Alberto Mingardi  

Big Government is young. Let's not forget it

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I am reading Charles Murray's "By the People. Rebuilding Liberty Without Permission". By the way, It is quite an engaging read.

Right at the beginning of the book, Murray struggles to give some measure of the extent of increase in government involvement with everyone's life.

Here's a passage:

Until the 1930s, the federal government remained tiny. The federal budget of 1928 totalled $38.0 billion, expressed in 2010 dollars. (...) Of that total budget in 1928, $9.4 billion went to defense. Of non-defense spending, another $9.4 billion went to repayment of the national debt and $9.0 billion went to pensions and the Veteran Bureau. That left $10.2 billion for everything else - all the expenses associated with the White House, the federal judiciary, and the Departments of State, Treasury, Justice, Commerce, Labour, Interior, the Post Office, and all the independent agencies of the federal government. Expressed as per capita spending in constant dollars, that $10.2 billion amounted to 1.0 percent of comparable federal spending in 2013. Think about it: one one-hundredth.

Murray has quite a few similar "facts from the past" that turn out to be rather surprising for the contemporary reader. To me, the most striking thing is how fast government expansion was accomplished. I fear we very often forget that. In Western countries, most people today think pensions are a most common feature of human life - and yet human beings had compulsory savings and pension systems for a minuscole fraction of their history.

If government grows fast, however, culture changes fast too. The sense of entitlement takes root easily in society.

For one thing, looking back makes us think that big government is not inevitable: after all, government was capricious, tyrannical, arbitrary during most of human history, but it never was this intrusive and expensive. For the other, it is remarkable how easy we get used - perhaps, we become addicted? - to new government programs, and how strongly they can permeate society and change culture.

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COMMENTS (10 to date)
david writes:

Good reading.

Perhaps you should ask Bryan Caplan whether this is generally persuasive rhetorical territory upon which to appeal to freedom (even if he hasn't changed his mind in the past five years).

Chris Wegener writes:

In 1930 the US population was 123 million people and the world population was 2,070 million people.

Today the US population is 325 million and the world population is 7,439 million.

With that many people rubbing elbows it is inevitable that organization and laws to deal with the greatly increased interaction are required.

Do we seriously argue that in today's environment the institutions of the 1930 could successfully deal with the modern world?

Hunter writes:

We are using many of the institutions of the 1930's only larger and more bureaucratic. Government as constitued is not the tool needed to deal with the number of people and the complexity of the modern world. We need far less of it.

Jameson writes:
Do we seriously argue that in today's environment the institutions of the 1930 could successfully deal with the modern world?
The population increases three fold, so the government should increase a hundred fold? Is that seriously an argument?

Anyway, I think the irony here is that what made government this big is...capitalism. People who become this wealthy cannot help but demand more government services, since they believe there is security in that. I recall Tyler Cowen writing something to that effect. Not to mention the fact that technology this advanced makes it all the more plausible to bureaucrats that they can keep an eye on everything. The more great ideas the market produces, the more toys the government has at its disposal. That doesn't inevitably lead to bad outcomes, but it does mean there's a lot of potential for a large concentration of power.

Chris Wegener writes:

Even though the population has increased threefold population density as measured where people live and work has sky rocketed. This increase social friction and leads to further government. (New York in the 1930 still had a large police force and more government services than many places in the western part of the country which was much more sparsely populated.)

Greg G writes:

Yes, big government is young. Capitalism is also young.

The small government of the 1920's was giant compared to the small government of the 1820's.

The growth of government and capitalism at the same time seems more than co-incidental to me. I realize that most here will want to say that is because government is parasitic on capitalism. I am more inclined to see the relationship as symbiotic, at least to a point.

Capitalism too has grown spectacularly since the 1920's. If big government was so inimical to it you wouldn't have expected that growth to co-incide with the growth of government as closely.

Nathan W writes:

It turns out that forestalling the "inevitable" Marxist revolution is costly. But so long as it helps to uphold a social bargain where people generally value the role of markets, then I most likely it's worth it.

In other words, we may have beaten the communists, but the socialists left a mark (the welfare state) that is probably here to stay.

The massively increased aggregate expenditures (in both absolute and relative terms) in education and health, for example, are hardly a drag on society. Healthy and well educated people are far better contributors to current production and future innovations or technological advance.

Lars P writes:
human beings had compulsory savings and pension systems for a minuscole fraction of their history

It hasn't even gone a full cycle yet in most countries. In the sense that these systems are intended to span people's whole lives.

Darin writes:

Human beings had anything we recognize as free market, liberty and human rights for a minuscule fraction of their history. If i was a libertarian, i wouldn't use this argument at all.

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