Government

Why Doesn't The Government Order Us Around More?

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Economist Bryan Caplan contemplates how government does most of its coercion second-hand:

Here's an odd thought for a libertarian: The government very rarely tells me to do anything…

Dr Case / Foter / CC BY-NC

How is this possible when the government regulates almost every aspect of American life, and takes 40% of GDP?  The government controls the labor market (especially for foreign workers).  The government decides what products I can and can't buy.  The government runs a massive retirement system that I can't escape without leaving the country.  How can the government control me so thoroughly yet so rarely boss me around?

The answer is simple yet shocking: Government controls me by controlling my trading partners.  Government doesn't tell me to pay sales taxes; it just forces every business in Virginia to collect sales taxes as a condition of sale.  Government doesn't tell me who I can and can't hire; it just tells every business I deal with who they can and can't hire.  Government doesn't even tell me I have to contribute to Social Security; it just requires my employer to make contributions on my behalf as a condition of employing me….

He considers, but dismisses, the idea that this is merely because it's cheaper for the government. Then:

Governments rely on indirect coercion because direct coercion seems brutal, unfair, and wrong.  If the typical American saw the police bust down a stranger's door to arrest an undocumented nanny and the parents who hired her, the typical American would morally side with the strangers.  If the typical American saw regulators confiscate a stranger's expired milk, he'd side with the strangers.  If the typical American found out his neighbor narced on a stranger for failing to pay use tax on an out-of-state Internet purchase, he'd damn his neighbor, not the stranger.  Why?  Because each of these cases activates the common-sense moral intuition that people have a duty to leave nonviolent people alone.

Switching to indirect coercion is a shrewd way for government to sedate our moral intuition.  When government forces CostCo to collect Social Security taxes, the typical American doesn't see some people violating their duty to leave other people alone.  Why?  Because they picture CostCo as an inhuman "organization," not a very human "bunch of people working together."  Government's trick, in short, is to redirect its coercion toward crucial dehumanized actors like business (and foreigners, but don't get me started)…

Of course, if the public fully absorbed the implications of common-sense morality, the government's ruse would fall flat.  The public would look at the vast majority of business regulation and say, "So a bunch of people are using their own skills and their own resources to make money.  How on earth does that vitiate your duty to leave nonviolent people alone?"

Caplan has been a pal of mine since the early '90s, and he's a very decent man in my experience. His very decency leads him a little astray here in his assumption that too many of his fellow citizens are similarly decent.

I've learned from years of writing about what I see as horrific government assaults on the innocent that a very, very typical reaction–even among the types inclined to be reading Reason in the first place–is along the lines of: if that person just did what they were ordered to do, they wouldn't have had the government harm them!

Some sick innate desire to see everyone just obey often trumps that moral intuition about not harming the non-violent–even among people who agree with the meta-point that the order shouldn't have been made in the first place.

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  1. “Political tags ? such as royalist, communist, democrat, populist, fascist, liberal, conservative, and so forth ? are never basic criteria. The human race divides politically into those who want people to be controlled and those who have no such desire. The former are idealists acting from highest motives for the greatest good of the greatest number. The latter are surly curmudgeons, suspicious and lacking in altruism. But they are more comfortable neighbors than the other sort.” -Heinlein’s Lazarus Long

  2. Switching to indirect coercion is a shrewd way for government to sedate our moral intuition. When government forces CostCo to collect Social Security taxes, the typical American doesn’t see some people violating their duty to leave other people alone. Why? Because they picture CostCo as an inhuman “organization,” not a very human “bunch of people working together.” Government’s trick, in short, is to redirect its coercion toward crucial dehumanized actors like business (and foreigners, but don’t get me started)..

    Wow, that is a depressingly insightful point.

    1. KORPORASHUNS ARE NOT PEOPLE

      1. AND GOVERNMENT IS THE ONLY THING WE ALL BELONG TO

        1. Some people have this yearing for a larger social entity to belong to. When they are conservatives, they latch onto church groups, when they are liberal, they latch onto the federal government.

