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October 2, 2014 / 8 Tishri, 5775
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No Business Like Government Business

Once upon a time, Americans were shareholders of government. Today Americans are consumers of government.
IRS headquarters in Washington, D.C.

IRS headquarters in Washington, D.C.
Photo Credit: U.S.Department of Treasury

Our national government is essentially an insurance company attached to a bunch of national and international trade and regulatory groups. And that might be fine enough, if it actually worked. If it did work then senior citizens would never have to worry about their Social Security and local jobs would be protected against foreign competition. And when Islamists began destabilizing a country that we do business with, our Dutch East India Company with nukes would bomb them and their villages to oblivion, on a budget, before flying home for a celebratory dinner.

Beyond all the moral and political problems, there is the practical problem that the monster can’t do any of these things. It performs its functions like Frankenstein trying to take a flower from a girl’s hand. The flower gets crumpled and Frankenstein stomps off to smash things.

It can’t handle the insurance business, because it can’t control the temptation to spend all those piles of cash coming in. It can’t pay out the money again, because it is determined to spend giant chunks of it on social services to people who did not pay into it. And it can’t deliver any services in an efficient manner because its departments exist to employ incompetents who are bound by the rules to be even more incompetent than their actual inclinations, so that the system will be forced to hire even more incompetents on an annual basis.

As for national defense, forget about it. Frankenstein can react to threats after they happen. Mostly the military is lent out on a pro bono basis to humanitarian projects maintained by NATO, which like an international buggy whip manufacturer, exists with no purpose, and has instead decided to go into the business of preventing trendy genocides and is absolutely terrible at that as well. The whole thing is rolled into the United Nations, which is like one of those dot com companies that are supposed to be the next big thing, but never becomes the next big thing, but keeps raking in piles of money from investors while promising to one day revolutionize absolutely everything.

The big conflict with our grand corporation is conflict of interest.

First, the corporation is far more beholden to its suppliers of services than its consumers of services. This is a significant problem because it means that the cost of providing those services is constantly becoming more expensive and the corporation keeps nodding its head at the inflated product and labor figures presented by its suppliers.

Between the internal inefficiency and the unwillingness of the corporation to hold the line with its suppliers, the financials are impossible, and the corporation is currently running an annual trillion dollar deficit. It keeps raising its compulsory prices, but there is no reason to think that it can function within any conceivable budget because its boards, its executives and its suppliers simply adjusting their spending to match the available funds and then go twenty or thirty percent higher.

More money doesn’t mean better or even workable government. It means the corporations and unions who are on the inside will take more money home and next year there will be an bigger deficit, because like a dumb beast, the system will eat as much as you give it. It will not stop, because there is no profit motive for the individuals running things to stop. They can only make money by spending money and they don’t have to make money to spend money because they control the cash flow..

On paper, the corporation exists to provide services to customers. In practice it exists to provide wealth to its boards, its suppliers and its employees. It is a non-profit, in the worst sense of the word, because its finances are unsustainable, it keeps going only by compulsively lying to everyone it owes money to, promising debtors that they will be repaid and customers that they will be served, while its insiders stuff their pockets full of stolen money.

This state of affairs is not unprecedented among corporations. It’s a familiar form of corruption being practiced on a truly epic scale.

Conflict of interest is completely natural. It is human nature for people to look after themselves and their friends first. It is also completely natural for a system to serve itself and to build its governance mechanisms in such a way that everyone on the inside gets paid and almost everyone on the outside gets screwed. It’s all natural, but so is murdering your neighbor for his camels and his wife.

About the Author: Daniel Greenfield is an Israeli born blogger and columnist, and a Shillman Fellow at the David Horowitz Freedom Center. His work covers American, European and Israeli politics as well as the War on Terror. His writing can be found at http://sultanknish.blogspot.com/. The views expressed in this blog are solely those of the author and do not represent the views of The Jewish Press.


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