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What about the common libertarian viewpoint that we should limit the scope of government so that the rich guys don't have any significant political power to hij

by jmckib 12y ago

What about the common libertarian viewpoint that we should limit the scope of government so that the rich guys don't have any significant political power to hijack? This comes without the slowing of economic growth that would be caused by higher taxes on capital.

crazy1van 12y ago
Exactly. We only care about who controls Washington because the gov't has such a huge say over our lives. People claim to want less power in the hands of well connected companies and lobbyists. Then they claim they want government to keep them safe from highly unpredictable events, mandate the minimum and maximum amount of money people should get, provide good healthcare to everyone, prevent kids from being bullied at school, make sure everyone's internet is fast but not faster for one site than another, make sure my french fries only contain "good" fats, allow only certain vices like alcohol but not others like some drugs, etc. Well of course a government that attempts to do all that will be very powerful. And, of course people will spend large amounts of resources to influence a government with that level of power.
JetSpiegel 12y ago
They still have economic power, and no political power to keep them somewhat in check. It's the Wild West.
tszyn 12y ago
The rich don't need the government to exert influence and rig the game in their favor. For example, they can: - buy up their competitors to create monopolies - use one monopoly to build another one (e.g. "if you buy our competitor's coal, you can't use our railroad") - gain control over natural resources - collude with their competitors - abuse the legal system to kill competitors - hire marketers and fund NGOs for propaganda purposes - control the media etc. Once they have gained control over an industry, let's say steelworking or railroads, they become like feudal lords in that industry, setting wages and prices however they wish. Power is subject to a positive feedback loop, whether it's political power or economic power. Having power makes it easier to gain more power. That's why it will always tend to concentrate in the hands of the few. Government power in a democracy comes from a game of "artificial equality": elections in which every person has one vote, regardless of their power "in real life". (This is different from the economy, where your power is proportional to your wealth.) For this reason, it can act against the natural tendency towards concentration of power.
- jmckib 12y ago
  I wasn't suggesting that we scrap the Antitrust Division of the US Department of Justice specifically. You make a good argument that we still need them. However, there are many other areas in which the government could be scaled back without incurring a robber baron scenario. Do some googling for "regulatory capture" and you'll see what I mean. Simplifying the tax code and the bureaucracy that comes with it is one good candidate.
  - tszyn 12y ago
    I've noticed that most examples of regulatory capture provided in the Wikipedia article involve regulatory agencies failing to enforce rules on selected companies (e.g. BP was allowed to drill in the Gulf of Mexico without doing the environmental legwork, Goldman Sachs was allowed to manipulate the commodities markets, etc.), which resulted in Very Bad Things happening. These cases don't show that "big government" regulation is bad. They show that failure to regulate is bad. Off the top of my head, I can't think of too many examples of companies using the government to their own ends. OTOH, I can think of many examples of government restricting the freedom of corporations in the name of some social good. For this reason, I think that if we scaled back the government, corporations would have more power, not less. (Not to mention other negative effects of government abdicating its responsibilities in particular areas.)
brc 12y ago
Exactly. People of a partisan flavour ( and I see much evidence sprinkled throughout these comments) believe that their guy is clean and only has their best interests at heart, while the other guy is evil and greedy. They're all in it for themselves. The key is to ensure that there isn't a big enough state to corrupt so they can consolidate and entrench their power. A small state prevents monoloploies from being formed and from using those wielding power to consolidate their power. And then it doesn't matter how evil the guy who gets the top job is, because he just can't make a big difference. At the heart of all this is how England managed to keep its Anglo-Saxon self-government traditions even after the continental Norman invasion and takeover. Because the Normans could only ever wield limited power at the state level, they could never fundamentally change the way the content was run at a local level. So citizen assemblies and English common law continued and was never replaced with continental law, the final iteration of which is based on napoleanic code. Thus in England, and her spun-off colonies, you're fundamentally free to do your own thing unless there is a specific law against it, while most other places state that you can only do something if there law explicitly states it. This fantastic inheritance was all bequeathed to the citizens of those countries with legal systems based on common law precisely because England had a weak central government which reduced the ability of a king to control everyone, especially when that was a foreign king who had invaded.

