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Interventionist polices impoverish us

I received an informative e-mail regarding significant tax increases alleged to begin in 2011. To be honest, I've made no effort to check the veracity of its claims, but one response to the message was "That's okay. I don't mind contributing to the greater good ... except the wars."

According to the War Resisters League, current military spending makes up 36 percent of federal government spending. Another 18 percent they report is for veterans benefits and interest payments on the national debt, which the league contends only exists because of our military spending.

Joseph Sobran was right, "War is just one more big government program." The biggest by far.

War is destructive and not a wealth generator contrary to popular claims. Military planes, tanks and bombs add nothing to our qualities of life, not to forget the destroyed homes, buildings, streets, and the individuals lost and families ruined.

But, what about our other tax money contributing to the greater good? The respondent doesn't mind a benevolent government taking a measure of all families' wealth to fund what he considers beneficial to the community.

What greater good?

I, too, like to contribute to good things, but it's important to discover whether the government taking resources from the private sector actually benefits the greater good. I think this conventional wisdom in many cases bears scrutiny, particularly recent stimuli, bailouts, and perennial special-interest subsidies.

Henry Hazlitt, once a Connecticut resident, in his book "Economics in One Lesson," expertly explains the opportunity costs of some public policies. He writes, "the whole of economics can be reduced to a single lesson ... The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups. Nine-tenths of the economic fallacies that are working such dreadful harm in the world today are the result of ignoring this lesson."

I've written here previously on how government's interventions incentivized malinvestments that caused the recession. Government's response has caused more of this harm.

It's easy to see the beneficiaries of public subsidies - a corporation, bank, or farmer, and those they employ and others with whom they trade. It takes some consideration to understand the opportunity costs.

Consider that without government intervention General Motors would have sold their assets to other companies allowing this capital to be used more efficiently. Legislators made claims about the jobs saved, but what of the jobs lost from where the subsidy money, if left to us, would have been invested and spent otherwise?

Creating wealth

These lost jobs are difficult to appreciate as they would have existed in thousands of places. A free market would naturally direct the resources to the most efficient and productive activities, creating more wealth for everyone and expanded industry and employment.

It is wealth that enables us to educate ourselves and our children, provide for our health care and safety, nourish ourselves with healthy foods, protect our environment, aid others, and engage in the activities in which we delight.

Additionally, much of our wealth in the hands of government surely is lost to the costs of bureaucrats and regulators, mismanagement, and graft.

Government is best when it serves as an impartial referee-prosecuting fraud, upholding contracts, employing punitive force to those who have harmed others. But governments mostly act as interested participants, choosing winners and losers. Many receive from government unfair advantage in the form of regulations (which moreso burden smaller outfits), subsidies, tariffs, land grabs, liability caps, and taxpayer-provided insurance. These harm market forces and lead to perverse incentives, moral hazards, diminished real wages, increased prices, decreased quality and safety, and scarcity, which harms all of our qualities of life.

To the e-mail respondent, let's endeavor to end the costly interventionist policies abroad and at home that impoverish us. Only this would be universally beneficial to individuals and the greater good.

Marc Guttman is the editor of the soon to be released book, "Why Liberty." His website is


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