Big Government

This site has moved to http://www.economicsjunkie.com/government-growth-in-the-united-states/

Up until about 200 years ago great accomplishments were made in the field of political liberation. The statist hegemonic bonds were broken up and governments were confined in exercising their power. Private ownership of the means of production has brought about unprecedented wealth and progress. The average American worker enjoys amenities for which Croesus, Crassus, the Medici, and Louis XIV would have envied him.

Ever since things have been heading in the other direction again. Governments have increased the tax burden on people (in relative as well as in absolute terms), increased public debt, created excess money and inflation, assumed more and more power, and driven up the number of wars and civil disorders to levels the world has never ever seen before.

Let's take for example the development of taxes and government spending in the United States over the past 50 years. (source: www.taxpolicycenter.org)

Total (Federal + State + Local) Tax Revenue As Percentages of GDP (1947 - 2003)




Total (Federal + State + Local) Government Expenses As Percentages of GDP (1947 - 2003)


I have not been able, as of yet, to find %age data that goes back to the 19th century. If anybody has something please let me know, I'd be happy to update these charts accordingly.

However, I believe that after looking at this we can all conclude: There haven't been any tax cuts. Maybe taxes went up and down a little bit within shorter periods, but overall the tax burden has increased over the past 50 years. This also means that there is no so-called "neoliberalism".

I assume that most people agree that, at least to a certain degree, something seems to be wrong in our political system today, and that there are problems that need to be fixed.

Taking into consideration the numbers and facts presented here, and applying pure common sense, I assume that most people would unanimously agree to at least the following:

We do NOT need any more taxes or bigger government to solve our economic policy problems. If, in fact, government keeps increasing in size and people keep accepting it, or even calling for it, these problems will only be aggravated.

Those of us who are not part of the governmental body and yet assert that we need government spending in order to ensure a sufficient supply of basic goods and services that the poor and unfortunate people couldn't afford in a free, unhampered market, are either walking around with blinkers, or have given in to statist welfare propaganda and lack the intellectual capacity to accept and process basic principles of human action and praxeology.

But the lack of aprioristic reasoning and conceptualization (praxeology) does not seem to be the only problem here. In addition to that we see a lack of ex-post understanding of history.

The belief in the necessity of government ensuring supply of basic (or so called public) goods would, if applied consistently, imply that we need government to take care of the production of basic goods, such as food and clothes in order to avoid shortages. It is commonly agreed that a human in modern society needs those goods at the very least in order to be able to survive.

Reading this, the welfare state proponent should pretty quickly notice that we actually appear to have a more than sufficient supply of those particular goods in our western societies and that government intervention doesn't seem to be necessary here.

Moving on, the welfare state proponent has to accept the fact that it is precisely in the domain of the so called "public goods", such as government schools, domestic security, and highways where we constantly see shortages. Kids are not properly educated in schools (especially in the poor areas), our cities are everything else but safe (again, especially in the poor areas) and we constantly complain about traffic jams. And what is the reason for these problems according to the welfare state propagandist? It is of course that the state does not have enough money and needs more of the same to provide its services in a sufficient manner. According to him, we have a "shortage" of public funds.

But haven't I shown in the beginning of this article that this clamor for more money has been more than constantly addressed over time? Is there any reason to believe that the welfare state propagandists will one day stop asking for more?

It is clear that this will never happen. I have never seen a government anywhere in the world that was content with its pecuniary affairs and had its finances under control. They will keep asking for more and, as long as taxpayers comply, will keep spending more and I can assure you one thing: It won't help a bit.

-----
I'd like to mention that I have been using link2blogs.com to promote my blog at it has really helped me get the word out there.
----