Parenting the Government

Governments version of the Magic Roundabout.

Okay. If you tried this ploy on your parents, you wouldn’t get away with it.  If your kids tried it on you, you wouldn’t fall for it either.  So why are the American people letting the Government get away with this ploy?  I don’t know. And I don’t get it.  Maybe there is just so much going on that it gets lost in the mix. Maybe it’s because of the deceptive and disingenuous way it’s being presented by Pelosi, Reid, and Obama.

Here’s the ruse:  “Give us more of your money today, and we will reduce tomorrow’s health care costs. We will increase efficiency.  And we will do all of this without increasing the budget deficit!”

Yeah, right.

What exactly is stopping them from reducing health care costs and improving the efficiency of health care delivery now? Why do they need more money today to accomplish these things tomorrow? What magical powers does the next dollar of tax collections have that the current ones don’t?

Exactly.  None.  So when Congress asks to increase taxes and the deficit in order to fix health care tomorrow, let’s respond to them as we would our clever but errant children: Ask to see some proof today first.

You know how that will turn out. And so does Congress.  That’s why they just keep promising the moon.  What I don’t get is why we continue to let them get away with it.

[Not just the US Government plays on the roundabout – I’m sure they learnt from the Brits! Ed.]

By Sherry Jarrell

7 thoughts on “Parenting the Government

  1. Agreed about too much taxes without adult supervision…

    Now something related to think about. Why not make American freeways private? The US government could sell the Interstate system, making lots of profits (are not profits the best thing?), then the private owners would make even more profits. No more taxes to pay for the roads, etc… One could extend that to the army. Make the army completely private, headed by the operators of the ex-Blackwater, I mean “Xe”. Army guys would be encouraged to make profits, as their predecessors in France around 1200 CE (interestingly called “Les Grandes Compagnies” = The Great Companies”).

    And so on.
    In France, freeways are actually private, and toll. But of course they were built and paid for by private capital (protected by law recognizing them as of “public utility”). It works well, nobody is complaining: superior surfacing, no holes, no debris, and advanced freeway architecture, differently from American freeways.
    The high speed train network is according to similar lines.

    Superior economic organization is all within that concept of PUBLIC UTILITY.

    Profit is not the superior economic organizing principle. Public utility is.

    Pirates made profits, so did Roman governors and Persian Satraps, or Carthage.

    The USA can learn a lot from its sister republic, France. Another example is waterworks. Starting around 1850, private water companies grew in France. They soon became extremely profitable, and several private French water companies are now the largest water companies in the world.

    This worldwide success did not escape the attention of typically suspicious French citizens. Some city engineers noticed that they could do the same cheaper. So, paradoxically, a rebellion against the French water giants has started in France, and some city governments are now running, cheaper and better their own waterworks, after wrestling back control from the private water giants.

    It is not whether it is private for profit or government for public which matters. what matters is the maximization of public utility. At least in a democracy. In a banana republic, it’s different, true.

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  2. Patrice: Just to clarify before I comment, by “public utility” you mean the benefit of the whole of the public? And your focus is on what is being delivered or consumed and how much good that does for the citizen?

    I assume your point is the superiority of government supplied goods and services — specifically as it is done in France — over the profit motive of private companies. Again, you miss the point that the government would have no resources to spend without private industry. All the government does is to shift profits around in the economy. Now some of that shifting, like from private profits to public goods (and by public good I mean one where the consumption of the good by one individual does not reduce availability of the good for consumption by others; and that no one can be effectively excluded from using the good, like clean air, national defense or, effectively, a national interstate roadway system), is necessary and desirable. We, as a country, defined the need for public goods in our Constitution, but we have strayed very far away from that ideal over time, to our detriment.

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  3. Hi Sherry:
    I made several points. Indeed by “public utility” I allude to public as in res-publica.
    Funny you said that a “national interstate roadway system” should be paid by taxes. As I said, in France, it’s private, and paid by the proverbial ‘end user’. So much for France being socialist and USA private profitist. Please forgive the neologism.

    I gave the example of waterworks. Private French companies lead worldwide in that domain. That means French (local) government use taxes to pay them. But recently some government realized they could get more services by doing the work themselves. So, in this case, they start as before: taxes. But then, instead of paying some giant private French water company, they pay municipal workers and engineers to do the work. Cost less (less taxes), better service.