          1. This is why, as an agnostic, I’m a huge supporter of organized Christianity.Churches are voluntary.

    2. I’ve long had this thought about income taxation and withholding. If on April 15th, a tax collector knocked on everyone’s door and said, “Gimme $15,000” (or whatever) there would be riots. Even if they said, “OK, you can pay it in quarterly installments…but you have to pay us extra, in advance” it would get ugly.

      But when it’s taken out of your hands? Your employer is not going to stick their neck out for your beliefs, and why should they?

      1. Not April 15th. The first Monday in November.

      2. This is why I consider Milton Friedman to be an enemy to liberty, no matter what positive other things he did. He invented an insidiously perfect way for the government to hide what it steals from us, which in turn allowed the government to grow far faster than ever before. He is one of the reasons we are where we are today.

        1. He was young and did it to try to combat inflation during WWII.

          It was a mistake of youth.

        2. A guy sucks ONE dick…

        3. The entire Chicago school was in the pocket of the New Dealers in the 1930s and 40s. One thing though that has been an allusive detail for me to really pin the blame on Friedman is what was his function in the government at that time? Was it his idea that traveled up the chain of command and got the backing of NY FedRes Chairman Beardsley Ruml, or was it the product of a concerted group think by Treasury Dept. flunkies of which Friedman was a member?

        4. You hate Candyland?

          Oh, wait…Milton Bradley.

          1. He’s more a “Mystery Date” man.

      3. When withholding was instituted, the government simply wrote off all of the 1942 income taxes that would have been due April 15, 1943. But since 1943’s taxes were now flowing into the treasury as the income was earned, the government was able to keep going.

        That lost year of income means that we’ll have a hard time abolishing withholding. For example, if we decide that 2013 will be the last year for which taxes will be withheld, that will mean that the government’s cash flow will dry up between December 31, 2013, and April 14, 2015 (which the payments for 2014 will finally come in). I’m not sure that having the government issue debt in the amount of nearly $4 trillion to serve as a bridge loan would be a great idea. The alternative, though, would be for the year (1942) for which the government got no income tax revenue to be balanced by a year for which the government gets two years’ tax revenue in one–in effect, in which the American people pay twice (e.g., they get 2013 taxes withheld throughout 2013, plus they pay them again on April 15, 2014). That’s obviously an ever worse idea. So until the United State government ceases to need tax money, we’re basically screwed.

    3. Switching to indirect coercion is a shrewd way for government to sedate our moral intuition.

      Inclined to agree with your misgivings Brian, but I have to give kudos to Caplan there. That’s a brilliant point he makes and elaborates on, like a later day Georges Sorel.

    4. They also reverse zero-sum: nearly all private transactions are win-win; nearly all government transactions are zero-sum. Yet too many people constantly approach it in the exact opposite way.

      1. nearly all government transactions are zero-sum

        Disagree, most government transactions are lossy.

        Zero sum wouldnt be so bad.

  3. It’s called a social contract. Once you were born into this cruel world, the state has been there to protect and nourish you. Why the very roads you drive on and the air you breathe is only there because of government oversight. How could we live without our glorious masters? We owe them our very living and a few so-called libertarians rattling their little cage will make no difference.

    /derp for the oblivious

    1. I really likes what another commenter had to say on this earliet:

      “Look, it’s either your signature or your brains that go on this contract.”

    2. I really likes what another commenter had to say on this earliet:

      “Look, it’s either your signature or your brains that go on this contract.”

      1. 15:00 squirrels.

        1. Either your signature or their acorns are going on this server.

  4. Penaltax FTW!

  5. Caplan has been a pal of mine since the early ’90s, and he’s a very decent man in my experience. His very decency leads him a little astray here in his assumption that too many of his fellow citizens are similarly decent.

