Looking at history, it is evident that contemporary governments worldwide are becoming increasingly complex and pervasive. Under the guise of representing the constituency, politicians seek to regulate minute aspects of ordinary affairs, resulting in complicated and inefficient bureaucracies.
Economic interventionism is the driving cause behind the emergence of extensive governments. Interventionists argue that free markets necessarily lead to market failure, harmful externalities and anticompetitive practices. Regulated markets enforced by antitrust legislation therefore restore and maintain optimal efficiency.
Under Keynesian economics, short-run economic output is strongly influenced by aggregate demand, which in turn depends on government expenditures. As such, Keynesians assert that increasing government spending will increase the economic output, thereby helping the economy recover from recessions.
Both arguments are misleading. As long as a market economy continues to operate freely, market failures are avoidable, since consumers can readily choose the cheapest alternatives, while producers can maximize profits. Monopolist firms engaging in predatory pricing discourage rational consumers and motivate entrepreneurs to capture lost surplus.
Even if market failure is inevitable, government regulation can lead to disastrous outcomes. Governments lack a profit motive, so there isn’t an incentive for regulators to improve services. Under regulatory capture, government agencies promote the interests of the firms in the industry being regulated, thereby resulting in negative externalities.
Keynesians may be correct to emphasize the importance of aggregate demand, but government expenditures aren’t an adequate solution. Consumption and investment show strong positive correlations with business cycles, but government spending is uncorrelated. Government spending also crowds out and thus lowers investment spending, undermining aggregate demand.
Consequently, economic interventionism is unnecessary, indicating that governments must be reduced drastically. Yet, there is another problem: civil rights and defense. If people are reasonable and self-sufficient, they can voluntarily protect natural rights. Moreover, all disputes can be resolved through a patient and evenhanded discussion.
According to the nonaggression principle, individuals can make their own choices as long as they don’t involve aggression, namely the initiation of fraud or force, against others. If aggression is irrational, defense is unnecessary. Education, healthcare and social services can all be provided by voluntarism.
If voluntarism and nonaggression can promote social progress, government can be abolished, leading to sustainable anarchism. Now, anarchism emanates misconceptions of chaos and disasters. Critics pinpoint the infamous example of revolutionary anarchy during the Russian Civil War, even though these “anarchists” were irrational and paranoid.
Detractors also inaccurately claim that anarchists oppose all rules and laws. Such an assertion contradicts the concept of natural rights and natural laws, both of which are entirely independent of jurisdiction. Anarchists simply oppose rules and laws that are involuntarily imposed on society by illegitimate authorities, such as governments.
Anarchism eliminates the need for voting and civic duties, thereby avoiding controversies that arise from decisions made by a majority rule. Rationalism and self-sufficiency also lead to altruism, since individuals can enjoy the satisfaction in improving the wellbeing of the overall community. Hence, anarchist societies tend to promote low-cost living.
Economics strongly influence anarchism, resulting in two broad subdivisions. Anarcho-capitalism underlines the importance of free market, private property and individualism. Anarcho-capitalists oppose taxation, asserting that privately funded competitors can manage all security and social services.
Anarcho-socialism emphasizes social equality, arguing that individualism inherently depends on mutual benefits. While respecting personal property, anarcho-socialists believe the most optimal society will consist of a complete conversion of private property to public goods.
Semantically speaking, these subdivisions are improperly named. Most anarchists argue that anarcho-capitalism is a meaningless term, since capitalism intrinsically requires involuntary transactions. Likewise, anarcho-socialism seems oxymoronic, since conversion from private to public property will face individual opposition and thus requires the use of force.
The controversy in terminology simply indicates that anarchism is a diverse political philosophy, since the criteria constituting an ideal, stateless society are entirely subjective. Regardless of semantics, it is evident that anarchism creates the optimal society in theory. In practice, anarchy is impossible to sustain.
Anarchism fails because humans are not innately rational and self-sufficient. On the contrary, humans are driven by instinct, a characteristic shared by all animals and derived from evolution. Reason is a recent evolutionary trait that is unique to humans.
Sigmund Freud asserted that instinctual desires are characteristics derived from birth. Parents must impose moral and cultural norms in order to ensure the successful development of children into successful adults. Expanding from individual to society suggests that the state serves a critical regulatory role to nurture social progress.
In “Federalist No. 51,” James Madison boldly declared, “If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary.”
Madison and Freud both accurately pointed out that people are far from angels, confirming that people are inherently irrational beings. Thomas Paine admitted that the government was “a necessary evil” to regulate irrationality. Conversely, governments run by people are fundamentally irrational if left uncontrolled.
The solution proposed by Madison requires the government to control the governed, while also governing itself. This is analogous to Freud’s structural theory of psyche, whereby the ego maintains the delicate balance between the id (instincts) and the superego (regulations).
Hence, the optimal political structure in practice is a limited government, which is also called minarchism. Minarchists argue that governments should focus primarily on basic roles, such as protecting the individuals from aggression, as well as providing common defense and neutral judiciary.
Minarchism in the United States is achieved by strictly following the Constitution. By imposing political term limits, downsizing the bureaucracy and privatizing many public programs, corruption is reduced and efficiency can be achieved. Limited government is thus the only way to promote and maintain a sustainable and rational society.
Badri Karthikeyan is a senior biology major at Drexel University. He can be contacted at [email protected].