The Government Creates no Wealth

[_Droopy]

Roads and bridges are the typical examples of government creating wealth,

Already demolished.

but what about GPS or the internet, neither of which would exist without government funding?

Deconstructed. Next...

My best friend is a die-hard Republican and an anesthesiologist in Huntsville. But I know him well enough to know he relied heavily on government loans throughout his ten year education, as did his wife who received no scholarships when she was cruising through medical school. Neither of them would be doctors today without our taxes financing their education, and the amount they borrowed was in the range of a few hundred grand. So given the value they'd provided society over the past ten years, how can we say government isn't at least responsible for some of that wealth creation?

Because they did the studying. They did the staying up late at night cramming for exams. They walked around like zombies for years on end trying to keep their grades up in an extremely demanding academic environment. They went out and got jobs. They built up their reputations and careers. They are competent. They created their own economic viability.

You truly sicken me, Graham. As has been sooooo typical of leftists from the beginnings of modernity to the present, you are a servile, worm-like creature who crawls on his belly before his god, the state, but who wants to be, deep down in his little worm heart, a king worm; a worm of worms who desires that all others should be worms like unto himself, so that, if we are to be worms, at least we will all be worms equally (although some worms, in your world, will of course be more equal than others).

You despise individual liberty and individual agency because you abandoned, misused, and corrupted your own when you violated your testimony and apostatized from the Church. Its a fundamental pattern and well known in the Church from its beginnings to the present time. When one has tasted and enjoyed the the gifts of God and the revelations of the Holy Ghost, and then denies and openly rebels against the light and knowledge he has, the lights go out, intellectually and spiritually (that is to say, intellectually because and as spiritual light is extinguished).

You denigrate, trivialize, minimize, and mock individual effort, achievement, success, liberty, and the power of the individual to set his/her own course and overcome barriers and challenges and achieve personal triumphs and climb personal mountains because you are not at all unlike your present master, Satan, who, in the preexistence, developed precisely the same hatred of free agency and personal liberty that you have developed since your apostasy from God's restored kingdom.

And why? Because Lucifer wanted to be Christ. Lucifer wanted to be the Only Begotten. Lucifer wanted to be worshiped. Lucifer wanted to be the Messiah. But Lucifer was a loser, wasn't he? Lucifer wanted an outcome based world and an outcome based plan of salvation. This all being rejected by the Grand Council and by a clear majority of us, the preexistent spirit children of our Father in Heaven, he came down here and continued fomenting and generating, among those susceptible to his influence, systems similar to that which he supported in the "war in Heaven." Socialism, communism, fascism, National Socialism, Marxism, Cultural Marxism, racialist collectivism (the KKK, the white identity movement etc.), the black power movement, Afrocentrism, La Raza, Islamist totalitarianism/collectivism etc., all of it, despite doctrinal differences between various theories and matters of emphasis and deemphasis, mirror closely Satan's original effort to deny free agency to others so that he could bask in a cheap godhood - and circumvent himself any risk associated with his own mortal probation.

And so here you are, a "useful idiot" of the "god of this world" by usurpation and presumption - for a while, doing his bidding as you support, defend, and justify the derogation, disparagement, and minimization of the individual while you lionize and prostrate yourself before the state and its monopoly powers of coercion and force (no mystery there).

Worms, like dogs, have their day, but it won't last. The great and spacious building will fall, and "great will be the fall of it." I intend to be far, far away from that catastrophic event lest the shrapnel from the vast collapsing edifice find me at a distance. If I can still see the place, I'm probably too close.

What about you, Kevin? This isn't like the Titanic. There are enough - more than enough - lifeboats for all who wish to get off the ship before it takes its final plunge. Why not get in and row for all its worth before the ship goes down and the suction takes you and your family down with it, even though you're not on the ship itself, but only in its general vicinity?

[_Droopy]

Let's put some numbers in here to make the point more clear. Let's say the market value of the concrete, steel girders, re-bar, workers time, etc., are precicely $1,000,000. If that is the market price, that is what the material is worth, right?

Let's say after the bridge is built, the government decides to sell the bridge at auction. At auction, the bridge sells for $10,000,000. That's plausible, isn't it?

By constructing the bridge, a series of inputs worth $1,000,000 was turned into a bridge worth $10,000,000. That is the creation of $9,000,000 of wealth.

So then, you're definition of "wealth" is "money?" While money is wealth in a sense, and a form of property, it has very special properties (as the present $6 trillion in new post Bush debt tells us) that distance it substantially from "wealth" in the normative sense of the term and as I've explicated it here.

