Government

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What is government?

First of all, it is an organization. An organization is a group of people intentionally organized to accomplish an overall, common goal or set of goals.

In my article "Negative Impacts of Inflation" I described government using our simple 5 people economy. Government would be person A who provides services to all other participants of the economy. This in itself does not yet essentially distinguish A from the other participants in the economy, since they all provide services to each other.

What distinguishes A is the fact that he is granted the privilege to establish forceful rules that impact the freedoms of the other participants in the economy. In particular, A has the privilege to determine how much of the money that the participants in the economy earn, they need to pay to him on a regular basis.

This is indeed a notable distinction. A, as opposed to all other participants is granted the privilege to constantly force everyone else to follow his/her rules.

In fact, there is only one type of institution that has throughout history, by the virtue of law, had the ability to impose their force on people: government.

As far as this fact is concerned, I am not making any difference between dictatorships, communist, monopolist, democratic, fascist, Islamic or authoritarian governments or whatever other labels there are to attach to governmental institutions.

The extent to which governments exercise their power, impose their force upon people, and cause inefficiencies and misallocations differ from one to another in different systems. Also the ways governments get to power differ from one to another. However, what does not differ from one government to another is the basis of their existence: compulsion and coercion.

There is no other, publicly accepted, organization that can expropriate people by forcing them to pay money for services.

A company that provides services to an individual can stop providing those services once that person does not pay anymore. If that individual would like to resume consuming the company's services he would have to start paying again.

One could assume that if I really was in dire need for the services government provides and I were to stop paying taxes, government could just stop providing its services to me in order to make me pay again.

Which brings us back to my initial question:

What is government?

Government is the social apparatus of compulsion and coercion.

The means that different people pursue or have pursued in order to get in power and form governments differ significantly.

In ancient times, they used to do it by recruiting the clerical class and making the case for a "divine law" which they supposedly merely exercised in the name of god.
Some have done it or still do it by using force, guns, and military power.

Over time, people have fought countless struggles for liberty and freedom. The outcome of those is democratic government. In a perfect democratic society the social apparatus of compulsion and coercion is elected by the people. The people are the ultimate sovereign. Government shall ensure that society functions by figthting aggressors, viz. people who try to infringe on others' freedoms.

Government's operations need to be strictly confined by rules, bills of rights, and laws. This shall ensure that it doesn't abuse its power. All the benefits brought about by the struggles for liberty stem from the confinement of government meddling with the market economy.


As Mises puts it:

"Government is in the last resort the employment of armed men, of policemen, gendarmes, soldiers, prison guards, and hangmen. The essential feature of government is the enforcement of its decrees by beating, killing, and imprisoning. Those who are asking for more government interference are asking ultimately for more compulsion and less freedom." (Mises, Human Action, Chapter XXVII, Part 2)

As Rothbard puts it:

"The State is a group of people who have managed to acquire a virtual monopoly of the use of violence throughout a given territorial area. In particular, it has acquired a monopoly of aggressive violence, for States generally recognize the right of individuals to use violence (though not against States, of course) in self-defense.5 The State then uses this monopoly to wield power over the inhabitants of the area and to enjoy the material fruits of that power. The State, then, is the only organization in society that regularly and openly obtains its monetary revenues by the use of aggressive violence; all other individuals and organizations (except if delegated that right by the State) can obtain wealth only by peaceful production and by voluntary exchange of their respective products. This use of violence to obtain its revenue (called "taxation") is the keystone of State power. Upon this base the State erects a further structure of power over the individuals in its territory, regulating them, penalizing critics, subsidizing favorites, etc. The State also takes care to arrogate to itself the compulsory monopoly of various critical services needed by society, thus keeping the people in dependence upon the State for key services, keeping control of the vital command posts in society and also fostering among the public the myth that only the State can supply these goods and services. Thus the State is careful to monopolize police and judicial service, the ownership of roads and streets, the supply of money, and the postal service, and effectively to monopolize or control education, public utilities, transportation, and radio and television." (Rothbard, War, Peace, and the State)