This is a chapter from a book I’ve never read in whole, written by George Roche. This chapter once appeared as a stand-alone booklet published by the Mackinac Center for Public Policy, and to this day I think accurately describes how Public Choice Theory plays out in practice better than any other. It presents a plausible hypothetical that reveals the inescapable, fundamental dysfunction of all government programs.
Granted that work (and especially paperwork) is elastic in its demands on time, it is manifest that there need be little or no relationship between the work to be done and the size of the staff to which it may be assigned . . . . Politicians and taxpayers have assumed (with occasional phases of doubt) that a rising total in the number of civil servants must reflect a growing volume of work to be done. Cynics, in questioning this belief, have imagined that the multiplication of officials must have left some of them idle or all of them able to work for shorter hours. But this is a matter in which faith and doubt seem equally misplaced. The fact is that the number of officials and the quantity of work are not related to each other at all.
—C. Northcote Parkinson
The U.S. Office of Education was a tiny, fact-finding body in 1939 when it was incorporated into a new, larger bureau called the Federal Security Agency. Few remember what the FSA was, but everyone is thoroughly familiar with what it became. After fourteen years, the FSA was promoted to the cabinet and changed its title to the U.S. Department of Health, Education, and Welfare. It began life with a budget of about $4 billion. After another twenty-six years, its budget now approaching $200 billion a year, HEW was seen to be great with child. And like some colossal whale calving, it was delivered of a whole new Department of Education. In forty years of gestation, the tiny education bureau had grown into a cabinet department with 152 offices of its own and a budget of $12 billion. For starters. Its compound growth rate for the period must have outstripped a Ponzi game.
This is a choice but by no means unusual example of a phenomenon we must explain. Why does bureaucracy inevitably grow and grow and grow? We have looked at endless examples of its handiwork, and find them to be frustrating, wasteful, rigid, harmful, ominous, and ins~ane. We certainly cannot explain bureaucratic growth by its great and good works. We have peered deeply into its origins, but this does not explain the growth factor either; we have not seen any rousing public welcome for nomad warriors. We have looked into its political nature. Can we explain bureaucratic growth by this country’s great love for politicians? Not exactly. What force is it then that can convert one little bureau into 152 clones and cabinet status? Something must account for bureaucratic growth, for grow it does, despite its being universally detested; despite all the harm and waste it causes.
Professor Parkinson offers an amusing insight about why we put up with an expanding bureaucracy. We are simply assuming that all those bureaucrats are there to do something. This, he points out, is a terrible mistake. When we see a whole legion of bureaucrats, we assume they are doing something very important—an even greater blunder. There is no basis at all for such assumptions. Bureaus, as we have seen, do not operate in the world of doing things with concrete purpose and clear goals. Their only purpose is to be what the reigning politicians say they should be, and move as far as they can up toward the fat end of the public trough. Certainly they are not there to “do something important” as the rest of us would understand the term. Nor does the number of bureaucrats, however great, mean anything, as Professor Parkinson observes. The work in a bureau has no relation whatsoever to the number of people who do it. For all anyone knows, millions of bureaucrats are employed to send each other memos. From all the reports I get, this seems to be exactly the case. Since any number can be employed in useless paper shuffling, it is clear enough that Parkinson is right, and that there is no relation between warm bodies and work. We eliminate workload as a factor in bureaucratic growth.
Yet here we have two solid hints at factors that do indeed promote bureaucratic growth despite its cost to society. The first is simply greed—that impulse to move up to the fat end of the trough. To get a fat salary for doing nothing. To live off the people. This impulse, combined with the license to steal that is the State, has catastrophic implications for humankind.
The second hint has to do with the way bureaucrats attain power and position. Bureau chiefs are paid, and their agencies are funded, according to how many warm bodies they command. It is obviously in their interest, therefore, to round up all the warm bodies possible, never mind if the personnel do anything. To do this, the administrator need only persuade Congress that he is doing great things; and his success in acquiring warm bodies is already evidence of this. Everything else, the increase in pay and prestige, is built into the law.
There are other and I think equally valid ways of looking at the factors of bureaucratic growth. Any of them is sufficient to explain the growth, but all offer different insights. Best, then, to consider the several growth theories systematically, one after another.
As we’ve seen, the first, and saddest, theory reduces to human greed, or more precisely, greed armed with a gun. We will return to this for serious discussion, for it is profound and far-ranging.
