"profit-seeking government aligns with one-party government. And one-party government tends to degenerate."
What this analysis misses is the case of the 21st c. Western "O" type government. To its critics (and I am one) it too has degenerated.... into farce. Here's how: you still have a pluralist electoral democracy but just as a kind of plaything....part of the media entertainment industry. Meanwhile the real government is a permanent and almost unchallengeable techno-bureaucracy constantly topped up by 'experts' emerging from its 'one-party' universities.
I find it interesting that some people are deeply troubled by racism and white oppressors. Others find our government a farce or or education totally failed. I think I understand where these emotions come from but while recognizing plenty of problems exist, I find the extreme positions equally absurd.
Are we sure about this: "in the United States, it is difficult for a new political party to succeed. But you will not be thrown in prison for trying"? If, as many say, Donald Trump "blew up" the Republican party and is building a new party . . . is not the currently-ruling party literally trying to throw him in jail?
Yeah Arnold is wrong here, modern prisons and US history are littered with political prisoners who attempted to start their own political party, unseat a current politician, or influence the government from Eugene Debs to Jan 6th to Fritz Kuhn to Jefferson Davis. At municipal levels politicians routinely use the police and prosecutors to jail rivals.
I am having difficulty seeing the difference between ‘modern’ Type O Government and Type L. Both maintain their position by having the monopoly on violence - the notion that citizens ‘accept’ the legitimacy of Type O, is moot. I certainly don’t! They are just self-legitimised Mafia. Other details are just a case of you say tomeyto, I say tomahto. The reason why government services - such as they are - are not delivered by private enterprise in the competitive free market, is because the sort who gravitate to government want power, control and plunder and they would lose this if the private sector provided what citizens want. It is however worth noting, there is not a single thing Government does that was not hitherto provided by the private sector (includes not-for-profit, community organisations, charities) until appropriated by Government.
A great example is the UK’s health system. Until the 1911 National Insurance Act, 75% of the population had private health insurance vis mutuals, friendly societies, union schemes, local community schemes. Most British hospitals - those that haven’t been closed - were built prior to 1900.
Those not insured were covered by the Poor Law, charities and pro-bono. The NIA did nothing for these, but forced workers and employers to pay into the State scheme. In 1948 the National Health Service was launched - it didn’t build its first hospital until 1963. All its hospitals were built prior to WWII, most prior to WWI, with the bulk in the 18th 19th Century and some earlier, 12th Century in the case of St Bartholomew’s Hospital London. So it just nationalised what was there.
Currently there are 7 million people waiting for hospital treatment, and the average time to get a diagnostic test - radiology, lab test etc, is 47 days with 10 to 14 days wait to see a primary physician. But it’s ‘free’ so that’s OK. The most incredible thing is, nobody actually knows how much it’s costing them because the supposed National Insurance Contribution does not cover the entire cost, so it is mostly paid out of general taxation and free at point of delivery - no comfort if you are 7 millionth on the waiting list.
For profit government reminds me of the quote by Adam Smith in Wealth of Nations:
"People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."
When I think of profit seeking organizations that work closely with governments, I think of for-profit, privately-run prisons, which have a very poor reputation.
In Government run operations the politicians and employees collude to increase the budget and to make certain the problem served by the operation only grows larger. The employees reward the politicians for the money they divert to the operation, regardless of results. Your two prime examples being Public Education and the Public University system.
In Private Enterprise, government funded operations, the politicians and corporations collude to increase the budget and to make certain the problem served by the operation only grows larger. The corporations reward the politicians for the money they divert to the operation, regardless of results. Your two prime examples being the Industrial Military Complex and the Industrial Medical Complex.
Perhaps we need to look at failure mechanisms. Death is required for evolution to work. The "O" type often has a death mechanism of bankruptcy which allows a graceful death. The "L" type only has total collapse or conquest to control the natural evolution of incompetent institutions.
We need to add a death mechanism to government monopolies that will allow institutions like "Bureau of Indian Affairs" to fail when they fail to achieve their objective of helping the Indians become successful in our society.
Both nature and humanity require failure to evolve.
Curious any thoughts on QAGOs and how or if they could factor into this. Just something you really never hear economists or libertarians in the US talk about given the rarity of QAGOs here
The United States has a long history of a third form of governance that is closer to for-profit government than L- or O-types - company towns run largely of, by, and for a dominant employer. To name a few over the years if not currently - Rochester NY (Kodak); Detroit ("Motor City"); the State of Delaware (DuPont); Hershey, PA; New Haven, CT (Yale U. and Yale-NH Hospital). Although many of these cities have declined, they were successful (for their patron companies for long periods.
