Regulation

Big Government Is Not Your Friend

Private industry creates wealth whereas government efforts only consume it.

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Advocates for bigger government—just about everyone these days, it seems—believe that government is the most efficient and humane provider of goods and services. It's such a bizarre way of viewing the world, but lessons about the wonders of the free market apparently aren't taught anywhere any more.

The presidential election and ongoing debates in the California Legislature illustrate this frightening phenomenon. Voters chose a candidate who has an undying faith in the power of government and even the Republican candidate failed to clearly explain the most obvious lesson—why free enterprise is superior to government coercion.

I don't like to toss around pejoratives such as "socialist," but what do you call a state Legislature where the dominant majority seethes with hostility toward private firms and does little more than hatch plans to create new government programs?

Yet wherever we look, government fails.

The Sacramento Bee published an instructive article recently about how a federal wildlife agency is gaining contracts to provide pest-control services of the type that private-sector companies already are providing.

One of the basics of government is that it should not do those things that private companies already are doing, but now that government is unlimited no one seems to care about that idea any more.

Many of the costs of Wildlife Services are off the books—i.e., unfunded pension and overhead costs, which makes it seem as if the agency is more cost competitive than it really is. Essentially, taxpayers are footing the bill for something that should be paid for by those who need to contract for those services. And the government is putting private firms out of business.

But the most instructive aspect of this story is how poorly the agency provides the pest-control services. It is notorious for its ham-fisted approach to pest management, including killing of endangered species and a culture in which workers hide such killings. The agency has simply ignored calls by members of Congress and activist groups for reform.

"[Concern] is directed at an agency called Wildlife Services, which is already under scrutiny for its lethal control of predators and other animals in the rural West," the Bee reported. "A … series earlier this year found the agency targets wildlife in ways that have killed thousands of non-target animals, including family pets, and can trigger unintended, negative ecological consequences."

If a private company operated in such a way, there would be accountability—legal efforts to control its practices, civil lawsuits by people whose family pets were killed due to the company's irresponsibility, criminal prosecutions for violations of environmental laws.

But the government doesn't have to live up to the same laws that apply to the rest of us. Instead of having to cease and desist, Wildlife Services goes along its merry way, expanding more deeply into an activity the private market already is handling in a better and less costly way.

As the article pointed out, the federal agency operates in virtual secrecy, which is another hallmark of government endeavors. Here is the Bee again: "'It's been such an uphill struggle,' said Erick Wolf, CEO of a California firm called Innolytics, which developed a form of birth control for Canada geese and pigeons with help from Wildlife Services' scientists in Colorado. …'All they want to do is shoot, trap and poison,' said Wolf. 'They don't want to consider anything else.'"

Government does not have a bottom line so its incentives are different. Government agencies are protected from meaningful oversight. This is why a federal wildlife agency wreaks havoc on wildlife whereas private companies specialize in non-lethal approaches. This is the reason governments often are the biggest polluters.

These days I even hear people argue that government is the best way to provide services because there is no profit motive. That reflects an almost unbelievable level of economic ignorance, but it is a point officials make as they try to use eminent domain against private water companies, for instance.

Businesses need to earn a profit, but the price of its products is determined by competition, which relentlessly drives down costs and increases efficiencies as the less-able providers go out of business. There is no place to offload private costs onto the public in a free market, even though some businesses despicably lobby the government for special privileges and bailouts.

If the advocates for government efficiency were right, then the Soviet Union—where thousands of unneeded tractors rusted in vacant lots as the public waited in line for toilet paper—would have been the most successful economy on the globe. We would all be happily driving Trabants rather than Toyotas, Fords, and Volkswagens.

Private industry creates wealth whereas government efforts consume it. If my neighbor starts a business, he must win over customers without coercion. He can't force them to patronize their businesses or to pay his expenses. Even when government operates as a business, it forces the rest of us to subsidize its operations. Private industry must please the demands of consumers or it loses money. Governments' only customers are politicians and the unions that represent its workers. It's no wonder it provides lousy customer service and shoddy products.

There are no shareholders to please, few incentives to rein in costs, no days of reckoning when it fails.

There are two ways to provide services—through the free market, which energizes private initiative as people freely pursue their own dreams, or through the political world, where government officials take money by force (taxes) and protect government providers from competition. There's a reason the teachers unions, for instance, fight vociferously against charter schools, vouchers, and other competitive systems that would embarrass them.

If we want a humane and efficient and accountable society, then we need less government, not more of it.  Advocates for freedom need to quickly figure out how to better impart these lessons in a society that is bounding toward limitless government.