American government spending has grown exponentially over the past 50 years. In 1930, the Gross Domestic Product of the United States was $91.2 billion and total federal spending was $11.9 billion. Last year, the GDP was $14 trillion and total federal spending was $5 trillion. This means that in 1930, federal government spending accounted for 12 percent of the GDP; today’s government spending accounts for 36 percent. That 24 percent difference equates to today’s government controlling $3.4 trillion more of our money than it would if government spending was at its 1930 level.
The U.S. Census Bureau reports that the U.S. population in 2008 was 304,059,724. This means that if government were the same size as it were in 1930 and the government-controlled funds of $3.4 trillion were evenly distributed among the current U.S. population, each person would receive $11,184. Which would you prefer: more government spending or 11 grand more in your paycheck?
The increase in government spending over the past several decades hints at a movement towards socialism. Socialism can be viewed as government regulation on the means of production and goods. The U.S. remains a capitalist country in the sense that we maintain free markets populated by non-government owned companies (aside from those partially owned by politicians). The U.S. government, however, has been slowly assuming control of once private market responsibilities. Take for example the minimum wage law, now a common and widely accepted legislative practice. The responsibility of determining fair pay was once the duty of an individual employer or company. In 1933, the federal government attempted to assume this responsibility, but the Supreme Court deemed this portion of the National Industrial Recovery Act unconstitutional in Schechter Poultry Corp. v. United States. Five years later, the federal government attempted to set a minimum wage again. This time, the Fair Labor Standards Act successfully set the minimum wage at $0.25 an hour.
Fair labor standards appear to be a great thing, but in reality, they are impossible to achieve. Simply put, individuals do not all have the same skills; individuals with the same skills are not all of equal skill level. Therefore, employees are not of equal value to an employer. Employers base employee compensation based on skill and the ability to use that skill well. Skilled workers should be paid more than unskilled workers. They are of more value to the company. These same employers have operating budgets they must adhere to and are limited in selecting either the skill or quantity of employees. Minimum wage sets a minimum value on employees and requires companies to hire workers of a given skill level. Employers are no longer allowed to make the choice between employee skill and quantity.
The low-skill jobs that minimum wage legislation intended to protect have been abolished or become unpaid instead. Consider how uncommon it is for a teenager to have the opportunity to work for a company in his/her field of interest. Some would argue this is because teenagers lack the skill and experience necessary to work in a skilled environment, but consider if there were no minimum wage. These teens could work for a few dollars an hour while gaining extremely valuable experience. Instead the minimum wage bars unskilled and low-skill workers such as teenagers from the labor market entirely. Minimum wage legislation shows that federal regulation on the means of production — i.e. socialist policy — is well intended, but ultimately harmful.
The economist Milton Friedman explains the foundations for capitalism and why socialist policy fails its intended goals. His argument rests on the idea that man is naturally greedy, inclined toward the collection of goods, materials and money to better his own condition. He asserts that government must account for this greed instead of ignoring it. The only form of government that does this is capitalism. Capitalism succeeds because individuals spend money in the most wise and prudent manner when they spend their own money on themselves. Conversely, poor monetary decisions are made in social policy, because the decision makers are spending someone else’s money on someone else. This form of spending has the least amount of personal impact on the decision maker. If the money is spent poorly it is only the person who provided the money and the person receiving the goods who will suffer, not the decision maker. When the people in government decide how to spend our money it is poorly spent. Our money would be spent much more efficiently and in lower amounts if we were allowed to spend it on ourselves.
Lifetime politicians compound the problem of government over regulation. In our democratic republic, average people were intended to rule. As President Lincoln so clearly stated in The Gettysburg Address, the U.S. possesses a government “of the people, by the people, for the people.” If normal citizens are running government, and all people are inherently greedy, then the people running government are also greedy. This problem is amplified by lifetime politicians. While not all bad, the majority peruse only two goals: reelection and personal advancement. Combined, these create the paradox in which most politicians operate. On one hand, they must placate their constituents, and on the other, they must work with their cohorts to acquire power and climb the political ladder. More often than not, we hear politicians say one thing (to placate or divert us) and then vote another way. These individuals are not primarily concerned with our best interests but with their own self-interests and greed for power. If I had the choice, I certainly would not sign over $11,184 of my hard-earned money to any one of these individuals.
Allow me to clarify that I am not calling for tax evasion or for anarchy. However, if we continue down our current path, this country, our wallets and soon our healthcare, will be in the hands of individuals who care only for political advancement and personal wealth. Greed in government will always exist. Therefore, it must be checked by limits in government size and power. Government should be limited to providing basic services and have only the authority to protect its citizens from foreign and domestic harm. It is not the role of government to protect individuals from themselves; that is what mothers are for.
It is the duty of educated, ordinary citizens to relieve lifetime politicians from their positions and temporarily serve this great American country by actively participating in government through elections. While in office, these ordinary citizens will be greedy and self-serving. Since it is not their sole goal to be reelected, they have the ability do what is best for themselves, their families, neighbors and friends. When these individuals assemble, discuss and debate, they will be equipped with the needs and desires of normal citizens such as themselves. It is then, and only then that the focus of government will be on its people. De-legislation and the shrinkage of government could begin. Although I would not be any more willing to surrender my $11,184 to this form of government, I can only hope that my friends, family and neighbors would not ask for it.