Your Government At Work

Government Job Creation

Your Government At WorkIn their never-ending quest to garner enough votes to stay in power politicians have several time-proven tactics. One of these tactics is to promise that initiatives will “create new jobs” for the community.

This is how a pure government program works. They announce there will be a new $100 annual tax. However, that tax will generate 10,000 new jobs. The ‘jobs’ consist of 10,000 people employed to collect the $100 tax. That’s all they do, they create reports about the collections, they have meetings about it, they have an annual conference in Las Vegas to discuss ways other governments collect $100, they create formal reports concerning projections and trends on collecting the $100 and they otherwise keep themselves marginally busy with all manner of activity related to collecting the new $100 tax. All of the 10,000 new jobs involve collecting the $100 tax that pays for the creation of the jobs.

That’s a government job creation program in its purest form. So pure that if the politicians were to lay it out that plainly and honestly most people would not support it. (Some are so clueless they can’t see the problems even with the purest presentation. Marxist might fall into this category as well as many socialists.)

So the politician’s trick is to blend in some tangible benefit. Let’s say the new workers collect the $100 tax plus they monitor the price of coffee in your region to insure you don’t get ripped off by coffee sellers charging what they say is too much. This is basically what all government jobs amount to, a big expense with – perhaps – some small tangible benefit.

The Problems Are Obvious

1. If you saw an ad on TV for a company that charged you $100 per year to monitor coffee prices you would be very unlikely to become a customer. It’s just not worth it to most people, and if there were a demand, cheaper options would soon enter the market. In the case of the government program you have no choice – you pay for it or you go to prison for not paying the tax.

2. Assuming the new government jobs pay an average of $50,000 per year in wages and benefits, hundreds of millions of dollars get sucked out of people’s wallets to pay for virtually nothing of value. That money might have been invested in improving your education or health or for the benefit of one of your children or invested in productive new businesses, or just buying consumer products made by companies that employ productive people. Potential investment that causes financial growth is redirected into wastefully spent money.

3. After a couple of decades the 10,000 government workers start to retire with fat (unfunded) pensions and the taxpayers have to pay them to sit at home and not work. Taxpayers also have to pay for the replacement workers. So the $100 tax has to be increased to $180. This trend continues automatically and relentlessly.

4. Because the government creates a monopoly in the market of “coffee price watchdog” there is a single point of failure in that watchdog function. Coffee companies can find ways to corrupt the watchdog process. Eventually prices can rise with impunity because the solitary watchdog is more preoccupied with keeping the 10,000 jobs and retirements intact than with providing the marginal value originally promised.

5. Perhaps worst of all, 10,000 potentially productive, inventive, creative workers are seduced by easy money and unsustainable pension benefits into a lifetime useless work that drags down the standard of living for all taxpayers and robs humanity of the positive contributions those people could have made in their lifetimes.

In the end the Government Job Creation program acts as a metastatic cancer on the standard of living and general welfare of everyone in the community. Every year the government workers want more money and benefits, some people in the community agitate to get similar jobs so they can get on the obvious gravy train of minimal work for big pay and they create pressure to further expand the program. Thus the cancer grows larger, draining more and more from the productive people in the community.

Every government program, department, office and function operates in exactly this way to lesser or greater degree. This arrangement can only exist in a coercive environment where people are forced to bear the expense in order to stay out of prison. In a truly Free society this situation can not exist. But we don’t live in a Free society, do we?

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Who Needs “Equality”?

This is a guest post about fairness and equality by Richard Paul Sprague, who lives in Hawaii and is a lifelong student of Freedom. Richard is happy to respond to comments below. If you would prefer his direct e-mail address to correspond just ask me.

Copyright © 2014 Richard Paul Sprague. All rights reserved.

The relation of “equality” is essential to nearly every branch of mathematics.1 Two (scalar) numbers are equal if their difference is zero (i.e., x = y if and only if x – y = 0). Two vectors A ≡ (a1, a2 …) and B ≡ (b1, b2 …) are equal, i.e., A = B, if and only if ai = bi, for each dimension “i”, which is equivalent to saying that A – B = 0, where 0 is the zero vector in that particular vector space.

Those with bad memories of public school math classes are probably already developing the shakes with just this short exposition, so I won’t go any further than this. The point is simply that the concept of equality is rooted in mathematics, and is borrowed from it, by analogy, to all other subjects.

The further point is that all analogies break down at some point, so that the most common uses of the word “equality” (all those outside of mathematics) lead to fallacious conclusions if followed far enough.