by jmckib 12y ago

crazy1van 12y ago

Exactly. We only care about who controls Washington because the gov't has such a huge say over our lives. People claim to want less power in the hands of well connected companies and lobbyists. Then they claim they want government to keep them safe from highly unpredictable events, mandate the minimum and maximum amount of money people should get, provide good healthcare to everyone, prevent kids from being bullied at school, make sure everyone's internet is fast but not faster for one site than another, make sure my french fries only contain "good" fats, allow only certain vices like alcohol but not others like some drugs, etc. Well of course a government that attempts to do all that will be very powerful. And, of course people will spend large amounts of resources to influence a government with that level of power.

JetSpiegel 12y ago

They still have economic power, and no political power to keep them somewhat in check. It's the Wild West.

tszyn 12y ago

The rich don't need the government to exert influence and rig the game in their favor. For example, they can: - buy up their competitors to create monopolies - use one monopoly to build another one (e.g. "if you buy our competitor's coal, you can't use our railroad") - gain control over natural resources - collude with their competitors - abuse the legal system to kill competitors - hire marketers and fund NGOs for propaganda purposes - control the media etc. Once they have gained control over an industry, let's say steelworking or railroads, they become like feudal lords in that industry, setting wages and prices however they wish. Power is subject to a positive feedback loop, whether it's political power or economic power. Having power makes it easier to gain more power. That's why it will always tend to concentrate in the hands of the few. Government power in a democracy comes from a game of "artificial equality": elections in which every person has one vote, regardless of their power "in real life". (This is different from the economy, where your power is proportional to your wealth.) For this reason, it can act against the natural tendency towards concentration of power.

jmckib 12y ago
I wasn't suggesting that we scrap the Antitrust Division of the US Department of Justice specifically. You make a good argument that we still need them. However, there are many other areas in which the government could be scaled back without incurring a robber baron scenario. Do some googling for "regulatory capture" and you'll see what I mean. Simplifying the tax code and the bureaucracy that comes with it is one good candidate.
- tszyn 12y ago
  I've noticed that most examples of regulatory capture provided in the Wikipedia article involve regulatory agencies failing to enforce rules on selected companies (e.g. BP was allowed to drill in the Gulf of Mexico without doing the environmental legwork, Goldman Sachs was allowed to manipulate the commodities markets, etc.), which resulted in Very Bad Things happening. These cases don't show that "big government" regulation is bad. They show that failure to regulate is bad. Off the top of my head, I can't think of too many examples of companies using the government to their own ends. OTOH, I can think of many examples of government restricting the freedom of corporations in the name of some social good. For this reason, I think that if we scaled back the government, corporations would have more power, not less. (Not to mention other negative effects of government abdicating its responsibilities in particular areas.)

brc 12y ago

Exactly. People of a partisan flavour ( and I see much evidence sprinkled throughout these comments) believe that their guy is clean and only has their best interests at heart, while the other guy is evil and greedy. They're all in it for themselves. The key is to ensure that there isn't a big enough state to corrupt so they can consolidate and entrench their power. A small state prevents monoloploies from being formed and from using those wielding power to consolidate their power. And then it doesn't matter how evil the guy who gets the top job is, because he just can't make a big difference. At the heart of all this is how England managed to keep its Anglo-Saxon self-government traditions even after the continental Norman invasion and takeover. Because the Normans could only ever wield limited power at the state level, they could never fundamentally change the way the content was run at a local level. So citizen assemblies and English common law continued and was never replaced with continental law, the final iteration of which is based on napoleanic code. Thus in England, and her spun-off colonies, you're fundamentally free to do your own thing unless there is a specific law against it, while most other places state that you can only do something if there law explicitly states it. This fantastic inheritance was all bequeathed to the citizens of those countries with legal systems based on common law precisely because England had a weak central government which reduced the ability of a king to control everyone, especially when that was a foreign king who had invaded.