Big Government Versus Big Business

posted at 2:39 pm on July 13, 2009 by Doctor Zero

Every species of liberal hates and fears big corporations. Conservatives are often amazed that liberals could place so much faith in Big Government, when it has such a horrific record of producing waste, corruption, and bloodshed, around the world and across the decades. One of the keys to understanding the Left is appreciating their conviction that either Big Business or Big Government will inevitably control American life, and they very much prefer the latter.

Both Big Government and Big Business emerged from the rapid industrialization and urbanization of the nineteenth century. Heavy industry provided irresistible economies of scale to both large businesses, and large concentrations of population. You can’t manufacture heavy machinery, refine gasoline, or produce industrial-grade steel at small local mom-and-pop operations, for consumption by a purely local market. Local craftsman can’t match the productivity of big manufacturing plants. The Industrial Revolution produced a huge number of factory jobs, and the population flowed into urban areas to take them. This had a profound effect on both the quality of life, and the shape of politics.

The twentieth century brought the rise of various political movements that believed industrial science could be used to shape human relations. There was a great deal of faith in the power of science to engineer an ideal society, filled with perfect citizens. All those people crammed into cities and factories were crying out to be organized, much as the factory machinery was carefully engineered to exacting specifications. The leading intellectuals of the pre-war era were almost unanimous in their belief that scientific methods should be used to create a powerful, super-intelligent central state, which would organize the citizens for maximum efficiency.

Economies of scale continue to provide incentives for corporate growth. The phenomenon of Wal-Mart, and other big-box retail operations, is based on the concept of purchasing goods in vast quantities, so they can be resold at a discount in large, no-frills stores. Huge electronics companies have created amazing devices, which they manufacture and sell at remarkably low prices. The pioneers of the personal computer may have created their first crude machines in garage laboratories, but no one could have designed and built an iPhone that way. The Left sees this inexorable movement toward large corporations as a frightening development, and feels that only an even larger and more powerful government protects them from mega-corporate greed.

Conservatives wonder how liberals could possibly be willing to sacrifice their liberties to a huge central government. The Left views many of these liberties as dead letters, or dusty antiques, in a world of huge corporations and high technology. Liberals are much more interested in “positive rights,” or entitlements – the “right” to food, housing, health care, and so forth. What good is the “right” to choose your own doctor, when average folks understand nothing about medicine, and are prone to being ripped off by Big Pharma and its billion-dollar ad campaigns? How can people be held responsible for defaulting on their credit card debts, when Big Credit fooled them into accepting credit limits they couldn’t sustain, at interest rates they can never repay? To the Left, ordinary citizens are helpless pawns in the schemes of immense, predatory corporate interests.

Of course, Big Government is larger, more powerful, and more destructive than any company could ever dream of being. Liberals often cite Microsoft as the ultimate example of corporate evil, falsely describing it as a monopoly. (A “monopoly” is not a very rich company with few serious competitors.) No matter what you think of Microsoft, it cannot actually force you to buy its products, or legally bar other companies from offering competing products. The government can do those things. Ford Motor Company can’t apply tariffs against foreign automobiles, rearrange safety and fuel standards to make competing vehicles prohibitively expensive to the consumer, or seize money from people who aren’t its customers to subsidize its business practices. The new owners of General Motors can.

Why does the Left embrace Big Government, despite its fearsome track record? Because they believe citizens have some influence over the government, but none over private industry. The act of voting for political leaders grants them a moral legitimacy that private companies can never have. The collectivist philosophies of the past century are based on the concept of government as the incarnation of the popular will. The State is the avatar of the people, and its officials are directly answerable to the voters, who can send them packing if they dislike their policies. Liberals hate big corporations because the common man is not consulted when CEOs are appointed. You’ll never be more than a registration number to Microsoft, but every few years, you get to march into the voting booth and make your voice heard by politicians!

To accept this argument, one must ignore the role of money as a form of communication. As one of the characters in Ayn Rand’s “Atlas Shrugged,” puts it: “When money ceases to become the means by which men deal with one another, then men become the tools of other men. Blood, whips and guns–or dollars. Take your choice–there is no other.” The private sector’s response to monetary incentives is much faster, and more efficient, than government’s response to elections held every few years. Barack Obama claims a mandate to restructure the entire relationship of citizens to their government, after winning the support of about 33% of eligible voters. No private company would count the support of only 33% of its potential market as a soaring success, or consider it a mandate to restructure the entire marketplace. For a national politician, 60% approval ratings are called “stratospheric.” For a national corporation, 60% consumer satisfaction is a disaster.

The idealistic vision of concerned voters using their ballots to restrain incompetent or malevolent politicians is nothing but a comforting illusion. A great deal of power over your life is wielded by long-term senators and representatives from states where you have no vote. If you aren’t one of the roughly 300,000 voters in Massachusetts District 4, you have absolutely no influence over Barney Frank, the man who engineered the subprime market collapse. If you hate the President’s policies and want him out of your life, but 51% of the country disagrees in the next election, you’re stuck. In fact, if it’s a three-party race like 1992, your passionate opposition could be over-ruled even if a sizable majority of the country agrees with you. The popular fantasy of politicians as “employees” of the voters, who can “fire” them if they under-perform or misbehave, is dangerous because it has made people comfortable with giving up far too much of their freedom.

Big Government’s unresponsiveness is exceeded only by its inefficiency. Government programs expand through failure. A bureaucrat only gets more funding if he can show his past year’s funding was insufficient. Private companies are always hungry to increase sales and market share, which gives them a constant incentive to provide value for money. Corporate managers can’t lay out failed projects and stagnant growth at a board meeting, and expect to receive big bonuses and increased funding… but that is exactly how Big Government works.

The liberal phobia about Big Business leads to the false premise that Americans must choose between having their lives run by either corporations or the government. Big Business isn’t trying to send inspectors into your house, to make certain you’re using the right kind of light bulbs. Americans should strive to ensure their government is small, transparent, and tightly focused on both enforcing and respecting the law. A vibrant, free economy gives us the wealth to attend to the needs of the poor, and take proper care of the environment. Large companies are an inevitable byproduct of that prosperity. Those companies must be policed, the same as private citizens must be policed, for no one is truly free in a state of anarchy. Learning to fight the irrational fear and hatred of Big Business is a vital endeavor, because it causes far too many people to flee into the waiting arms of Big Government… a far more powerful, predatory, and uncontrollable beast.

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