    That may be so, but I think his point still has some validity. The only way the government can watch us and control us in so many ways is to force businesses to accept the outsourcing of things the government wants to do. It forces banks to scrutinize our money patterns; it forces employers to withhold Social Security and income taxes; it forces pharmacies to watch for purchases of certain drugs; and so on. It could never do all these things itself; it doesn’t have the manpower. But what it does have is a monopoly on force, and it can use that to force private actors to essentially become part-time government contractors.

    And so people don’t see it as the government doing it, because technically it’s not. It’s businesses doing it, because the government has put a gun to their heads.

    1. Exactly. If a constitutional amendment, say, were enacted to make withholding illegal and to require government to directly collect income tax from taxpayers. . .well, I think even today’s sheep might revolt. Crap, even for me, aware of what’s going on, writing a check for what I pay out would likely rage me out into some sort of giant, green Warty analogue. As it is, I merely simmer on high heat.

      1. I self medicate…keeps the wife happy.

      2. See my above comment about the inventor of that withholding. And you’re right.

      3. We self-employed folks get to write a check for federal income tax plus two-times the FICA rate every quarter. It’s no fun, but better than the awful consequences of non-compliance.

        Self-medication is essential to the process for me.

        1. That’s a good point–why aren’t you in the streets?

          1. Where Cato lives – they don’t NEED roadz

      4. “No third party may collect or withhold tax monies for a government. Direct employees of the goverment must present a bill of Tax not fewer than 90 days before such tax is due. All Federal elections must be held the day following the date at which the previous year’s tax bill is required to be settled for the majority of citizens.”

    2. The other thing is that it coerces fewer people who have more to lose. If they tried to force people to withhold their SS taxes, it would require forcing hundreds of millions of people to do something. That is a lot harder than forcing every business to do it. More importantly, many people don’t have much to lose and would rationally choose to take their chances not paying the tax. Once enough people did that, the law would quickly become unenforceable and no one would pay.

      You could not have an income tax in this country if you collected it directly from the individual.

      1. You can, it would just have to be really, really low.

        1. Yes. It would have to be very low and the penalties for non compliance very draconian.

      2. Yeah you could. It would just have to be a smaller tax and only on higher incomes. Kinda like before the practice of withholding.

      3. Actually, let me rethink that. Yeah. It would work. What do self employed people do? Their tax is not withheld. I mean, it’s pretty simple. Pay up or they steal everything you own and lock you in a cage. People would pay.

      4. And if businesses decided, “screw it employee, figure out your taxes yourself”, people would now be pissed at the hand that feeds them instead of the hand that bites them.

    3. I think you missed the point of what you quoted. Doherty was saying that Caplan gives his fellow man too much credit with their common-sense morality, as opposed to disagreeing about indirect coercion.

      Totalitarian police states exist because people will allow abuses to occur. Our system of indirect coercion only hides that the coercion is happening. If it was direct would people object? Yeah. But they’d do it privately. It’s difficult to provide for your family if you’ve been disappeared for speaking out, so people just take it.

    4. This whole scheme also encourages major cronyism too. After all if you can’t beat ’em, why not join ’em?

    5. But what it does have is a monopoly on force, and it can use that to force private actors to essentially become part-time government contractors.

      Force? Force?

      Look how many non-government actors are happy to turn their neighbors in because they’re firing an airsoft gun. Too many people in this country are happy to fill the role.

  6. Whose face is hello kitty holding? Is it Obama?

    1. It’s Andre the Giant. The use of whose image is the signature shtick of Shepard Fairey, the edgy “street artist” who brought us the wonderfully creepy “Hope” Obama poster and this uber street line of yuppie clothing:

      http://www.obeyclothing.com

      1. The first time I saw an OBEY shirt, it was so similar to the signs in They Live that I thought “this dude has a They Live t-shirt?!? That’s awesome!”