The second explanation is that growth is mandated by law. Ponder the proposition that the rank of a military commander is determined by the size of his command. Command of a company goes to a relatively inexperienced captain; of a regiment, to a more seasoned colonel; of a brigade, a brigadier general, who has even more experience. All this is perfectly sensible and logical. Yet there is a kicker in it, which is: all the pay and prestige of the position are based on the rank, and so derive from the number of people in the command. This poses no problem worth mentioning in the armed services; a commander cannot increase the size of his unit at will. But it is disastrous in civilian bureaus, which have the same arrangements for pay and promotion. In a civilian bureau, you can increase the number of employees with some ease, and this, as we’ve seen, has no bearing on the bureau’s work. The temptation to add to one’s own position as an administrator by hiring more people is ever present and naked. This all but guarantees all manner of finagling to increase bureaucratic personnel and size. So what if taxpayers get soaked in the process?
A third, and closely related, explanation is the self interest of the State. This accounts for the fact that the State and society are not congruent, but rather are enemies, an us-or-them proposition —certainly true of the Old World State, if not the limited constitutional government devised in America. It follows that the State will always protect and enhance its own interests, at the expense of the interests of society. The State’s own internal mechanisms are designed to serve its interests, including that of awarding rank by size of command, as just discussed. More important, its interest and its power depend on extending its reach and controls over society as far as possible. It therefore does everything it can to expand bureaucracy and its rules, a relatively easy matter, since it is in the driver’s seat. All this expands its power and serves its interests.
Every State in history has behaved just this way, and there is no doubt that this explanation carries immense weight. And the State reasoning is impeccable, save for one fatal flaw: it forgets that it is parasitic, and that if it sucks the blood out of society, it too will die. Apparently the State’s pride and glory blind it, for this inevitably is its end.
A fourth explanation might be called the drug addiction theory of bureaucracy. It can be stated as follows. Every bureaucratic intervention (“fix”) where it does not belong causes economic damage and dislocation. This will create a need, or at least provoke an outcry, for new interventions to correct the damage. Another “fix.” The bureaucracy intervenes again, ineluctably doing more damage, provoking yet further outcry, and so on. In this process, society becomes progressively more dependent on the bureaucratic drug, even as the drug ravages the social body. Again, there is a great deal to this. Such writers as Nock and Rose Wilder Lane have explored this phenomenon down to its deepest roots in natural law and human psychology, so there is no point in my repeating their findings. (19) One really need only recognize the counterproductive, anti-economic nature of bureaucratic measures to see how—and that—it works.
Rose Lane, who later became one of the great defenders of American liberty, was in early life a theoretical communist who observed first-hand the functioning of the young Soviet Union and other socialist experiments. From this experience she derived a view of bureaucratic growth that is similar to, but broader than, the drug addiction theory. We might call it the social resistance theory.
What Mrs. Lane observed is that a bureaucratic intervention not only causes damage, it provokes resistance. The State must then add to its police power and intervene again, to quell resistance. And she was exactly right. Her observations explain what the “drug addiction” theory alone cannot, namely, that the intervention process is one of growing police power and totalitarignism, with military dictatorship the end product. History bears her out to the letter.
* * *
Lastly, I have my own modest theory of why federal agencies swell up like toadstools on a rotting log. This theory rests on two fundamental principles I will call Roche’s first and second laws of bureaucratic growth. Namely: (1) The supply of human misery will rise to meet demand.
This simply extends the law of supply and demand, which everybody knows to be true, into a new and unexpected area: the bureaucratic “marketplace.” I reason that bureaucratic spending to “solve” any given social problem in truth represents dollar demand for more of just that problem. If we create a market for misery by paying good money for it, the supply of misery will rise to meet demand. You want the halt, the lame, the blind? We got ‘em. You want abject poverty? We got that on special this week.
Any honest social worker will confirm this phenomenon, from experience in the field. If Congress adjusts the qualifications for welfare—free money—potential recipients will adjust their lives to qualify. If Congress offers money to the disabled, the number of handicapped people rises, and amazingly, they can prove their disabilities. If Congress offers money to the idle, as with unemployment relief, workers will stay idle as long as it pays them to. If Congress gives money to the sick, it creates an epidemic. All this is immutable in the economic law of supply and demand. In short, when Congress, and through it the bureaus, demand misery— in precisely the economic sense of offering dollars for it —misery is what they get every time. A generous public does not understand this, but I doubt that the point is lost on bureaucracy itself.
