Kenneth McDonald is a Toronto free-lance writer. This article is adapted from one that appeared in Re-pert on Business, The Globe end Mail, Toronto.
More than a century ago, Frederic Bastiat described the state as “that great fictitious entity by which everyone seeks to live at the expense of everyone else.” The illusion haunts the modern state today. In country after country governments have dug themselves into pits from which they seek to escape by dragging the rest of society down. Yet they got there with good intentions.
There is an attraction to doing good with other people’s money that is very seductive. Men and women are drawn to politics by a desire to improve the lot of their fellows. If they choose to do so without reaching into their own pockets, who shall blame them? The welfare state makes philanthropists of us all.
Unfortunately it seduces us also with a belief that the state, which the citizens concocted to serve such common needs as for roads and lighthouses and police, and to which common purpose they contributed through taxes, has money of its own.
It is in this, in the changed perception from a man-made convenience to an independent organism, that we were led astray. Imputing to the state the abilities that only man possesses-to invent, to produce and to innovate—we have imputed to it also the ability that flows from them: to create wealth.
Thus when political leaders promise to do this for us, or to do that, we look gratefully upon them for their munificence, as if the wherewithal to do those things were somehow plucked from the air. Forgetting that it must be plucked from us, we have forgotten that the contributions which we are now obliged to make were made at one time by an agreement which is no longer sought.
Having accepted that we shall be taxed, we have accepted that the proceeds will be spent, not merely upon roads and lighthouses and police, which serve us all, but upon a multitude of things which serve only some of us: in youth education; in age pensions; in between almost everything from failing companies at home to failing countries abroad.
As if to excuse the changed perception, our leaders explain that the state’s apparatus has become very complex, as indeed it has. But the complexity is man-made too, made by the state’s functionaries taking on more than they can handle.
Here we find a change from the good intentions to the compulsions of politics, from the common services that are necessary for all to the particular services that are desirable only for some.
“We have done such and such for this group. How can we deny the claims of that?” It is not long before those reflections are magnified into endeavors of the functionaries themselves. “We have regulated this. Why should we not regulate that? We have established a state corporation to do this. Why should we not establish another, and another? Having established them, why should we not put some of our own people in charge of them, or some others from the world of politics in which we have come to move so easily?”
Missing from the reflections is any sense of participation by the great mass of citizens who in the end must pay the price. Whether from the taxes that are paid or deducted, or from lending to the state through bond and other instruments that lose value every minute, or from the tax of inflation that results from the functionaries’ excesses, the ever-growing bill is paid by the citizens.
Never are they given a choice. Never, for example, are grants of their money put to them in terms they can understand, as in, say, to the citizens of Ourtown: “We are going to set up this industrial park in Anothertown and we’re going to take some money from you to pay for it. Is that OK?” Or, say, to the citizens of Anytown: “We are going to set up a pulp and paper facility in Transutopia and we’re going to take some money from you to pay for it. Any objection?”
William B. Stout, principal designer of the Ford Tri-Motor airplane, used to advise aircraft de signers to “simplicate and add more lightness.” It is good advice for politicians today, but how are they to follow it?
As they know too well, any attempt to reduce the expenditures of one department will be contested vehemently by that department’s clients: Agriculture, farmers; Consumer Affairs, consumer associations; Regional Development, every region within hailing distance of the capital; and so on and so on. In short, their profligacy in the matter of promises to particular kinds of electors has come to haunt them: everyone has been promised something and no one will withdraw the claim.
The device that was concocted to serve common needs has puffed it-self up into a multitude of state corporations and departments of state, many of which are duplicated in subordinate jurisdictions. Shrinking it is a task beyond the powers of a few; it must be undertaken by all.
Just as the state grew from a common need, so must its contraction be made a common purpose. Through inflation, all are suffering now. If the expenditures of all the departments were cut, all would endure the illusion of suffering for a time, but how could any complain?