The Organized Crime Called Government
The Survivalist’s Guide to ‘Obammunism’ & Beyond
by Ilana Mercer
March 11, 2013
“No statist lies are safe from his scrutiny,” writes Lew Rockwell about economist Thomas J. DiLorenzo’s latest book. What follows is my conversation with professor DiLorenzo about Organized Crime: The Unvarnished Truth About Government, and the timeless economic truths to which it speaks.
1. ILANA MERCER: A microscopic decrease in the increase in government spending has sent our overlords in DC into apoplexy. A cut in oink-sector spending, they’re claiming, will destroy the chances of an economic recovery. It is the exact opposite. You point this out in the chapter on “The Myth of Government Job Creation”: “Government spending increases unemployment because it crowds out so much private sector job creation” (p. 202). Explain with reference to the zero-sum nature of government spending – the cost of a government job, and Bastiat’s “What-Is-Seen-and-What-Is-Not-Seen” principle.
THOMAS DILORENZO: Every dollar that the government spends is a dollar that is not spent (or saved) by individuals, families, businesses, and entrepreneurs. Therefore, whenever government grows, private enterprise – the sole source of real job creation – shrinks and unemployment there rises. Each government job destroys several genuine, private sector jobs because of all the bureaucracy and red tape. For example, government may spend $200,000 to give one person a $30,000/year job. And government “jobs” are usually involved in doing something that no one but a few politicians ever voiced a preference for. Private sector jobs, by contrast, cannot survive unless they are part of an enterprise that succeeds in satisfying genuine consumer wants. By contrast, Keynesians like Paul Krugman would have us believe that prosperity is created whenever government takes money out of our bank accounts (with the threat of forcing us to live in a cage for years if we do not pay) and letting government bureaucrats squander the money instead. Part of the Keynesian mantra is that such spending could and should be on “anything” – it doesn’t matter, as long as it is government that is doing the spending. The biggest year of private sector economic growth in American economic history was 1946 when the nation was in the middle of a two-thirds reduction in federal government spending as the military was demobilized from World War II. This proves that the Keyensians were always dead wrong, but of course they and their political patrons ignore this reality.