Roche’s second law of bureaucratic growth is a refinement of the drug addict theory of bureaucracy, and goes like this: (2) The size of the bureaucracy increases in direct proportion to the additional misery it creates. Bureaucracy, in a word, increases geometrically while resources multiply only arithmetically. Thomas Malthus introduced this idea two centuries ago to argue that human reproduction must outrun our food supply, resulting in ultimate starvation. Malthus was thus the author of all our worries about overpopulation, but to date at least, it would seem that he got things backwards. Reproduction seems to be a factor of production, that is, food supply, and not the other way around. And it is productivity that has increased geometrically while reproduction has increased arithmetically. There has in fact been an immense growth of population since Malthus’s time, with the result that something like oneninth of all the people that have ever lived are alive now. The best and most recent scholarship also indicates that we have more resources than ever before. This will be no surprise to those who know how we develop resources.
Nevertheless, the same theory applied to bureaucracy, and in particular the parasitic form, is not only true but horrifying. Simply stated, State agencies can consume faster than we can produce. Never in sixty centuries of State history can I find a single exception to this. Over and over we see the same cycle: a civilization that rises in relative freedom and growing productivity, and falls in State excesses and consumption. Over and over we see the productive mechanisms destroyed by parasitism; anything worth stealing, stolen. The bureaucratic system, misapplied, cannot support human life.
In other words, in the State system, bureaucracy multiplies geometrically while the resources needed to support it, from the productive economy, grow only arithmetically. Political action creates an ever increasing demand for bureaucratic intervention, which causes damage faster than society can repair it. Never knowing when to stop, the bureaucratic power continues to expand its interventions until society itself collapses.
The rise and fall of civilization is not everyone’s cup of tea, so let’s put it in contemporary terms. According to the conventional wisdom, we “collectively” identify some pressing social problem. This is certain to evoke cries for federal aid. Every interest group in the country is trained from birth to plead for federal funds, i.e., raid the treasury. Most, if not all, exist for no other purpose. All such pleas are at once amplified and echoed by likeminded interest groups, by academics, by reporters, by liberals or others who advocate government expansion, and most of all by the bureaucrats themselves, who stand to profit directly from an increase in their power. This chorus of interest groups therefore speaks for the new intervention in a loud and concentrated voice. It will recite all sorts of-reasons why we all should support this new intervention; they will say it is compassionate and just and generous and oh-so right.
But opposition to the measure is faint and diffused among two hundred million people. The opponents are not organized. There are no “interest groups” to oppose the measure. And anything anyone says against the measure will be made to sound heartless and pro-misery —what? ! Are you in favor of cheating the poor and the helpless? Most of us are too generous and anti-misery to speak up at all. Few realize that the dispute is not about whether we should aid the needy (which we can do better through private charity), but rather, whether this is an appropriate and just expansion of government power and taxation. By bringing up the false issue of compassion, the coalition of special interests has already won the debate.
Professional politicians, who know exactly what is going on, now “report” to the people that the people are overwhelmingly in favor of the intervention. Congress then passes legislation that will supposedly deal with the problem. A new bureau is set up and funded, and taxes are increased accordingly. People, if they think about it at all, are extremely prone to make two false assumptions at this point. First, they assume that the legislation is democratic and representative because “everybody” is for it. In fact, only the few who stand to profit from it were for it, and they engineered a swindle. Second, we may assume that the problem has now been “taken care of.” How anybody could believe this, given the unbroken record of bureaucratic disasters, I cannot imagine; but many do. It is faith almost child-like. The truth is, the problems have just begun. The intervention will create new problems and new demands for federal aid. It is this process that even now is taking us down the well-traveled road to absolutism and disaster.
We never seem to penetrate this swindle. It happens over and over. It should be fundamental to our understanding: The bureaucracy cannot solve problems. It hasn’t the tools to do so. It creates problems, and that is very much in its own interests. If bureaucrats actually solved the problems they are charged to, they would put themselves out of work, which is the gravest possible violation of the Bureaucratic Code. Bureaucrats never try to solve problems. Their business is to fund problems, or, occasionally, to license them for a fee.
