A successful society perpetuates itself. It first of all must balance its internal
functions. Since a society is made up of people, this means it must balance the
interests of its members. Second it must be able to unify and make coherent its
collective action. It must act
effectively in its environment, both to secure resources for itself, and to act
against threats to itself.
Every successful society has a government. This implies that governments are necessary
for successful societies. What functions
do governments fulfill, and which are necessary? The Constitution of the United
States, the founding document of its government, lists several functions in its
preamble:” …to form a more prefect union, establish justice, insure domestic
tranquility, provide for the common defense, promote the general welfare, and
secure the blessings of liberty to ourselves and our posterity.” (And we already come up against a defect in
the Constitution in the preamble: the only coherent purpose it authorizes for society
in its environment is for the common defense. There is no explicit purpose expressed
for taking coherent action to secure resources, or assure an economic future,
although this might be inferred from ‘promote the general welfare.’)
As may be, for a society to perpetuate itself, its
government must act against the forces, both internal and external to that
society, which will debilitate and cripple that society.
One of the most important sources of internal socially
disruptive forces is a result of the fallacy of composition: When one person may do a thing it may be good
for himself, but when many, or all, do it, the result is bad for society, that
is, bad for all individuals. Therefore
one of the most important functions of government is the prevention, or if prevention
is impossible, the countering, of situations where the failure of composition
pertains.
These are many. And
of these many fall under the general category of externalization of costs. Pollution, for instance, is externalizing the
cost of producing a good or service. Costs
are also externalized when a company pays less than subsistence, forcing its
employees to go elsewhere, often to charity of governmental assistance, to
supplement their earnings. These can be
phrased in terms of a tragedy of a commons:
Pollution consuming the commons of the air we breath and the water we
drink. Low pay to workers is abusing the
market. Clearly, each company can make
more profit by paying its workers less.
But if all companies pay their workers less, all companies will make
less money, Just as clearly, if all
companies pay their workers more, the workers will have more to spend, and all
companies will make more money.
Another is the ‘Paradox of Thrift,’ brought to the attention
of economists by John Maynard Keynes. If
one person saves, he may be better off, but if all people save, there is a
shortage of spending, the economy contracts, people become unemployed, and in
general, everyone is worse off. The
government can counteract this by lowering interest rates, increasing
inflation, or increasing its own spending, either by deficit spending or
increasing tax and spend.
Consider the fact that Americans work harder than people in
any other developed country, yet our society is the most unequal among them. Cynics have the people believing that by
working harder, they can each of them get ahead. But it is like a race: Even if everybody runs faster, still only a
few will get the prizes. Even if everybody
works harder, still only a few will advance.
The efforts of workers are increasingly devalued. This is becoming increasingly obvious as
growth stagnates, and increases in income and wealth are becoming more and more
concentrated among the few percentages at the top. See my last post. But the top percentages
promote this myth, because all the benefits of all that harder work, all that greater
productivity, by the workers, accrue to the wealthy.
So this is a failure of government. The government is
already failing in its purpose to promote the general welfare, promoting
instead the welfare of a few at the expense of the many, and by allowing
increasing segments of population to become indentured by debt to a few,
failing to secure the blessings of liberty for them. Indeed, as the government increasingly
becomes a creature of the wealthy, its failures may be expected to increase, as
it becomes less and less capable of defending against fallacies of composition. Already economic crimes among the wealthy,
taking from society, from the commonwealth, without return, go unpunished. As
regulations are weakened, as more and more costs or production are
externalized, as the unfettered free market succumbs to the tragedy of the
commons, not just the worker, but the wealthy, will be the poorer.
The commonwealth is also the wealth of the wealthy. They already control it, but in the obsession
of each to ‘own’ an ever greater share of
it, they will destroy the world, and the wealth of us all.