        Then I started to see more, and they were always on hipster douchebags, and I realized that there was no way it was a They Live reference.

        And Fairey totally ripped off They Live (the fonts are just too similar, the look too much the same), but the dumbass hipsters are too stupid to realize that.

        1. Still one of my all time favorite lines and execute perfectly by Piper: “I have come to chew bubblegum…”

          1. Ad libbed by Piper.

            1. The greatest American from Canada. Other than the Shat, of course.

              1. Maybe third greatest, as long as Natasha Henstridge still draws breath…

        2. These people should explain it to them. And make them put on the glasses.

        3. What I couldn’t believe (at the time) when I saw those “Hope” posters was that the Obama campaign would use such an obvious nod to soviet socialist propaganda. I always assumed Fairey’s appropriation of the style was meant to be ironic. It all comes around full circle I guess.

        4. One of my favorite South Park moments:

          http://www.youtube.com/watch?v=cWk6RgQbPVc

          Jimmy and Timmy battle it out in the parking lot, the scene is a shot by shot copy of the excruciatingly long fight scene between Piper and Keith David in “They Live”. A lot of you folks probably know this, but when I found that out I laughed my ass off…

          1. CRIPPLE FIGHT!

            Clearly one of the greatest South Park moments ever.

          2. I love finding that sort of thing too. Like the Pinky and the Brain parody of a frame from Watchmen, the Smallerizer subbing for Nostalgia, “S” for “N” like south for north.

            I’m still finding stuff like that on Lost, but the sources are more obscure. Many LOL parodies of shots from the 1932 Universal serial adaptation of The Lost Special. There are much more obvious ones too, like the one from the conclusion of Carrie. Plenty from Watchmen too.

            If you want to laugh nonstop like that, though, check out screen stuff from Millar & Gough.

        5. Considering that Fairey did the Obama campaign poster, I suspect the Obey brand name is not ironic.

          1. And I suspect it is, because I don’t trust him not to have been laughing up his sleeve as he delivered his “Hope”.

      2. It’s Andre the Giant. The use of whose image is the signature shtick of Shepard Fairey, the edgy “street artist” who brought us the wonderfully creepy “Hope” Obama poster

        Has anyone combined the two images? Seems like a no-brainer.

  7. Take the annual federal budget. Divide by the polulation. Send that bill to everyone. We would have much smaller government.

    1. Divide by population?

      Sorry son, You pay your own bill I don’t care that you’re seven and can’t get a job.

      1. Parents are legally responsible for the acts and debts of their children…

        1. I figured that would be the case.

        2. I don’t like that one. What if your kids are constant screw-ups who don’t care how you punish them? You can’t start cutting off fingers when they keep stealing stuff because that’s abuse. You can’t lock them in a room 23 hours a day, either, because that’s abuse. Parents need to be able to abandon their kids (and all responsibility for them) at any age and kids need to be able to abandon their parents, taking responsibility for themselves at any age.

    2. “Fair share”, Baby!

    3. I like that plan. Pay your first 10,000 bucks (380 million times 10K is 3.8 trillion) and you don’t have to file a tax return or pay any more. Burden the nation with five kids, and pay 50,000 into the coffers. Then let everyone vote on what they want the federal budget to be and see if there is really “nothing left to cut”.

      1. Isn’t it closer to 310 million?

    4. Take the annual federal budget. Divide by the polulation. Send that bill to everyone.

      Set next year’s budget to equal the amount received. Repeat.

      After a few years, we would have a right-sized government.

      1. Before or after the pitchfork revolution?

  8. His point all boil down to the fallacious difference between commercial and non commercial activity.

    1. Not exactly. Take a sole proprietorship business.
      Lots of people will feel squeamish about compelling a *person* to do something, but if they stop thinking of it as a person and start thinking of it as a business they have fewer qualms about it. See the Oregon bakery case.

