Sunday, September 5, 2010

A Legislature of far too little impact

Los Angeles TImes editorial "A Legislature of far too little impact" (September 5th, 2010) neglects the economic idea that an inefficient government may be desirable.
Unfortunately, those successes must be regarded as exceptions. Smart and important legislation, much of it propelled by substantial public support, fell by the wayside in the final days. Indeed, what is most notable about the recently concluded session is not the little bit of good policy the Legislature made but the great deal that it did not. Not to mention the bad bills it passed.
At first glance, it would appear that an increase in efficiency of government would always be pareto improving. However, it may be that an inefficient government is desirable for some.

Specifically, one might see increased government activity as a long-term drain on growth. If, as Rothbard put it, "the State is nothing more nor less than a bandit gang writ large", then we might consider the societal implications for that band being more efficient (they are better able to steal). In this sense, it may be desirous for us to constrain government to only support inefficient programs.

The Law of Demand holds: if something is more expensive, people will buy less of it. In this case, increasing the price of government makes us demand less of it. This, in turn, helps to maximize freedom. This point would hold for consequentialist libertarians, for instance, who might view any government action as more likely to be from an interest group looking to transfer money from the general public using the government, than out of a real interest of a populace.
Where else might this apply?  Deontological libertarians recognize that behind every state action is the barrel of a gun, to put it bluntly.  Take a parking ticket--it wouldn't seem that a firearm is behind one.  However, if one foregoes payment, either a violation warrant may be issued, at which point at any time a man with a firearm (police officer) may go to your home and arrest you by force.  Alternatively, you may simply run the risk of being arrested (through the use of force) the next time you are pulled over.  The only power The Law has is violence and the threat of violence.  

Deontological libertarians further believe that this initiation of the use of force is wrong.  Consequentialist libertarians have no such issue with the initiations of the use of force.  These libertarians support liberty because they see it as bringing about desirable conditions.  Therefore, a politically savvy Deontological libertarian might desire to make large government inefficient so Consequentialst libertarians essentially adopt all Deontological positions.

Corrections concludes that a government that efficiently takes and spends resources is not necessarily desirable due to these economic concerns.  Indeed, we have indicated that for reasons of political economy, some groups may even desire to make it less efficient to manipulate other groups to the adoption of similar positions.

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