In the process, we, the people, are ever so carefully coached and trained to ship every imaginable problem to the agency least equipped to deal with it—to the government. This has not always been so. In fact, the domestication of the free American—or if you prefer, the socialization—has only been achieved in the last few decades. Before that we were a fiercely independent bunch, too proud for the dole, and strong in our freedom. Now we are weak, eager for the tax-dollar benefits we think are a “right” even if somebody else earns them; and, hooked, we send more problems to Washington, D.C., where they cannot be solved.
The fact is, the government is in business to look after the government, and all the bureaus and agencies and offices it creates have but the one purpose of extending government power. Or if you want to put it crudely, they are there to buy votes, until the time that government domination is complete and votes are no longer needed. Consider this well, because in terms of governmental growth we are far along in the well-traveled road to decadence and annihilation. Not even America, for all its strength, can survive the ancient cycle. Either you and I get unhooked from our dependence on bureaucracy, or the soil of the earth will cover our proudest achievements, as it has in so many civilizations before ours.
To bring the point home, I am going to make you a bureau chief. I am going to present you with your own federal agency. You are a responsible person, so I know you will be determined to hold the line on spending, and to solve the social problem you’ve been assigned, even if it costs you your job. Yet, as if by primal instinct, your own bureau will create more of the difficulty it is supposed to deal with, and grow into a monster. And you can’t stop it. And if you can’t, what can we expect from a bureau chief whose only instincts are to follow the rules and enhance bureaucratic power, and never mind the problem?
This exercise, as I noted, is in the lighter vein, and you won’t find a single measurable fact to support it—except that bureaucracy does grow, with disastrous consequences. But I am not straying from the truth. Roche’s laws have been repeatedly confirmed by the (very) few people who have been through the bureaucratic mill and survived to tell the story. Life in the bureaucracy is terribly infectious, and not many come through unchanged. But if you know one who did, just ask.
* * *
Misery is discovered among the people! We go through the usual interest-group process, and Congress takes the usual legislative step, voting to create a new anti-misery agency. Let’s put the initial funding, conservatively, at one billion dollars a year. That’s not even one percent of the budget, not even close to it, a mere nothing—if, like Congress, you have no compunctions about spending the lifetime earnings of three or four thousand other people—three or four thousand productive lives—on this little project. After all, the government spends the earnings of around 60 million workers a year, and the lifetime earnings of two or three million—what’s a few thousand more? What do Congressmen know about earning a living, or anyway, how can they weigh the cost of spending thousands or millions of productive lives? You get your billion.
You are nominated as bureau chief and confirmed by the Senate. Your bureau will be called, appropriately, the Bureau to Abolish Misery (BAM), so that nobody will mistake your good purposes. You take the oath of office, swearing to uphold the Constitution, so help you God. Does it matter that you are sworn to abolish misery? Probably not. Does it matter that abolishing ~nisery is not among the specified powers of the Constitution, and thus must be considered unconstitutional? That’s between you and God. But you’re in the bureaucratic business now, so what matters a little oath to God? You are working for the government.
Your first step, of course, is to hire a staff. You will need assistant administrators, a comptroller, a large legal department—all bureaus have a large legal department, a technical department with statisticians, mathematicians, computer specialists and so on, policy advisors, a property officer, clerk-typists to do the work, and, naturally, professional misery fighters. You will also need office space for all these people, needless to say, and for many more, the need for whose services will soon be apparent.
Of course you can’t hire just anybody for these positions; you need highly qualified people. You will have to offer salaries—and this is required by law anyway —that are “competitive” with, which means higher than, those for “comparable” jobs in private business, of which there are none. So you offer attractive salaries for the right people. You also offer some fringe benefits that business cannot match, not least the federal exemptionfrom Social Security and its payroll taxes. (The feds are no fools. They know what kind of a deal you get from Social Security. That’s why they exempted themselves from it and set up their own, much more generous, pension plan.) Naturally you get the staff you want, but it does cost a bit.
Next you’ll need some reasonably comfortable offices in a suitable location, which are not easy to find in Washington, D.C. You also want ample parking space, which is impossible to find in the District. Congress and the senior bureaucrats have already staked out all the parking. In any case, you end up spending a little bit more of your budget than you intended, getting set up. No matter, now you are in business, and you still have the usual 10% of your budget left to do what you set out to do—fight misery. That’s still $100 million—not exactly small change in this world.
