Government Stolen Goods

The standard discussion of public goods that we find everywhere should be confronted not only with libertarian critiques, such as the one by Hoppe in “The Economics and Ethics of Private Property”, but also by another category of goods, namely, GOVERNMENT STOLEN GOODS.

In the course of his detailed analysis of the fallacies of public goods theory, Hans-Hermann Hoppe criticizes the theory’s attempted distinction between private and public goods. “Certain goods or services (including security) are said [by public goods theorists] to be special because their enjoyment cannot be restricted to those who have actually financed their production. Rather, people who do not participate in financing them also draw benefits from them. Such goods are called public goods or services (as opposed to private goods or services, which exclusively benefit those people who actually pay for them).” Hoppe shows that the distinction is untenable.

The economists who dreamed up the fallacious idea of public goods, an idea construed as supporting State interventions in free markets, failed to point out that there is another logical category of goods, namely, GOVERNMENT STOLEN GOODS, where the theft is by the government. Isn’t it odd that such smart economists like Paul Samuelson didn’t realize this or point it out? They had a blind spot when it came to government. Murray Rothbard pointed out the importance of taxes being theft. He also used the terminology of taxpayers and tax consumers.

There are 4 possibilities:

1. Group V pays, and group V benefits fully (private goods).
2. Group V pays, and group V benefits fully and group U also benefits (public goods)
3. Group V pays, and group V partly benefits and group U also benefits (stolen goods)
4. Group V pays, and group V doesn’t benefit and group U benefits (stolen goods)

We need to consider goods and services which are paid for by one group of people that does not benefit fully or at all, while the benefits go to groups that didn’t pay (lines 3 and 4 above). Murray Rothbard called these two groups, taxpayers (group V) and tax consumers (group U), respectively.

Hoppe shows the fatal problems in theoretical efforts by public goods theorists to distinguish lines 1 and 2. There is, however, no problem in identifying the category of GOVERNMENT STOLEN GOODS in lines 3 and 4. This occurs whenever people in group V are forced by government to pay and subjectively assess the corresponding benefits as being worth less than the amounts extracted from them, which go to finance the people in group U.

Governments in America and elsewhere absorb half the gross domestic product, which means 50 percent of our income. If half of this 50 percent comes back to us in the form of benefits, then the amount of GOVERNMENT STOLEN GOODS is 25 percent of our income. No one knows or can determine the actual amount that’s stolen. Not only that, but the amount stolen prevents the financing of projects we consider worthwhile but become unable to finance because of the theft. Hence, the losses are greater than what we might get back, of which 25 percent is a generous guess. Adding those opportunity losses back to the 25 percent, my guess is we are right back to 50 percent of income being STOLEN.

GOVERNMENT STOLEN GOODS are actually the elephant in the room.


8:53 pm on April 24, 2018