The United States of America, Incorporated
Permalink Posted on 09-14-2006 at 06:20:02 pm by Justin, 766 words, 557 views  

Government in a nutshell:

Government owes its existence to extortion, which is the coercive taking of wealth. This lone quality is government's defining characteristic. That said, assuming a government is charged with doing something more than just appropriating the wealth of its population, its secondary task is to subsidize those who scream the loudest while taxing those who cry the least. It's a problem of negative externalities: it's individually more beneficial to rent seek subsidies from the government than it is to eliminate taxes that are costs to everyone. Since growing government is an exercise involving negative externalities whereas reducing government favors positive externalities, it is no surprise that the size of government almost always expands -- even to the point where it is extorting so much wealth from its population that it becomes difficult to find any more blood to suck without killing the host.

Where there's government, there is always a ruse. The ruse is that governments can do more good than harm. The ruse is that a government can ever overcome random luck or level a playing field or make the natural coercion of life and death fair. The ruse is that a government can ever be pro-freedom. And despite how ridiculous this ruse appears to some, most of humanity is duped.

Freedom and Markets:

It is important to understand the distinction between a free market and a government-controlled market. The former variety, which I'll call laissez-faire, runs without bias of coercion: market forces, which are merely the outputs of voluntary human action, are left undisturbed. The government-controlled market is, by definition, not free: external, involuntary forces extort pressure to affect human action in varying, often catastrophic ways. As an aside, it could be argued that the phrase, "free market", is redundant: if a market comes into being, it is ipso facto the voluntary, free exchange of property by distinct self-interested entities.

The United States of America is not laissez-faire friendly:

The U. S. of A. regulates human behavior via taxation, subsidization and other impediments to or encouragment of human behavior. The United States is not a laissez-faire market.

Many believe that the U.S. is a freedom-friendly, free-market fostering government. Though the U.S. government does a decent job protecting many freedoms denoted in the Constitution and Bill of Rights, it heavily subsidizes, protects and helps business - particularly big business. Bestowing subsidies requires levying taxes. When it comes to big business, for example, a corporation is given special standing as a recognized legal entity - just like you or me. This legal entity pays taxes, enters contracts, accumulates wealth and can go bankrupt. Yet it can't die. It also has liability apart from its owners. We accept the existence of corporations as they are in the United States as a natural outcome and manifestation of free market ideals. But is this the case? What is a corporation without its owners?

Businesses receive tax breaks for entering certain geographic regions. Employers are subsidized into hiring more employees than they otherwise would need. Sometimes, the government just outright gives a business free capital or relieves a business of debt. Do not mistake these actions as pro-laissez-faire. They're not.

Since a government can be inluenced, it will always work against a free market. Subsidizing business, or corporate welfare, is no more laissez-faire than is taxation. Helping business disturbs, perturbs and otherwise frustrates the naturally regulating business of unfettered human action. The only way a government could foster a free market would be to be free market neutral, which is to say that the government would cease to exist.

The United States of America, Inc.

Though the government certainly hinders the prosperity of business in many, many ways, the ways in which the government takes pro-business action are far more plentiful. Either way, there should be no confusing the U.S.A. with a laissez-faire, free market. The market that the United States of America reigns over is more a pseudo-market, one masquerading as "free" per the words of politicians while being nothing of the sort. Through hijacking the term "free market", the government turns freedom-loving individuals against free markets, which is inseparable from individual freedom. Even further, those who understand the inseparability of freedom and free markets are often duped into thinking that they must justify the business environment in the United States because it is somehow representative of a "free market."

Be duped no more. See through the ruse. We live in the United States of America, Incorporated, too often run by wealth, business and power, almost always misguided and most certainly not a free market.

Comments, Pingbacks:

Comment from: Aaron [Member] Email
Boy, and there are so many more examples of the government perpetuating a business (typically, shoddily or irresponsibly-run) by directly relieving it of debt.

For example, the entire purpose of the Pension Benefit Guarantee Corporation (which is not a private corporation at all but a government bureau of questionable legality, just like Fannie and Freddie) is to relieve business of their untenable pension liabilities when it becomes clear they cannot be met.

Unsurprisingly, these are some of the steepest real liabilities our beloved mega-corporations have (e.g. http://globaleconomicanalysis.blogspot.com/2006/09/what-is-ford-worth.html)

Incidentally, that would be more of that "optionality" Steve Waldman was talking about--except extended to all of business by limited liability and obscene CEO payouts.
PermalinkPermalink 09-14-2006 @ 23:52

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