Unfortunately, nobody notices that BAM exists. You don’t have any miserable clients. You will have to make a splash and let them know you are in business. So you hire a crack publicity staff, putting another dent in your dwindling budget. You have them work up a glowing report about BAM getting set up, headlined “New Agency Expeditiously Abolishes Misery.” You send copies to Congress, other agencies, and the media, in that order.
In the ensuing publicity, a great many would-be miserable people learn about BAM. The law of supply and demand takes over. The law says: if you increase the dollar demand for a given commodity, the supply will rise to meet demand. What have you done by announcing your billion-dollar budget for abolishing misery? You have increased the dollar demand for misery by exactly one billion dollars. The market supply of misery must rise to meet this demand. This never fails. Soon there are long lines of wretched people in your offices, hat in hand. You hire more misery fighters to accommodate them.
But you’re already in trouble. After spending most of your budget to get set up, you don’t have nearly enough money left to abolish misery. Indeed, your funds are being exhausted at an alarming rate. There is too much misery chasing too few dollars. You order your staff to check applicants’misery qualifications rigorously. Many clients get shortchanged or left out in the cold, and this makes them more miserable than ever. Some of them write spirited letters to their Congressmen, pointing out how miserable they are and making all manner of unpleasant remarks about heartless government. In the meantime, you send an urgent request to Congress for any emergency appropriation. Congress, which has other things on its mind, such as how to spot FBI men in mufti, and which is all in favor of abolishing misery anyway, gets the message. It votes to double your budget.
BAM grows. Taxes nudge higher.
You are back in business. The new funds ease the problem temporarily, but the law of supply and demand continues to function flawlessly. More people find out about BAM from the media and apply for relief. The &iends and relatives of your BAM clients also prove to be very miserable, and they come around too. Soon the lines in your offices are longer than ever. You hire more misery clerks and send a report to Congress and the press on what a fine job BAM is doing abolishing misery.
The lines of miserable people keep getting longer. They almost seem to be coming out of the woodwork. Their very lives are changed by the misery payments. It’s not enough money, they complain to reporters. Their misery payment is barely enough to scrape by on, and that makes them miserable. This gets widely reported. You have your staff send out stiff letters to the press, out that you are doing the best job you can to abolish misery on a very tight budget. The stories continue. In the publicity, more miserable people find out about BAM and seek relief.
You will have to go back to Congress for more money. This time you are asked to testify before a House subcommittee, to explain the situation. You have your growing PR staff prepare the presentation. The congressmen are not unsympathetic. You explain that America is far more miserable than Congress had originally thought. You riffle through your flip chart, showing the facts and figures. The subcommittee reports favorably on your request.
Congress sizes this up carefully. It’s pretty plain that abolishing misery is politically popular. Mail has been heavy on that point. Constituents are begging to have their misery relieved. And the booming business at the Bureau to Abolish Misery wraps up the point. On the other hand, the pro-misery people are obviously weak and disorganized. No pro-misery lobby exists, few unfriendly editorials have appeared, and hostile mail is just the usual grousing from taxpayers who have to pay the bills. Congress votes a supplemental increase to BAM’s emergency appropriation, thoughtfully sending out notices on this vote to the press and to concerned constituents.
BAM grows. Taxes increase perceptibly.
Now so many wretched people are lining up in your offices that your staff falls farther and farther behind in the paperwork. Services get slower and slower. You hire more clerks and open new windows, but the jam-up keeps getting worse. A few conservative newspapers run editorials highly critical of the waste and inefficiency in BAM. One says it should be abolished. Several senators get on your case.
You hire some really top-notch PR people to rally support for BAM on the hill. Experience has taught you that to get ahead in your mission, you have to have clout. Clout means making a favorable impression in the right places, i.e., where the money is, i.e., in Congress. Your PR team works up a great presentation. You send them out to lobby in all the right places, carefully timing it to sway Congressional consideration of your regular annual appropriation. Your PR people are persuasive in arguing that BAM is abolishing misery as best it can on its puny $2.5 billion budget. They say misery is so pervasive, and BAM is doing such an important job, that your budget should be quadrupled. Congress ponders this, cuts your budget request with considerable fanfare, “to fight inflation,” and allows you triple your previous appropriahon, mcludmg supplemental emergency funding, which is exactly what you wanted. You don’t tell the press that you and two key senators worked out just this appropriations strategy over a fancy dinner in Georgetown.