One of the most common fallacies is the concept of “equal exchange”. The idea is that an exchange is equal and therefore “fair” or “just”, if the items being exchanged are of “equal value”. It sounds plausible, and most people would probably say that this has to be true, yet it is easy to demonstrate that it is false:

A customer goes into a store and purchases a beverage, paying the store owner $1.00.2 So the advocate for “fair prices” must determine if the “value” of the beverage is equal to, greater than, or lesser than the $1.00 paid for it. The trouble is that value has no objective basis. A second customer might decide that he values $1.00 more than the same beverage, and therefore doesn’t make the purchase. The fact that the first customer did make the purchase is all the evidence needed to infer that he valued the beverage more than the $1.00. Similarly, the store owner values the $1.00 more than the beverage as evidenced by his offering the beverage for sale at that price in the first place. The two participants in the exchange disagree about the relative values of the things exchanged, because otherwise there would be no motive to make the exchange. This disagreement results, not in violence, but in co-operative behavior. Each participant believes the transaction came out favorably, and they are both right from their subjective points of view.3

Another common misuse of the word “equality” is in, well, any political discussion. The idea that two people are “equal” in the political or legal sense is one that is almost universally believed, but is easily refuted if any two actual people are compared. Even a fervent egalitarian4 won’t think that two actual people are equal in aptitude or talents, anymore than in height or weight or appearance. So, where is this magical legal and/or political “equality”? The egalitarian will likely answer that it is an ideal to which we should all aspire. And here the leading egalitarians stare at each other across a chasm.

A Classical Liberal will argue that the only necessary equality is “equality under the law”, which is satisfied as long as no law discriminates against a member of a group based on that group’s defining characteristics (e.g., sex, age, skin color, sexual orientation, religious or cultural affiliation, ethnic background, etc.) and that the same legal procedures to dispense “justice” are applied to all and the political process is available to all, as are voting rights. The classical liberal prefers liberty first, and only secondarily equality. Most classical liberals hold a minarchist position on politics, believing that the State should be limited to narrowly-defined activities such as police, courts and military. How to keep the State within those boundaries has never been satisfactorily answered.5

A Socialist has just opposite view. Political equality must be accompanied by complete economic and social equality, and the “classical” liberties have to be sacrificed to achieve this end. Attempts to achieve the socialist nirvana of an egalitarian, classless society led to the harshest repression ever experienced in human history in Russia and China. These countries finally abandoned their experiments after tens of millions of lives were lost and with no progress toward equality (or toward the “withering away” of the State). The only approximation to equality was the widespread misery inflicted on everyone who was not part of the ruling class.

A Progressive Liberal will argue that they occupy the “middle ground” between the extremes of Capitalists on the Right, and the Socialists of the Left. They favor a “trade-off” between liberty and equality, so that wealth inequality is, if not completely eliminated, at least mitigated to some degree. However, despite the fact that Progressive policies have been in play in the U.S. for about a century now (fiat money, progressive income tax, cartelization of the banking and medical fields, labor laws, “environmental” regulations, etc.), the statistical measures of economic status are showing a widening inequality in net worth and incomes, not a narrowing. Those who are “connected” politically are doing much better financially than those less politically astute.6 The Progressives have gotten a taste of absolute power, and as Lord Acton predicted, they are becoming absolutely corrupt.7

The status quo leaves a lot to be desired in terms of “equality”. The egalitarians have argued that political campaigns should be financed solely out of public (i.e., taxpayer’s) money, so that candidates have an equal amount of money to spend. This has problems an eighth-grader could take apart: include all third parties, no matter how small, or just the two major parties? How is that fair? Or pay them for the next election amounts proportionate to the vote totals received in the prior election? How would that bring about political “equality”?

Would they also argue that opposing attorneys in a legal case be paid the equal amounts to achieve equal access to justice? I somehow doubt the Trial Lawyers Association is ready for that kind of “reform”. (BTW, if everyone could afford Lindsay Lohan’s attorney, we wouldn’t have to build jails and prisons!)

It doesn’t take long to point out the fallacy of “equality under the law” in any conceivable political system. One of the hallmarks of politics, whether pseudo-Socialist or crony-Capitalist or anything in between is that the ruling class explicitly exempts itself from the laws that it forces its “citizens” to live under. For example, it is against the law for you and me to commit murder; but the State may slaughter their own (or another country’s) citizens by the millions. And you and I cannot extort money from our neighbor for “protection”, but the State does exactly that to all of us. And creating your own money is the crime of counterfeiting, but when the State does it through its Central Bank (a.k.a., the Federal Reserve), it’s “saving us all from the excesses of Capitalism” (while lining the pockets of its allies in the large banks). They even have a double standard when it comes to “insider trading”: the U.S. Congress has exempted its own members from prosecution for this. And why is it a crime to lie to a Federal official, but perfectly OK for them to lie to us? If you still harbor illusions about “political equality” (or the other oxymoron “political freedom”), view Stefan Molyneux’s podcast The Story of Your Enslavement.

My final thought has to do with something that has become quite an intellectual fad in our own day. I am referring to the big whoop-d-do over “diversity”. Diversity is celebrated by the exact same people who would bring about “equality” at any price, apparently not realizing the contradiction. What contradiction, you say? Well consider: Diversity means differences does it not? And to be very precise (because my training is in mathematics), those differences are nonzero differences, i.e. inequalities. So it’s not just liberty that needs to be sacrificed to achieve “equality”, it’s diversity as well.8

Q. Since you argue against the concept of equality (except in mathematics), you must be in favor of de facto inequality, right?

