Economics and Government

Arnold Kling provides a primer on government and individual liberty:

Consider the following classification system for government regulations and programs.

(a) interventions that work so much better than private alternatives that we feel grateful for them
(b) interventions that are better than private alternatives in some ways and worse in others
(c) interventions that are mostly worse than private alternatives
(d) interventions that are evil

Libertarians look at government and see interventions that are mostly in categories (b), (c), and (d). I would put municipal fire departments in category (a), government water treatment in category (b), public education and Social Security in category (c), and protectionist trade measures such as the Byrd Amendment in category (d). Where the United States is really lucky compared with countries like Zimbabwe is that those other countries' government interventions are predominantly in category (d).

My sense is that non-libertarians view interventions as fitting mostly into categories (a) and (b), and they believe that the programs that they favor are all category (a). I believe that their attachment to government interventions owes more to wishful thinking than to a realistic assessment of results. My reading of history is that progressives tend to exaggerate both the need for government interventions and the likely results of such interventions.

I believe that you will find that when government power is held in check, people solve problems by creating institutions that are less coercive and more effective. That is not a utopian vision. It is not an irrefutable proof. But for me, it is a sound basis for libertarianism.