"As long as the general public feels a combination of comfort with their condition and fear of the force of government, the L will not face rebellion."
Rebellion can also come from the forces of the government, as in armed forces. This changes the calculation in that:
- Type L governments are _not_ completely free to take what they want from their subjects. They have to assume a disgruntled colonel might decide to be the liberator of its subjects and organize a coup, and the more exploitative the government the more likely it is for a group of officers to decide on a coup.
- Type L governments must weight how much resources to allocate to its armed forces in order to keep them happy. More resources means more extraction from the general public, and maybe higher likelihood of cliques with a propensity for executing a coup. Less resources means you could end up like Muammar Gaddafi.
There’s no govt need to be profit seeking, they can print or borrow as much as they need, or want.
It would be an excellent test of the theory if private or charter cities were allowed, but “sacred” issues Robin defines will remain an obstacle. In the meantime, most American kids don’t yet have an option to choose a private school for the same price. Govt vouchers per student for school is a good, big step—fiercely opposed by Dem teacher unions who prefer lousy Dem govt schools rather than better non-govt schools. Because they believe govt is better, sort of like government is sacred.
Open Societies are a function of Social Trust. You have to trust that, should the other guy get one up on you, it's not the end of the world. Part of that is not seeing him as too much of "the other", but more like the Lost Boys and the Indians in Peter Pan see each other.
That's a hard thing to manage though. It's not enough to say "TRUST" because you also have to punish bad actors to maintain trust or the wolfs eat the sheep.
"profit-seeking government aligns with one-party government. And one-party government tends to degenerate."
What this analysis misses is the case of the 21st c. Western "O" type government. To its critics (and I am one) it too has degenerated.... into farce. Here's how: you still have a pluralist electoral democracy but just as a kind of plaything....part of the media entertainment industry. Meanwhile the real government is a permanent and almost unchallengeable techno-bureaucracy constantly topped up by 'experts' emerging from its 'one-party' universities.
I find it interesting that some people are deeply troubled by racism and white oppressors. Others find our government a farce or or education totally failed. I think I understand where these emotions come from but while recognizing plenty of problems exist, I find the extreme positions equally absurd.
The for profit government seems intellectually related to Paul Romer's idea of charter cities,
which https://chartercitiesinstitute.org/ is trying to bring about. Relevant substack here: https://magatte.substack.com/p/fasten-your-seat-belts-we-are-bringing
I am not sure the profit here is more than just an increasingly prosperous tax base, but
would that be enough. I really want this to work, and not be just the latest in a series of ways to waste money not improving lives in Africa.
Are we sure about this: "in the United States, it is difficult for a new political party to succeed. But you will not be thrown in prison for trying"? If, as many say, Donald Trump "blew up" the Republican party and is building a new party . . . is not the currently-ruling party literally trying to throw him in jail?
You could say the same of Elon Musk. Is there a single one of his companies or an ounce of his personal finances that aren't being sued.
Yeah Arnold is wrong here, modern prisons and US history are littered with political prisoners who attempted to start their own political party, unseat a current politician, or influence the government from Eugene Debs to Jan 6th to Fritz Kuhn to Jefferson Davis. At municipal levels politicians routinely use the police and prosecutors to jail rivals.
A glance at the headlines confirms America is already deep into organized crime. Dissidents jailed, independent press silenced, and enemies amerced.
Letters aside, history shows the authoritarian form lasts generations, because traditions and social institutions limit the exercise of power.
Totalitarian regimes, unrestrained, fail faster; USSR in 1987, and PRC in 2025.
At the other end, no pure democracy escapes swift ochlocracy and ruin. One-man, one-vote, one-time.
After a quarter-millennium, our democratic Republic is slipping fast, but not yet beyond hope.
I am having difficulty seeing the difference between ‘modern’ Type O Government and Type L. Both maintain their position by having the monopoly on violence - the notion that citizens ‘accept’ the legitimacy of Type O, is moot. I certainly don’t! They are just self-legitimised Mafia. Other details are just a case of you say tomeyto, I say tomahto. The reason why government services - such as they are - are not delivered by private enterprise in the competitive free market, is because the sort who gravitate to government want power, control and plunder and they would lose this if the private sector provided what citizens want. It is however worth noting, there is not a single thing Government does that was not hitherto provided by the private sector (includes not-for-profit, community organisations, charities) until appropriated by Government.