When presented with this precise scenario, Thomas Sowell said, and I quote, “It is of course theoretically possible for government to create wealth.” Can you explain why you disagree with Dr. Sowell on the point?

Certainly (if it is the case that I do actually disagree) when you explain what Dr. Sowell meant by his use of the terms 'theoretically possible" and elucidate its boundaries and applications.

[_Droopy]

I disagree with this, it is my religion that creates simplistic economic models with the precept that human beings are rational.

Human beings are self-interested. They can be rational, or irrational. If you actually understood basic Austrian economics, Gad, you would understand that value is primarily a subjective psychological phenomena, often rational, but as often, especially at the retail end, purely personal.

Droopy, on the other hand, believes that humans must first become Christians and right-wing intellectuals, and only then will they be rational, and only then will a free market work.

Really, how moronic need you become to mock and snigger at your opponents? Let's get back on track, Gad.

Most right-wingers, including Droopy, have admitted that government creates wealth even by higher standards, because they believe some functions of society are prone to market failures.

I would say that I believe, not so much in market failures (although in some very limited senses, most particularly police, military, and the like, it is very difficult to see how free markets could function effectively, if at all) but in the limited efficacy of markets in some areas. The post office is a clear example of something that might be better done by government, but which might also be done much better by a plethora of competing private sector services. Other examples would be power generation. Something like detectives, cops, and SWAT teams present wholly different problems (which is why I am a conservative and not a "strong" libertarian).

Droopy's argument is shape-shifting though to the point where he's restricting Government activity to the actual wealth transfer by fiat, and then defining wealth creation as something else, and then saying, "see, by definition, the government can't create wealth".

By my definition, and by the definitions used by most libertarians and conservatives, the state cannot create new, net wealth; it cannot expand the size of the economic pie.

People who really believes that "the government can't create wealth" should be anarchists, not conservatives or libertarians.

This is sheer nonsense. Anarchists do not believe in government! They do not believe in the fundamental legitimacy of the state as a concept. Saying that government, which is purely dependent upon prior private sector wealth creation for its existence (unless it just turns on the printing presses or just borrows phantom money ad infinitum), cannot create wealth in a real, economically meaningful sense is a matter of economic theory and understanding, not a denial of the fundamental legitimacy of government as a concept.

[Guest]

FYI, in case you forgot, I think the Austrians are up in the night. I'm a Chicago man, Droopy. Hence my statement about rationality.

I would say that I believe, not so much in market failures (although in some very limited senses, most particularly police, military, and the like, it is very difficult to see how free markets could function effectively, if at all) but in the limited efficacy of markets in some areas. The post office is a clear example of something that might be better done by government, but which might also be done much better by a plethora of competing private sector services.

But yet the post office is NOT expanding the economic pie; hmmm....

Anyway, the military not "functioning effectively, if at all" in a market is a "market failure", that's textbook terminology, not mine, Droopy. You can spare the "limited sense" qualifications. If you believe government should provide military, then you believe in a market failure. That's not to "bad mouth" markets, that's just the term, I didn't make it up. And the limited efficacy of markets in some area is still a "market failure". That's the term.

Why is government on the table for doing postal service better than private industry? What makes you not so sure? What makes postal service different from the military?

[_Kevin Graham]

Analytics clearly outlined his definition of wealth, and Droopy still doesn't get it. No Droops, he never said wealth is just money. You simply do not understand what wealth is. Your explanation that wealth means, "to create new, net wealth."

What the hell?

That's like saying the definition of a thingamajig, is to "create new, net thingamajigs."

You completely avoided the question. Analytics clearly said wealth is anything of value, and you just can't wrap your mind around that fact because it sends your Heritage Foundation-based talking points into a complete tail spin. Anything of value is considered wealth. Peace of mind is wealth. A stress free life is wealth. American millionaires pay out the yang to obtain these things all the time, when in fact it comes free in other countries where people don't have to worry about dying because they can't afford health care.

Time is wealth just as being healthy is considered wealth. To prove it, all you have to do is offer a million dollars to someone on the condition that he/she will forfeit his/her life in a month. How many people do you think would take you up on that offer? That would be an interesting social experiment but I guarantee you no one would take the offer, unless of course they only had a month or so to live due to cancer or whatever. The point is, such an experiment would prove that time on this earth is of tremendous value (i.e. "wealth). And how much is our time in this life worth? Obviously much more than a million dollars per month. By that measure, based strictly on value determined by the free market, the Affordable Care Act, which provides health insurance benefits to millions of Americans, effectively creates wealth worth trillions of dollars. But you don't understand any of this because it is you, not analytics, who sees wealth strictly as something tangible like money or goods.