BAM mushrooms. Taxes increase again.
Your competition in the private sector slowly withers. Private misery insurance becomes less and less profitable, and is finally dropped by all the big insurance companies. Donations to charities drop off sharply, so they have little money to relieve misery. You are approaching a monopoly in the misery relief field. All the people who used to turn to charity or buy misery insurance become BAM clients, and the lines of misery supplicants in your offices get longer and longer. This calls for another emergency supplemental appropriation, which the House passes quietly, in a voice vote, without dissent.
BAM grows. Taxes rise.
You outgrow your original offices, and rent a whole office building just outside the District for your headquarters staff. Moving the bureau will be a headache and will disrupt services to the miserable, but there’s no way to avoid it. You also set up nine regional offices at key points around the country, and these in turn set up satellite offices in most sizeable cities. This makes it much easier for miserable people to apply for relief. The wretched respond handsomely, lining up at BAM offices from coast to coast.
BAM grows. Taxes rise.
By now your personnel roster has become the third largest of any federal agency. Almost all of your people find their jobs extremely pleasant, their salaries adequate, their surroundings comfortable, and best of all, their jobs secure. They have none of those nagging worries about their jobs they used to have working in private business. Here you have made tremendous headway in your mission: misery is at least 95% abolished on your BAM staff. They become happily settled in, that is to say entrenched, that is to say, lifers. They themselves would become terribly miserable if they ever succeeded in the mission and abolished misery—they would be out of a job! But that is not possible. Monthly misery payments do not make anybody less miserable. And if they did, they would be prohibited by law! The regulations make it very clear that recipients must lead genuinely grim, miserable lives to get the payments. And so they do. Enforcing this “means test” creates a monumental paperwork problem, but how else can BAM—and Congress—be sure you are not making misery payments to people who are not really miserable? But questions like these need never concern you so long as the law of supply and demand remains in force. The more dollar demand you create for misery, the more misery the market will supply, and it will be the genuine article. BAM and its mission are utterly safe, as far into the future as one can see.
BAM grows. Taxes rise.
You personally, as an eleven-digit federal officer (going on twelve), become entitled to a chauffeurdriven government limousine. As a modest person you worry that it might look bad, but everybody says otherwise. They say it’s important for you to use the limo, so that you become a visible symbol of how crucial the job of abolishing misery has become to this great nation. And they are right. You take the limo.
BAM is having a banner year. Taxes rise.
Not everything is coming up roses, however. Quite the contrary. Rumors circulate that misery fraud is rampant in your agency. The sensationalist press charges that BAM is going to be investigated for “corruption.” A congressman from Iowa gets all over you and makes numerous speeches in and out of Congress calling for a complete housecleaning. In due course a congressional committee investigates. It finds that certain rotten apples in the BAM barrel have used their offices to take graft and kickbacks, and to put happy relatives on the misery rolls. Altogether there are 152 indictments, and several thousand other BAM employees sigh with relief when they are missed. It is a trying time, but your PR staff fights back with a promise to make a clean sweep, and by arguing that this sort of thing is inevitable because BAM is so pinched for funds in its great task. You ask for an emergency appropriation to hire auditors. With appropriate fanfare, you beef up your internal enforcement staff and launch your own investigation. You fire eleven people you never did like anyway, and announce that the problem has been solved.
BAM continues to grow despite its problems. Taxes rise.
As if one scandal weren’t enough, an audit reveals that 27% of your misery payments have been going to unqualified, cheerful people. This is little worse than average for federal programs, but it causes some stir. You hire more auditors, with fanfare. Congress tightens up eligibility rules, but softens the blow by increasing your appropriation. Your paperwork problems multiply, so you have to hire more people to handle it, including three of the eleven people you fired.
BAM grows. Taxes rise.
The law of supply and demand continues to function perfectly. Every time your appropriation increases, more miserable people apply for relief. The more clients you have, the higher the appropriations you have to seek from Congress every year. But Congress will comply when you demonstrate how many miserable people need help. And the following year even more miserable people will want relief.
BAM grows much larger. Tax rates are “adjusted.”
