Government Role in Economics

Government Role in Economics

       From a friend of mine who wrote this as part of a college class he is taking.

               Since the inception of government, many have debated what its proper role and size in society is. Lockean liberals believed in laissez faire economics while T.H. Green, who many consider to be the father of social liberalism, believed that the government had a role in helping the poor. When the government takes on the complete role of the economy, it is called collective decision-making. Collective decision-making is, “the method of organization that relies on the public-sector decision-making (voting, political bargaining, lobbying, and so on) to resolve basic economic questions.” (Gwartney p. 35) Under this economic theory, the government owns and controls the means of production, leaving no room for complete property rights of the individual. Marxism-Leninism is a prime example of complete government ownership to the extreme level of a dictatorship.

            In The State by Franz Oppenheimer he tackles the idea of a strong central authority in the monetary system, “Here, as in the case of the maritime States, the consequences of the invading money system is that the central government becomes almost omnipotent, while the local powers are reduced to complete impotence.” (Oppenheimer p. 109) As we can see, Oppenheimer did not believe in a strong central government at the federal level invading the economics of a nation. Many problems can come from the government insisting its role in the economy of a nation. Centralized planning can take on the façade of a wonderful thing and help many at the beginning of its quest, but slowly the market will catch up and expose the miscalculations and imperfections of man.

            When we truthfully analyze an economy one must admit that market anarchism does not exist, and never has. All economies are mixed to a degree. Even an economy that is completely collective will have black markets on the side that take the place of the free market, though this would not be enough to change a dictatorship over an economy. In modern times, we see the example of socialism as collectivism in action. Though there are many different definitions of socialism, the one that has become most prominent is that of state socialism. The horrors of state communism under Lenin and Stalin can be attributed to state socialism along with Marx’s idea of “dictatorship of the proletariat.”

            How can the Christian find a balance between government control and the failures that capitalism has when concerning ones spirituality and emotional needs? I think that we must look at Romans 13 to help us understand authority, “Consequently, whoever rebels against the authority is rebelling against what God has instituted, and those who do so will bring judgment on themselves.” (Romans 13:2, NIV) Whenever we understand that God has ultimate control of this world, we will understand that it is His authority that comes first but that the men and women He places at the level of authority is His doing; thus, He is always in control.

 

Gwartney, J., Stroup, R., Sobel, R., Macpherson, D. (2013). 14 Edition. Economics:             Private and Public Choice. Mason, OH. South-Western, Cengage Learning

 

Oppenheimer, F. (1908). The State. San Francisco, CA. Fox & Wilkes