    Call that an anti-Jarrell universe. A mystery, like anti-matter. How could that happen? Very simple: think about it: the municipal government does not have shareholders (just stakeholders) and does not have to pay dividends, and does not have to increase the value of the shares by showing profits. It actually has no profits to make. So the end user (the denizen of said city under his city government) saves money (i.e., taxes), improves services.

    This example, of course carries to health care. France has also a competition of public and private health care systems, large pharmaceutical companies, etc… And has done more face grafts (in public hospitals) than the rest of the world combined… and the first successful gene therapies (also in public hospital), etc. Was is it not to like? If profitist ideologues in the USA were not so greedy, they would see the necessity of having a strong public sector, be it only to keep the private sector honest.

    By the way, French politicians are regularly condemned for corruption, and it’s not because they are richer than their colleagues in the USA, by a long shot…

    Patrice

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  4. Ah Patrice….here we go again! For one, I did not say that government “should” pay for a national highway system, I said that we do pay for a national highway system. A positive statement, not a normative one.

    I guarantee you that in any universe – not just the Jarrell one – the true cost of anything paid for by the government with tax dollars is understated by several orders of magnitude. And, possibly, overstates benefits. It is simply factually incorrect to say that the cost (the true economic cost as measured by the use of resources) of providing the service is less when provided by the government. The one-period ACCOUNTING cost put on paper by some government office, as reported to the press, and swallowed whole as fact by readers, may be less. But it is literally, factually impossible for the true costs to be reduced by inserting a redistributive middleman between consumers and business.

    You also fail to understand the relationship between stock prices and economic value. You should step back, slow down, and consider the following. Let’s get dollars and stock prices and dividends and profits out of the equation entirely and just think about the amount of goods and services provided versus the amount of resources used up in the production of those services. Measure it however you want — quality of life, health of the citizenry, happiness, kumquats. Now ask yourself which is the most “efficient”method of providing final goods and services, where efficiency is measured, as it should be, as the number of units of output of the good and service provided per unit of resources used up in production process. The “dividends” and “capital gains” in this analogy are the EXTRA value created from a capitalist system; take one input, create 2.5 outputs, added value is 1.5. The government as provider creates zero extra value, if we are lucky, and negative value, if we are realists: take that same input, chew up half its value in bureaucracy, buying votes, and redistributing the consumption decisions of a free people toward something they would not choose to purchase in the first place (otherwise, why the government program in the first place?), and produce 0.5 total outputs, a loss of 0.5. The social loss from moving from capitalism to collective command and control is 2: from plus 1.5 to negative 0.5.

    Yes I am including spending on defense and clean air and roads. When we spend on collective goods, we use resources less efficiently. This spending infringes on our economic freedom, but some goods and services are necessary to protect and preserve the system that enables that economic freedom.

    You and I can and most certainly do disagree on where to draw the line on what goods and services the government should provide over the objections of a free people, but we cannot disagree on facts. Your claim that government provision of goods and services is less costly than private industry is factually incorrect.

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  5. MOTORWAYS IN FRANCE?

    Sorry, it is absolute rubbish. Making them private means you have to pay a toll. Rich people have no problem, poorer people do. The motorways in France are now getting quite expensive. Result? Poorer people don’t drive on them so much. Great for the rich; they have empty motorways. And of course, motorways are SAFER, so fewer rich people die. It actually STINKS. All roads should be centrally financed and available to all. Otherwise you have in fact an kleptocracy. I detest the London congestion charge for the same reason? It simply makes the roads emptier for the rich. Great. Very democratic.

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    1. Hey Chris — I was not sure if you were directing your comment to me or to Patrice but after reviewing the stream of posts, I think you are referring to something Patrice said. Either way, I’d like to add my support for your observation.

      I view roadways as an example of a public good, like defense, that should be paid for by the government, even though the actual cost of doing so is higher than the reported costs of materials and labor. The benefits, as you point out, are likely higher as well because, if left up to the private economy, we would have no interstate highway system. We would have a patchwork system of toll roads that would be unsustainable by the private economy.

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