Tax Reform
Why I Fear Capitalism

Why I Fear Government

By John Morton

Several years ago, economists from the University of Arizona and Arizona State University and I conducted a study to see if more knowledge of economics influenced high school students’ views about markets and government.  We administered the Test of Economic Literacy accompanied by a survey assessing attitudes on government and market solutions to problems.  We found some positive correlations between economic knowledge and pro-market approaches, but the big finding was that the more important an issue was, the more the students wanted to rely on government solutions.  We also found that the wealthier a ZIP code, the more the students favored government solutions rather than market solutions.

David Friedman (The Machinery of Freedom) states that “there are essentially only three ways that can get another person to help me achieve my ends: love, trade and force.”  Love works for small groups like families and for cooperation when people share a common goal.  Trade does not require love. Instead, trade helps you achieve your goal if you help me achieve my goal.  It is voluntary.  The third method is force.  Do what I say or I will punish you.  The alternative for people who criticize the selfishness of markets is government.  This is force whether the government is autocratic or democratic.  It is foolish to give a politician power and believe political power will be used only for good.  Check out the swamp in Washington, DC.

In The Bourgeois Virtues, Deirdre McCloskey puts it like this:  “Anyone who after the 20th century still thinks that thoroughgoing socialism, nationalism, imperialism, mobilization, central planning, regulation, zoning, price controls, tax policy, labor unions, business cartels, government spending, intrusive policing, adventurism in foreign policy, faith in entangling religion and politics, or most of the other thoroughgoing 19th-century proposals for governmental action are still neat, harmless ideas for improving our lives…is not paying attention.”

Matt Ridley put it succinctly in an article in the fall 2017 Journal of Private Enterprise: “The market gave us prosperity and innovation, while government gave us Stalin, Hitler, and Mao, so why are people so forgiving of the state and so mistrustful of the market?”

Ronald Reagan said that you should run from anyone who makes any of these statements:

  • Certainly I will respect you in the morning.
  • The check is in the mail.
  • I’m from the government and I’m here to help you.

Comments

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The headline of this post makes a claim entirely unsupported by the body. I thought, in something headlined 'Why...', that I'd ready actual arguments, as opposed to whatever this is.

Screeds of this sort always bring me back to the same notion. I don't doubt that there are Americans in the 21st century for whom government is their biggest problem. I'm sure this is so. Keep in mind, however, that those people are the envy of the rest of us.

I get that the end of the Soviet Union and the 2008 financial crisis have left a lot of professional market fundamentalists a bit adrift. It's a bit ironic, really, since the difficulty of adapting one's skills is a classic labor market failure...

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