Explaining Government Failure

January 26, 2008


“One of the great mistakes is to judge policies and programs by their intentions rather than their results.”
-Milton Friedman

Whatever their political views, everyone, from libertarians to strong supporters of the welfare state, agrees that government actions can have negative consequences. Where libertarians and statists disagree is the explanation for why this is the case. Whereas libertarians tend to attribute these negative consequences to fundamental defects with government, more left-leaning people tend to say that behind most government failures one finds bad motives.

Start up a conversation about the Iraq War with a Democratic party supporter, and I guarantee it won’t be long before you are hearing that “Bush lied” or “We only went in there for the oil.” Whatever the debate, there is this picture of President Bush that portrays everything he has done as badly motivated. Iraq went badly because Bush was only in it to get the oil. New Orleans proved a disaster because “George Bush doesn’t care about black people.” Everywhere Bush’s policies are examined, Democrats see his secret motives, and these motives are evil.

It’s not just Bush. Reagan gets the same treatment. A few months ago, New York Times columnist Paul Krugman wrote a series of articles arguing that Reagan was a racist. This implies a whole new way of seeing his policies; he was motivated not by any principled vision of government, but rather by his hatred for black people and the poor.

As anyone who has taken an Introduction to Psychology course can tell you, everybody wants to have consistent beliefs. People who hold two contradictory beliefs experience cognitive dissonance and have to alter one of them to make their view consistent. If you believe that government can be a force for good and solve major problems in society, you have to reconcile this belief with the obvious fact that examples of government failure are abundant. The question, then, is how government, which is supposed to have a positive effect on society, is responsible for creating so many problems and for making so many others worse.

The solution is found by dividing politicians into the “good”and “evil” kind, based largely on the consequences of their policies. The claim becomes: Government action can help the poor, but when it doesn’t, that is because the politician in charge is an evil person. So there are good programs and bad programs. The good programs are motivated by a desire to help people who are poor or suffer discrimination. Bad programs are motived by greed, thirst for power, and a desire to help rich corporations.

For a libertarian, on the other hand, motives really don’t matter. Government can’t fix problems, full stop. A fundamental tenet of libertarianism is this: only a fully free-market system offers proper incentives on all actions; government action alters these incentives, and that always has bad consequences.

I don’t believe that Reagan and Bush are evil, but there’s more to it than that. My beliefs aren’t just a simple reversal of Democratic beliefs, so Bush good, Clinton bad, Reagan good, FDR bad. My intuition is that all of these presidents basically had good intentions. The fact that I believe this doesn’t make me a better person than my Democratic-leaning friends by some argument like “Well, I always try to see the good in people whereas they are cynical,” or anything like that. I just believe that the people who think that government can be a force for good, Clinton and FDR among them, are wrong.

It’s relatively easy and not at all psychologically painful for me to admit that Clinton and FDR had good intentions, because I don’t attribute the failure of government policy to the intentions of the President. Politically, the solution for Democrats always seems to be to say, let’s get rid of the old corrupt leaders and get some good people in there, people who really care about the poor and the problems average Americans face. It hurts a lot more for Democrats to say that the people we have in government already are good people, whose honest, good-faith attempts to make things better for America are a failure.


3 Responses to “Explaining Government Failure”

  1. Thomas Says:

    I hereby admit, on behalf of myself and my left-leaning friends, that we Democrat types believe that we know who is good and who is evil. We know that Bush and Raegan were bad people, and that’s why we dislike them. Everything, for us, is black and white.

    Phew! There’s a load off my chest.

    Let’s look at your statement: “Government can’t fix problems, full stop.”

    Firstly, I admire your British use of the words “full stop” instead of “period.” Classy. Secondly, what about the government’s role in leveling externalities by levying taxes? For example, you yourself said that the most effective way to slow climate change down would be to levy a carbon tax. The free market can’t do that for you, can it?


  2. hayley Says:

    ¨behind most government failures one finds bad motives¨
    Disagree, full stop

    “Government can’t fix problems, full stop.”
    Disagree, full stop

    But I´m not going to harass you, you use sound reasoning and impressive insight.

  3. […] instead of abandoning government altogether, perhaps it’s worth recognizing that there is a set of policies out there that could […]

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