Commentary Economy federal budget

Government, Not Its Shutdown, Is The Real Problem   

As the partial government shutdown continued, more and more people found themselves discomfited, inconvenienced or harmed in some way. With it came hope from the political left that those problems would convince people how central and valuable government is to each of us, moving people their way at the ballot box.


This was illustrated by a Washington Post article by James Hohmann and Joanie Greve. They wrote that “One enduring result could be that Americans collectively come to appreciate the value government provides in their everyday lives to a greater degree.” They then contrasted the resulting “teachable moment on what exactly the government does and how important it is to people’s lives,” with Ronald Reagan’s statement that rather than providing solutions to problems, “Government is the problem.”

They document some problems from the shutdown. However, long wait times at airport security, problems providing food stamps, difficulties with affordable housing contract expirations, meeting payrolls, etc., do not disprove “government is the problem.”

A major reason is that the government does things it has no business doing.

Failure To Deliver

Suppose the government created a bureaucracy with the power to selectively issue “free speech” permits, which were sold to those approved to speak on particular public issues (you might think that could never happen, especially given the First Amendment, but it differs little from the effects of the fairness doctrine for radio before the Reagan administration eliminated it). Or it created a bureaucracy that administered the civil asset forfeiture abuses of citizens.

Neither advances our general welfare. Neither comports with the logic or core documents of America’s founding. Neither involves a constitutionally enumerated federal power. Yet people would adapt to the rules they faced, defensible or not. If a government shutdown then cut those bureaucracies’ funds, the failures to deliver services as expected would cause people problems. However, those problems do not prove government policies make us better off.

Crowding Out Private Sector

Similar logic applies to functions that often have been provided by the private sector (e.g., education and services offered by private insurers and friendly societies), but have largely been crowded out by government because of its special treatment (e.g., exemption from property taxes), coercive power (e.g., regulation and eminent domain) and access to taxpayers’ pockets for financing.

In those areas, government bureaucrats know our circumstances and preferences less well than we do and care about us less than we do. They operate without the constraint of covering their bills through voluntary transactions. And they will predictably serve us worse, and at a higher cost, than what they crowded out.

The only other alternative relies on government theft from others, which is diametrically opposed to “liberty and justice for all.” Again, if a government shutdown further eroded how well “public servants” served Americans compared to voluntary arrangements, that does not prove such government policies make us better off.

Government’s Broken Promises

Further, even in areas many believe government should determine our choices, the shutdown teaches a far more important lesson than extolling the value of government services. It demonstrates that government cannot be counted on to deliver on its promises, however valuable they might be if reliance was justified.

After all, all the problems resulting from the shutdown involved government failure to deliver on commitments it has made. Further, there is no assurance it will not happen again, or be even worse, in the future (very possibly the very near future).

When that unreliability is added to the unfunded liabilities from a cornucopia of government programs — Social Security, Medicare, etc. — they become so large, they cannot be delivered on. The more people realize how untrustworthy government commitments really are, the less they will rely on them or be manipulated by promises that aren’t credible.

The government shutdown certainly created problems. And it reminded us that our octopean government has thrust its tentacles virtually everywhere in our lives. But the problems were caused by government failure to perform duties it arrogated to itself, not because extending its power over us advanced citizens’ well-being.

  • Galles is professor of economics at Pepperdine University, a research fellow at the Independent Institute, an adjunct scholar at the Ludwig von Mises Institute, and a member of the Foundation for Economic Education Faculty Network. His books include “Apostle of Peace” (2013), “Faulty Premises, Faulty Policies” (2014), and “Lines of Liberty” (2016).

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