In a brainstorming session your PR people come up with a really sharp idea: Misery Stamps. You like it, and have them work out the details for a presentation. In a few months you appear before a congressional committee with your flip charts to make the case for Misery Stamps. Not only will Misery Stamps help abolish misery, you argue, it will cut down on paperwork in BAM. Congress likes it, and soon BAM is issuing billions of dollars worth of Misery Stamps to the miserable. One can spend them just like money and all the stores accept them. In fact, they are money.
BAM grows. Inflation rages.
About this time a hot young staffer in the legislative office points out that BAM is too big for one bureau. You are fighting the greatest social problem of our times. Business is booming. It is time for the amoeba to split. What you should do, the young man suggests, is specialize: set up seven new offices, directly under yours (here he shows you a new organization chart he has thoughtfully drawn up, with the seven offices in place). The new offices would handle specific kinds of misery. You should have special offices for the halt, the lame, the blind, the elderly, the minority surnames, the resentfully nonupwardly-mobile, and afternoon soap opera junkies. You can’t reach all this misery without these special offices, he argues. You like it, promote him on the spot, and reach for the phone to put it in motion.
BAM grows. Tax rates are “adjusted” another point.
Ideas dance. You brainstorm it with the same young man, now your personal assistant, and a few of your best PR people. You think of at leastfifty groups of wretched people who aren’t being reached now, but who could be reached through special BAM programs and offices. Your assistant points out that if you can feed a new of fice onstream every week or two, BAM should reach cabinet status in eighteen months at the outside. A serene, presidential-prospect smile crosses your face as you reach for the phone.
BAM swells. Taxes rise sharply.
The dream comes true, almost on schedule. BAM is awarded cabinet rank, and now becomes the U.S. Department to Abolish Misery—DAM! Along with the award comes a sharp increase in your appropriation, now well into twelve digits. You are confirmed as the first DAM secretary. Congratulations!
DAM mushrooms. Taxes mushroom. Inflation passes 30%.
With cabinet rank, DAM enjoys a startling change in the public and media attitude. People stand in awe. Reporters are extremely deferential. Publicity about DAM abounds. You personally are mentioned regularly in the news and gossip columns. You have arrived.
DAM continues to mushroom. Taxes rise. Inflation rages. The economy slips into a sharp recession, despite the blizzard of paper money and bank credit.
Now the Grand Effect takes over. Between DAM’s twelve-digit budget and similar efforts by your bureaucratic colleagues, the tax burden creates severe poverty all over the country. More and more marginal taxpayers are pushed into the destitute bracket. Now they become miserable and apply for relief. As the recession deepens, millions are thrown out of work and become desperate. They too qualify for misery relief. The process feeds on itself. The millions of newly miserable people getting relief increases the tax burden and inflation so sharply that even more taxpayers are forced to take relief. The number of productive taxpayers dwindles rapidly, while the misery rolls swell enormously. Government printing presses work night and day printing more money, but the economy crumbles. Millions more become unemployed and apply for misery relief. You go on national TV and promise relief for all. Business at DAM has never been better.
DAM grows. The economy collapses. Tax rates increase, but nobody can pay the taxes. Misery payments are financed entirely by fiat money, but the payments don’t buy anything.
At this point, practically everybody in the country is unutterably miserable, except, of course, the bureaucrats. The entire country is your client at DAM. Yours is the Cinderella story of world bureaucracy.
On this cheerful note, we take leave of our tale. It is time to go anyway; the Barbarians are at the gate.
* * *
My tale was playful. Its message is anything but. Every effort to eradicate “misery” through the taxing power of the central State is a contradiction in terms, and foredoomed.
The State has no resources to fight poverty or misery. It has no money to give the people that it has not first taken from the people. Much of what it takes, it keeps, to pay its own, enormous, bureaucratic expenses. It is a matter of mathematical certainty, therefore, that the people always get back far less than they contribute. Or put it this way: the process invariably leaves the people with more poverty and the government with less. This should persuade you, if nothing else has, that it is always in the State’s interest to make you poor and miserable. It’s the perfect way to keep their hands in your pockets.
* * *
Let us return now to the point I posed earlier, namely that in its deepest roots, the impulse toward bureaucratic growth is fueled by simple human greed. For this, we turn again to the insights of Albert Jay Nock in his classic 1935 essay, Our Enemy, the State. This work developed the earlier sociological research of Franz Oppenheimer, who had observed that throughout history, without exception, “Wherever opportunity offers, and man possesses the power, he prefers political to economic means for the preservation of his life.” Baldly stated, men would rather steal than earn a living if they have a way to do so easily.