And you still haven't addressed the fact that government does create wealth. It isn't "in theory," it is already a reality. Your claim that liquid propane was later marketed by private individuals doesn't change the fact that it was discovered by a man who was educated and employed by the US government. Without government issuing regulations for the production of propane, there'd be no business for it. Nor have you explained how a government created internet doesn't create wealth. Nor have you explained how government funded innovations, such as medical breakthroughs within public institutions, doesn't create wealth when they are in fact handed over to private companies so they can market them for their own profit.

A government funded program seeking out oil on federal lands, is in fact an act of creating wealth once that oil is discovered. However, the government isn't in the business of making a profit, which is something that could easily be remedied. The government could very well be in control over the drilling and pumping of crude on federal lands, instead of leasing it out to private companies. After all, it is a natural resource that belongs to the American people. Why hand it over to private companies so they can then hide behind "free market" mantra to screw the public and rake in record profits year after year?

[_cinepro]

As I pointed out above, you are now playing a semantic game, which is not going to count as a logical argument unless you define your terms and their usage with some degree of rigor. You have also just played into the "you didn't build that" mentality of the Left, in which the state is the actual foundation and source of all wealth, and to which proper gratitude must then be shown.

I'm not sure how you're getting that.

In the case of a bridge that the government built, I would absolutely say "I didn't build that". As a taxpayer, I would acknowledge that I contributed some degree towards its construction, and as a group of taxpayers we could say collectively that "we" funded it.

My contribution may have been an involuntary one (hence my objection), but it would be similar to the contribution someone makes when they buy stock in a company. I might own Apple stock, but I'm if someone told me I didn't build Apple, I would agree.

As for the rest of your post, I can only offer you this hypothetical.

Suppose you were a trusted advisor to President Eisenhower in 1956. During preparation for the budget, it comes to light that there is a surplus of $5 billion.

The democrats in congress will not allow that money to be returned to the taxpayers, but they offer three options that they will go along with. All of the money has to be spent on one of these options.

First, you can fund a space program to research manned space flight and try to put someone on the moon.

Second, you can fund the construction of a modern national highway system.

Or third, you can fund anti-poverty programs to provide food and low cost energy to poor people.

Eisenhower comes to you and says he is interested in increasing the wealth of the country, and, if possible, generating a return of greater than $5 billion on this expenditure, so even though the taxpayers aren't getting their money back, their "wealth" will nevertheless increase in general.

What do you tell him? Is it impossible for him to achieve his goal? Are all three options nothing more than redistribution, and therefore equivalent when it comes to considering the "wealth" of the country?

I hope you never try to play SimCity Droopy, because you'd be terrible at it.

[_Analytics]

Let's put some numbers in here to make the point more clear. Let's say the market value of the concrete, steel girders, re-bar, workers time, etc., are precicely $1,000,000. If that is the market price, that is what the material is worth, right?

Let's say after the bridge is built, the government decides to sell the bridge at auction. At auction, the bridge sells for $10,000,000. That's plausible, isn't it?

By constructing the bridge, a series of inputs worth $1,000,000 was turned into a bridge worth $10,000,000. That is the creation of $9,000,000 of wealth.

So then, you're definition of "wealth" is "money?" While money is wealth in a sense, and a form of property, it has very special properties (as the present $6 trillion in new post Bush debt tells us) that distance it substantially from "wealth" in the normative sense of the term and as I've explicated it here.

I didn't imply wealth is money. I implied wealth has value. If you are confused about the role money plays in society, I can make the same point in a society that uses the barter system: if the government takes a series of inputs that could be traded for 10,000 cows and uses it to create a bridge that could then be traded for 100,000 cows, it created new wealth that is equal in value to 90,000 cows.

When presented with this precise scenario, Thomas Sowell said, and I quote, “It is of course theoretically possible for government to create wealth.” Can you explain why you disagree with Dr. Sowell on the point?

Certainly (if it is the case that I do actually disagree) when you explain what Dr. Sowell meant by his use of the terms 'theoretically possible" and elucidate its boundaries and applications.

He did in fact concede that in the example I provided, the hypothetical government did in fact create wealth. By "theoretical", his point was simply his belief that most of the actual activities that real governments engage in are either wealth transfers or actually destroy wealth (such as Alaska's "Bridge to Nowhere", that was essentially taking $100,000,000 in inputs to create a bridge only worth $10,000,000). His point had nothing to do with esoteric "boundaries" or "applications".

[_Analytics]

I hope you never try to play SimCity Droopy, because you'd be terrible at it.

Well said. Could the point be made more succinctly?