      Are you (a) forcing two people to do something they feel violates their beliefs, or (b) forcing a business to treat gay people equally.

  9. “Government controls me by controlling my trading partners.”

    This is precisely why government prefers large corporations and large labor unions. It makes controlling you much, much easier and uniform.

  10. Americans want to believe, and are indoctrinated in that belief since grade school, that their government is different and special and “limited” and fair and democratic. People don’t generally side with tax avoiders when they get caught, they want everyone else to pay up like they are forced to themselves. People don’t side with the raw milk producers or distributors — they want the government to protect them. They delude themselves into thinking that getting robbed twice a month is the price they pay for a government that protects them, even though there would be a lot fewer actual threats to worry about if the government didn’t outlaw drugs or bomb third world fanatics.

    1. it’s theological.

      government serves as a god for the secular left, and country serves as a cult for the religious right.

  11. if your constantly told what to do as a kid, you grow into an adult that like to be told what to do. i’ll call it an ill side effect of humans learning how to domesticate plants and animals, frees up time and resources to order others around. pure liberty can only be achieved with daily subsistence living, so screw it.

  12. “Government doesn’t tell me to pay sales taxes…” Yes, it does. All those no sales tax purchases from Amazon? You’re almost certainly supposed to be reporting them and paying the tax.

    “Government doesn’t tell me who I can and can’t hire…” Yes, it does.

    “Government doesn’t even tell me I have to contribute to Social Security; it just requires my employer to make contributions on my behalf as a condition of employing me….” Yes, if you don’t have someone to take the money and pay it in your name because you are self-employed, it does.

    Further, regulation isn’t necessarily so much about what you are ordered to do, but what you are ordered not to do.

    “Because each of these cases activates the common-sense moral intuition that people have a duty to leave nonviolent people alone.”

    Oh, bullshit. You can’t swing a dead cat without hitting a crowd of people who’d cheer a police raid of a non-violent drug user’s house. For most people, the so-called moral intuition is to side with people acting in a way with which you agree and against those acting contrary. It’s much less about non-violence and much more about “I agree with those people.”

    1. Yeah, the whole time I was reading this, I was thinking along similar lines. The government doesn’t tell me what to do? Say what?

  13. This implicit coercion also comes under the guise of seeming voluntary cooperation as a result of regulatory threats to various industries of “regulate yourselves or we regulate you directly (and harshly)” or actual prior instances of coercion that I’ve mentioned here regarding entertainment, and here regarding sports, and is unfortunately occurring with Bitcoin in the US (the formation of DATA and dealing with the “self-regulated” association of Money Transmitters)

  14. Government doesn’t tell me to pay sales taxes; it just forces every business in Virginia to collect sales taxes as a condition of sale.

    If the population were required to keep records of and pay their own sales tax (or pay according to some government formula) or pay income taxes in one lump sum, you would have open revolts.

    Government employs a lot of stupid people. But a handful of them are not stupid. They are exceptionally clever and driven, which makes them truly dangerous.

    1. “Government employs a lot of stupid people. But a handful of them are not stupid. They are exceptionally clever and driven, which makes them truly dangerous.”

      Excellent quote. Stolen and shared with liberpopulace.

  15. If the typical American found out his neighbor narced on a stranger for failing to pay use tax on an out-of-state Internet purchase, he’d damn his neighbor, not the stranger.

    Why is the neighbor not the typical American? I don’t know about actual numbers for those that ascribe to each position, but I do know a lot of people who think things aren’t fair if someone else get’s away with something that they didn’t, like people complaining about the amount of work someone else is doing when it has no effect on their workload or people complaining that someone else got a prize in the event of a tie in a contest when both people got the same prize that one person would have received had they won it outright. Why do you think there is a call for so much redistribution?