From Herbert Spencer and Henry George, Nock had learned “the formula that man tends always to satisfy his needs and desires with the least possible exertion.”
These two basic principles of behavior come together in an almost blinding insight about the human condition. Nock recalled that it occurred at a luncheon with his friend Edward Epstean, to whom his book was dedicated. He described the incident in his autobiography:
“I do not recall what subject was under discussion at the moment; but whatever it was, it led to Mr. Epstean’s shaking a forefinger at me, and saying with great emphasis, “I tell you, if self-preservation is the first law of human conduct, exploitation is the second.”
The remark instantly touched off a tremendous flashlight in my mind. I saw the generalization which had been staring me in the face for years . . . If this formula (of Spencer and George) were sound, as unquestionably it is, then certainly exploitation would be an inescapable corollary, because the easiest way to satisfy one’s needs and desires is by exploitation . . . .
In an essay which I published some time ago (Our Enemy, the State), having occasion to refer to this formula, I gave it the name of Epstean’s law . . . . Man tends always to satisfy his needs and desires with the least possible exertion.”
Armed with this insight, Nock demolished all pretense that the State could ever become a benevolent institution or serve the interests of society. The State is the organization of the political means. Its sole purpose is the economic exploitation of one class by another. The State originated historically for purposes of exploitation, and exploitative it remains; it cannot change its nature. So swift and telling were his arguments that the whole battle was over in five pages. Washed away were all the attractions of centralism, all the romantic Marxist notions that the State, once it became total, would coincide with the interests of society and “wither away.”
Nock was careful to distinguish between “government,” essentially a negative or non-intervening form of organization whose only interests are justice and defense, and the State of the Old World, which is ever an exploiter. The Founding Fathers made the same distinction and made every effort to limit our own government to its rightful purposes. But the distinctions were chipped away over the years, and finally destroyed in the legislative carnival called the New Deal. Ever since we have had, in essence, a State of the Old World type. Ever since its exploitations have grown year after year, its appetite increasing with every bite. I believe that this is the whole political problem of our time.
The only “if” in Epstean’s law, the one observed by Oppenheimer, is: “Whenever opportunity offers, and man possesses the power,” he will turn to the political means: exploitation. Confiscation. Theft.
The underlying question is, what is the easiest way for us to satisfy our needs? In a state of pure or relative freedom, the economic means is clearly the easiest. Stealing is too much work and much too risky. If you arm yourself to steal, people will arm themselves to defend themselves and their property. If you organize a whole band of thieves, the defenders will organize a militia. And they will show you no kindness if you are caught, as inevitably you will be. Under “government” as Nock and the Founding Fathers conceived it, the economic means remains clearly superior. In other words, under freedom, Epstean’s law dictates that men will earn their living instead of turning to theft; it is simply easier. Honesty becomes more fruitful than greed, and men prosper.
What changed the equation was successful conquest by the nomad marauders, and the genesis of the State. It is the State, and nothing else, that makes it easier to steal than earn. The State is a license to steal. Physical fear of the conqueror turns into psychological dependence; the State is accepted as the supreme power, a god, a protector and dispenser of justice. Its agents assume the aura of a priestly class, in the vestments of authority; and its exactions become irresistible. No longer can subjects question the right of the State to take what it will, for their minds are enslaved along with their bodies. The State is god. The honest dealings of men give way to greed, and greed to glory. The masses are forced not to bake bread but to build pyramids. Such is the nature of things.
With the introduction of a true State in America, the workings of Epstean’s law dictated that men would go to Washington, D.C., for the ancient rituals. Men who do not respect the property of others. Men who have not the moral rigor to avoid the easy way. Uncivilized, greedy men: heirs of the ancient nomads. It is their greed that builds the American superstate and praises its glory.
Only now, fifty years after it began, do we see the first glimmer that other men, men of principle, men who do not choose the easy way, can go to Washington with popular support and try to restore the American concept. But so far it is only a glimmer, and terribly hard for those who act on our behalf. The best thing we can do for them, and for ourselves, is to understand. Our enemy is greedy, and his every appeal addresses the greed within ourselves. If we know this and resist, we give him no refuge; only then will his swindles fail.