some 840,000 federal, local, and state employees have been laid off or not replaced. That translates into another 300,000 other workers in the private sector who lost their jobs. When people are not working, they are not spending and paying taxes and more people get laid off. The only way to stop this vicious circle is for the Gov. to invest in infrastructure programs like roads, fix the 30,000 bridges that are deemed unsafe to travel on, replace the 125 year old sewers before they become a major health hazard. This alone will create one million construction jobs and another 500,000 jobs in the private sector.

Notice that “the only way” to fix this problem is for government to get involved. Maybe I’m pointing out the obvious, but does anyone know who pays the bills for government jobs? For public construction projects? Government bureaucracies might write the checks, but they certainly don’t generate the wealth. The civil government has exactly two ways to get money: borrow or steal. (They don’t need to beg… they have really big guns.) They get money in taxes. Or they borrow money from other countries or the soon-to-be-audited Fed.

The only way to help the national economy, contrary to our friend’s opinion, is to generate real wealth by providing a product or service that people would be willing to pay for voluntarily. When the federal government conjurs up projects that aren’t really necessary, or would be better managed by local governments, they invite waste and corruption, and (big surprise!) they do not actually help the national economy in the long run. Governments cannot generate wealth. They basically have to force people to use their services as it is: public education costs more per student than private education, yet our students learn more about gang violence and condoms than they do about mathematics or history. Public healthcare costs us more and benefits us less. Even given the subsidies that the U.S. Postal Service gets from the civil government, they still haven’t been able to elbow out the competition. This is for a service that even the Founding Fathers thought would be public. The list goes on and on.

Personal example (Liberals love those, right?): In almost every city I’ve lived in, we’ve hired a private trash collection company, and we’ve never had trouble with one. In our most recent move, we were forced to fire our private collection service because the city requires that all the houses in city limits use the public trash sevices. Of course, since we’re all forced to use the public service, they have zero incentive to answer phone calls, collect the trash on time, collect all the trash, allow for deviations from their asinine policies, etc. Bottom line: they couldn’t exist in the free market.

And you’re all going to think I’m crazy, but I don’t think the civil government is necessary for roads either. Public roads cost more to build and require more money to maintain than private roads do. No one seems to think that we need the civil government involved to pay for our huge skyscrapers. Why should Big Brother be necessary to pave the roads that lead to them? We already have the money obviously. The government takes it from us to build the roads, remember? Or did you think it was an investment from the government’s personal treasury? The civil government takes some money from people who are still trying to be hard-working, wealth-producing citizens, and gives it to some other people for projects of dubious necessity. And let’s not forget that these private sector contractors then pay taxes. That’s right. Taxes on money the civil government paid them… in taxes.

Do you really think the civil government is more efficient at dealing with money than private companies? How about this… The civil government can just get out of the way. Let us keep the money they were gonna take to make jobs. We can take our money and give it directly to the private contractors to build the roads and improvements we think are necessary. If management is necessary for this, county governments should suffice. This should save us billions of dollars. And should we decide we don’t want to build new roads or electric cars or whatever, maybe we’ll just create some jobs by buying the goods and services we want and need from the private sector. Maybe we could start with education and healthcare.