Inflationomics

The Nature of Government

I’m always amazed at how few people understand the nature of government.  Government is an instrument of force.  It promulgates laws, enacts rules and regulations and then enforces them.  This is fine, as long as those laws, etc., are designed to protect our inalienable rights to life, liberty, and the pursuit of happiness.  The problem is that governments are never satisfied just to defend our rights.  At some point, governments want to protect themselves, more than anything else.  That’s when governments start to expand their power by seizing assets and become dangerous.  Let’s look at a few examples:

Russia, the largest country in the world by land mass:  Starting in 1547 with Ivan IV (the terrible), Russia had tzars (emperors).  Supreme power rested with the tzars.  The laws were promulgated and enforced by the tzars.  The only rights people had were the rights the tzars said they had.  This lasted until 1917 with the death of Nicholas II.  After a tumultuous year, the first socialist state was formed by the Soviets and by 1922, the Union of Soviet Socialist Republics (USSR) was formed.  The following description of socialism in the U.S.S.R. comes from Wikipedia:

Following Lenin's death in 1924, a troika was designated to govern the Soviet Union. However, Joseph Stalin, an elected General Secretary of the Communist Party, managed to suppress all opposition groups within the party and consolidate power in his hands. Leon Trotsky, the main proponent of world revolution, was exiled from the Soviet Union in 1929, and Stalin's idea of Socialism in One Country became the primary line. The continued internal struggle in the Bolshevik party culminated in the Great Purge, a period of mass repressions in 1937–38, during which hundreds of thousands of people were executed, including original party members and military leaders accused of coup d'état plots.[77]
220px-Belomorkanal

Millions of Gulag inmates were forced to work on massive government projects such as the construction of the White Sea–Baltic Canal in 1931–1933

Under Stalin's leadership, the government launched a planned economy, industrialization of the largely rural country, and collectivization of its agriculture. During this period of rapid economic and social change, millions of people were sent to penal labor camps,[78] including many political convicts for their opposition to Stalin's rule; millions were deported and exiled to remote areas of the Soviet Union.” 

Clearly, individuals had no rights under the tzars or the socialists.  The socialists are de facto dictators to this day with Vladimir Putin as the current dictator.

China, the most populous country in the world:  China had kingdoms and dynasties for thousands of years.  Kings and emperors ruled with absolute power, until 1912 when a Republic was formed.  The years from 1912 through 1949 saw the second Sino-Japanese war and were most turbulent, culminating in the communist revolution with Mao Zedong.  The following excerpt is from Wikipedia:

After Mao's death, the Gang of Four was quickly arrested and held responsible for the excesses of the Cultural Revolution. Deng Xiaoping took power in 1978, and instituted significant economic reforms. The Communist Party loosened governmental control over citizens' personal lives, and the communes were gradually disbanded in favor of private land leases. This marked China's transition from a planned economy to a mixed economy with an increasingly open-market environment.[113] China adopted its current constitution on 4 December 1982. In 1989, the violent suppression of student protests in Tiananmen Square brought condemnation and sanctions against the Chinese government from various countries.”[114]

While China has adopted a more market-oriented economy, it is still ruled by the communist party and freedoms are limited to what the party allows.  Force can be used arbitrarily against anyone who appears to be a threat to the status quo (even students).  Censorship is rife when it comes to the internet and what the Chinese people are allowed to see and do, for example.  The citizens only have the rights the communist party says they do…another example of complete government control.

United States, the wealthiest country in the world, so far:  The United States started out rebelling against the tyranny and arbitrariness of King George III.  In an unprecedented move, its founding fathers established a republic with checks and balances in the hopes of safeguarding its people from the tendency of governments to become omnipotent and destructive of human rights.  Freedom (for white males) was the general rule, until a number of states wanted to secede from the union and the U.S. had the war between the states (it wasn’t a civil war because both sides weren’t fighting to take control of the same government).  Force was used to keep the states together.

Moving forward, we established the federal income tax, the federal reserve bank, the Wagner Act, the federal labor relations board, Medicare and Medicaid, the selective service draft, foreign aid, and a myriad government bureaucracies set up to limit our freedoms and/or our happiness.  And with every new crisis, we have new regulations and bureaucracies added to the government’s arsenal of force to be used against its citizens.

While we don’t yet have a government that owns all the tools of production and puts us into concentration camps, the Federal government has borrowed billions of dollars and the Federal Reserve Bank has printed trillions more.  Clearly that money isn’t being used to protect our rights.  It’s being used to wage foreign wars, support people on welfare, manipulate market prices, and create bureaucracies that consume our capital (and the jobs that capital could create).  At this rate, it won’t be long before we have consumed our capital and are all equally poor and at each other’s throats.

But then, that’s what happens as governments expand, and expansion by spending other people’s money is the nature of government.

Robert F. Sennholz

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