A. It doesn’t matter what I’m in favor of or opposed to. Facts are facts. For instance, show me two objects that are equal in mass.9 Even if there was a technology to form two objects with the same number of atoms and the same chemical bonds, the number of heat quanta would continually fluctuate faster than they could be measured. Any attempt to measure and equalize the number of heat quanta would be impossible according to our current understanding of the Uncertainty Principle. (My apologies to the Physics-impaired.) Face it. We live in a Universe of inequalities.

Q. So instead of “equality under the law”, you would subject us all to “private justice”?

A. But the number of private security guards (“rent-a-cops”) now exceeds the number of “official” Cops, and they commit far fewer home invasions, murders, and larcenies. Have you noticed that they are also much more polite? Also, more disputes are now settled before private arbitration panels than through civil courts (at far less expense and time). So “private justice” is taking over already despite the fact that those who use its services have to pay for them and get no rebate on their taxes. In a completely voluntary society, it would be perfectly permissible for any group of people to put together a “justice system” of their own choosing, even one with all the medieval horrors and inefficiencies of the current State-imposed system. The only thing that those incorrigibles wouldn’t be able to do is impose their wretched system on the rest of us. You would be free to choose whichever property-protection company suited your needs; or, you could choose to hire none of them, and assume all responsibility for your own protection.

Q. In a “completely voluntary society”, who would build the roads?

A. A citizen of the old Soviet Union might well have wondered, without the State, who will bake the bread? Not living in Freedom injures the imagination, making one fearful about one’s ability to live without Big Brother. Security, justice, money, and infrastructure are all products that can be built on a completely voluntary basis by private profit-seeking companies, and will eventually replace the inferior products and services foisted upon us by the coercive State.10 More details (and plenty of links) can be found here.

Q. Apply your thinking to a current, specific issue. Do you favor or oppose marriage equality?

A. Fundamentally, marriage is a contract between two (but possibly more) people to share property and form a long-term economic union, often under a single surname. The union may or may not feature the birthing (or adopting) and raising of children. No one should have to obtain a State-issued license to enter into such a contract. Whether people are “validly” married is a matter for the people involved to determine and proclaim. Only they have a say in the matter, not “society”.

Notice that the previous answer does not in any way make mention of “equality”. Nor does it even require any discussion of “sexual orientation”. Freedom is what is at issue, not “equality”.

The concept of equality is a great distraction for social thinkers, leading them to sacrifice personal freedom on the altar of an impossible, unrealizable goal. If you can’t give up on the concept of “equality”, then become a mathematician, because mathematics is the only place where equality has any real meaning. Who needs equality? Mathematicians. That’s who.

1 Set theory and predicate calculus are two places where one can avoid using equality and equations for at least a little while.

2 Let’s ignore for the moment that before the Federal Reserve was put in charge of “stabilizing” the value of our money, a beverage could be bought for $0.05. In fact, in New York City around the turn of the 20th century, taverns would charge $0.05 for beer and throw in lunch.

3 Anybody still feeling confused about this should consult a reliable treatise on economics. I highly recommend Ludwig von Mises’ Human Action.

4 The term “egalitarian” comes from the French word for equality: egalité. It is part of the French national motto: “Liberté, Égalité, Fraternité”, which in turn came out of the French Revolution.

5 Former Texas Congressman Dr. Ron Paul contended with this problem all through his political career. Despite being wildly popular on college campuses, his ideas never got very far in Congress. In some recent interviews, he seems to be fairly sympathetic now to voluntaryism.

6 There are many things that would lead to better income distribution that would go against the politically connected and so won’t get done: 1) tort reform, to institute a “loser pays” policy would help alleviate high medical costs, as would 2) the un-cartelization of the insurance industry which could be done using Congress’ constitutional power to regulate interstate commerce (to get rid of all the state Insurance Commissioners who keep competition out of their states) and, for good measure, 3) the de-licensing of all medical personnel. And finally, much of the widening gap in net worth in recent years is due to the “bubble” in financial assets caused by the Ferderal Reserve’s Zero Interest Rate Policy (ZIRP) intended to stimulate the economy. Like most manipulations of the economy, it is justified as a measure to help out Main Street, but it just ends up helping Wall Street instead (until the “bubble” bursts, of course).

7 Anyone failing to take notice of the fascistic tendencies of the recent administrations is simply not paying attention.

8 Ironically, one of the main arguments in the early 1800’s for establishing a public school system was to counter the diversity of private schools. And, by the way, literacy rates were higher when all the schools were private compared to now.

9 A statistical argument can be made that even for objects with more than an Avogadro number of atoms in them, coincidental equality is likely to occur many times in the Universe (the so-called birthday paradox). But this is theoretical; I am willing to bet that no demonstrable instances of mass equality will occur.

10 One obvious example of privately-issued money is the release of Bitcoin by “Satoshi Nakamoto”.

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