Government - inept, corrupt, morally bankrupt

As a libertarian leaning person, my general philosophy is that government should only handle the important stuff in an economy.

Why ? The answer has 3 parts. Firstly, governments are not comprised of super-intelligent people, free from errors, corruption and stupidity. Governments are full of people. Its natural that they make mistakes. Only the foolish and ignorant would think otherwise.

The last century has seen people living under totalitarian governments who have put their own survival above the rights and freedom of the people it governs. Also, despite what many journalists and anti-globalisation activists believe, the free market has driven our living standards and almost entirely killed off poverty as we know it in the developed world. The free market is just letting people pursure their own selfish goals. (I use selfish in the most objective sense, not as judgement of whether a persons goals are noble or not but to describe how people follow their own values to acheive their own goals)

Nowadays, poverty is considered struggling to work hard to raise a family, pay the bills and pay medical expenses. Even the poor are rich by past standards. So what these anti-globalisation activists are really complaining about is that there is inequality in our society. I'll discuss this later.

And secondly, but more simply - if you get government to focus on "the basics" such as security, police, roads and a minimum standard of public health care, then they can be held more accountable and are more likely to do their job well.

This second point cannot be emphasised enough. At the moment, the Australian government is responsible for so many different programs at once. Workplace relations, aboriginal relations, regulating property markets, anti commercial legislation, managing our national telco Telstra, subsidising farmers, protecting local producers with tariffs, taxing petrol etc etc etc etc you get my point. So no matter which party is in government at the time, rest assured, it will be busy pulling several thousand levers and making many decisions in the course of its rule.

When we go to the poll booths every four years, there are not nearly as many political parties as there are government programs. We usually only get to choose between 2 major parties, and a few minor ones. Between the millions of voters, it would be very rare to find any 2 people who have the exact same beliefs. People disagree on how things should be run. Some people like myself think the government shouldn't be running 90+% of those things at all. Everyone has different priorities and values.

The problem here is that once a party wins enough votes to cross the line and form government, it gets to pull every single lever however it sees fit. It makes decisions for all of us, using our taxes and subjecting every one of us to a set of policy and regulation.

My point of view is that any realistic person must realise that the democratic process is not ideal for every single citizen, and the point of voting simply becomes "voting for the lesser evil". My original point was that government is less accountable when it pulls a thousand levers. The government may have been very well aware of the AWB scandal, may have implemented hundreds of disastrous and wasteful programs, may promise to implement even more wasteful programs in the future to subsidise people having children, but in the end, all they have to do is remain more popular than the other parties to keep in power.

When the public hospitals, schools or Centrelink offices are in disarray and fail to provide a decent service to people, there are no market forces to make them accountable. The only way to hold the public sector accountable is to lobby the government, draw attention to the failure through the media, and hope that it will cause people to vote the other way. The government in power, if it wants to survive, attempts to remedy the problem to save face. But the only chance this can happen is if it risks losing a lot of popularity over the problem.

Take a private school. They have to compete against other private schools and public schools for your money. If they provide a bad service, you stop purchasing education from them. Instant accountability with no lobbying or media coverage needed. Take a private telecommunication carrier. if they overcharge you on your bill, or provide poor service - disconnect. The free market has mechanisms to reward the successful and punish the failures.

The libertarian ideal is where government runs the basic functions. When it screws up national security, police, law enforcement, or can't even provide very basic healthcare, the media will seize on it and people can take those few mistakes and use it to vote for someone more competent at the next election.

And thirdly, people should never doubt the ability of the free market to acheive grand outcomes. Personal computers, cars, medicine, space travel, television, internet, clothing, fashion, cinema, music, mobile phones and more. These things have come about because of the free market. Because entrepeneurs took risks and pursued goals that would profit themselves.

Recently, a friend told me that my way of thinking shows that I don't want to help the poor. I was told I want to stop government from helping those who need it. Actually, my thinking is to actually stop government from doing more damage and harming the poor. The only thing the government has done is create dependency and welfare traps. Government outlaws all jobs below the minimum wage and creates building regulations that price poor people out of the property market.

My understanding of economics gives me a very strong and unshaking belief in the free market, being something that is fueled by savings. Left-wing types think discussions about money are about greed, selfishness and materialism. But for me, money is just some arbitrary medium which can be exchanged for real resources. If people have more money, they can command more resources.

It can be used to employ others by buying goods and services off others. The theory that greedy fatcats store all the wealth under their mattresses is not realistic. Rich people spend more on food, cars, clothes, property, service, medicine, travel. This goes towards other people.

Wealth spreads itself out in a free market. Producing the first automobile ever took a lot of research and development. Once it was made, it was very economical to mass-produce it and the dream of car ownership has now been realised by billions of people.

The more wealth there is, the better society is. Hundreds of years ago, no matter what system of government, there was widespread poverty and very little wealth. The reason that so many people live well nowadays is because so much wealth is generated in free-market modern economies. Call it indirect if you want, but don't underestimate its impact.

And the free market often helps the needy in direct. Look at how many billion dollars of voluntary aid was raised after the boxing day Tsunami! Much more than governments donated.

On a final note, the last century has shown what happens when governments try to eliminate inequality AND control everything. Communism has brought about widespread famine, poverty and despair whilst killing millions. Ludwig von Mises correctly predicted that communism would fail because it would only succeed in destroying wealth... everyone is equal, because everyone is poor (except for the privileged few who had party connections).

Yet on the other hand, the wealthiest countries in the world are the most free.