  16. You don’t have to order around the individual sheep, you just get the herd, err flock, moving.

    1. That’s the same strategy terrorists use. Shoot a few at the edges and get the rest running.

  17. “If the typical American saw the police bust down a stranger’s door to arrest an undocumented nanny and the parents who hired her, the typical American would morally side with the strangers. If the typical American saw regulators confiscate a stranger’s expired milk, he’d side with the strangers. If the typical American found out his neighbor narced on a stranger for failing to pay use tax on an out-of-state Internet purchase, he’d damn his neighbor, not the stranger.”

    Um, aren’t we living in the same America where the Governmetn regularly busts down doors and arrests people for consuming unapproved plants? And steals takes property with litte recourse per asset forteiture? And expels little kids from school for making poptarts in the shape of a gun? And feels people up for the crime of getting on an airplane?

    The Government can get away with most draconian policies by making up enemies (drugs, terrorists, guns, etc.). For the rest, they can get a majority of people to agree that punishment is just no mattaer the “crime” because “rules is rules.”

  18. How can the government control me so thoroughly yet so rarely boss me around?

    Without speaking to the finer points of this post… I’m not sure they don’t.

    I suppose it depends what line of work you’re in. But if you have the opportunity to take part in say, a construction project, the government is absolutely telling you what to do, directly, all the time, and forcefully.

    ‘We had to raise that counter up a half inch because it needs to be 42″ according to the code enforcement officer.’

    ‘The first code enforcement officer signed off on the staircase, but the second one walked by and said, ‘you have to cut that end off and replace it with a rounded hook”

    ‘We had to tear out that soffit because…’

    And so on. No, I, Paul do not hear directly from government officials everyday, but every time I’m in a construction meeting, I hear it 100 times a day.

    1. What’s especially depressing is that most of those code enforcement officers probably are citing things that don’t need to be citied just because they need to make it look like their jobs aren’t completely useless bullshit.

  19. I’ve learned from years of writing about what I see as horrific government assaults on the innocent that a very, very typical reaction–even among the types inclined to be reading Reason in the first place–is along the lines of: if that person just did what they were ordered to do, they wouldn’t have had the government harm them!

    Some sick innate desire to see everyone just obey often trumps that moral intuition about not harming the non-violent–even among people who agree with the meta-point that the order shouldn’t have been made in the first place.

    I think Caplan is right on in his analysis of second hand coercion via businesses, but I am definitely not as sanguine as Caplan. I feel even less optimistic than Brian in that I am not sure there are that many “people who agree with the meta-point that the order shouldn’t have been made in the first place”

    It would probably it would be a highly polarized mixed bag if all the coercion were more direct. It would a be more along the lines of “freedom for me and not for thee” and lots of calls for the government to “do something” about someone or something else. It wouldn’t necessarily trump moral intuition but rather form the basis or their own morality. It seems like we already experience this in many states through anti-liberty ballot propositions.

    1. ^ *needs editing*

      1. It was perfectly understandable and well made point.

  20. Explains why small business owners are the most anti-government.

    Guess who all that direct ordering around is aimed at?

    1. Again, this. Try throwing up a few walls in an empty mini-mall space, and see how much direct ordering around you’ll avoid.

      You will have meeting after meeting after meeting where 75% of every single discussion is about code compliance, RFI changes, regulatory compliance etc.

    2. The thing is that business owners, almost by definition, will always be a minority of society. So they make much easier targets.

  21. a very, very typical reaction–even among the types inclined to be reading Reason in the first place–is along the lines of: if that person just did what they were ordered to do, they wouldn’t have had the government harm them! Some sick innate desire to see everyone just obey often trumps that moral intuition about not harming the non-violent–even among people who agree with the meta-point that the order shouldn’t have been made in the first place.

    No, Mr. Doherty, it is not a desire to see everyone just obey, it is a desire to see people not be incarcerated or killed! Is it “sick” to counsel someone to hand over the loot to the armed robber rather than be killed? Or to be raped rather than killed? There is not less blame on the aggressor when we point out that the victim made a bad choice.

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