A great example is the UK’s health system. Until the 1911 National Insurance Act, 75% of the population had private health insurance vis mutuals, friendly societies, union schemes, local community schemes. Most British hospitals - those that haven’t been closed - were built prior to 1900.
Those not insured were covered by the Poor Law, charities and pro-bono. The NIA did nothing for these, but forced workers and employers to pay into the State scheme. In 1948 the National Health Service was launched - it didn’t build its first hospital until 1963. All its hospitals were built prior to WWII, most prior to WWI, with the bulk in the 18th 19th Century and some earlier, 12th Century in the case of St Bartholomew’s Hospital London. So it just nationalised what was there.
Currently there are 7 million people waiting for hospital treatment, and the average time to get a diagnostic test - radiology, lab test etc, is 47 days with 10 to 14 days wait to see a primary physician. But it’s ‘free’ so that’s OK. The most incredible thing is, nobody actually knows how much it’s costing them because the supposed National Insurance Contribution does not cover the entire cost, so it is mostly paid out of general taxation and free at point of delivery - no comfort if you are 7 millionth on the waiting list.
For profit government reminds me of the quote by Adam Smith in Wealth of Nations:
"People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."
When I think of profit seeking organizations that work closely with governments, I think of for-profit, privately-run prisons, which have a very poor reputation.
You mean compared to the good reputation of prisons operated directly by the government?
What's the difference?
In Government run operations the politicians and employees collude to increase the budget and to make certain the problem served by the operation only grows larger. The employees reward the politicians for the money they divert to the operation, regardless of results. Your two prime examples being Public Education and the Public University system.
In Private Enterprise, government funded operations, the politicians and corporations collude to increase the budget and to make certain the problem served by the operation only grows larger. The corporations reward the politicians for the money they divert to the operation, regardless of results. Your two prime examples being the Industrial Military Complex and the Industrial Medical Complex.
Perhaps we need to look at failure mechanisms. Death is required for evolution to work. The "O" type often has a death mechanism of bankruptcy which allows a graceful death. The "L" type only has total collapse or conquest to control the natural evolution of incompetent institutions.
We need to add a death mechanism to government monopolies that will allow institutions like "Bureau of Indian Affairs" to fail when they fail to achieve their objective of helping the Indians become successful in our society.
Both nature and humanity require failure to evolve.
Curious any thoughts on QAGOs and how or if they could factor into this. Just something you really never hear economists or libertarians in the US talk about given the rarity of QAGOs here
The United States has a long history of a third form of governance that is closer to for-profit government than L- or O-types - company towns run largely of, by, and for a dominant employer. To name a few over the years if not currently - Rochester NY (Kodak); Detroit ("Motor City"); the State of Delaware (DuPont); Hershey, PA; New Haven, CT (Yale U. and Yale-NH Hospital). Although many of these cities have declined, they were successful (for their patron companies for long periods.
Actually, you do see profit-seeking governments. They're called "malls".
"As long as the general public feels a combination of comfort with their condition and fear of the force of government, the L will not face rebellion."
Rebellion can also come from the forces of the government, as in armed forces. This changes the calculation in that:
- Type L governments are _not_ completely free to take what they want from their subjects. They have to assume a disgruntled colonel might decide to be the liberator of its subjects and organize a coup, and the more exploitative the government the more likely it is for a group of officers to decide on a coup.
- Type L governments must weight how much resources to allocate to its armed forces in order to keep them happy. More resources means more extraction from the general public, and maybe higher likelihood of cliques with a propensity for executing a coup. Less resources means you could end up like Muammar Gaddafi.
There’s no govt need to be profit seeking, they can print or borrow as much as they need, or want.
It would be an excellent test of the theory if private or charter cities were allowed, but “sacred” issues Robin defines will remain an obstacle. In the meantime, most American kids don’t yet have an option to choose a private school for the same price. Govt vouchers per student for school is a good, big step—fiercely opposed by Dem teacher unions who prefer lousy Dem govt schools rather than better non-govt schools. Because they believe govt is better, sort of like government is sacred.
Open Societies are a function of Social Trust. You have to trust that, should the other guy get one up on you, it's not the end of the world. Part of that is not seeing him as too much of "the other", but more like the Lost Boys and the Indians in Peter Pan see each other.
That's a hard thing to manage though. It's not enough to say "TRUST" because you also have to punish bad actors to maintain trust or the wolfs eat the sheep.