Over the past two weeks, our media have done nothing but talk about the coalition, the government, and the budget. Generally speaking, this is normal — there is a new power in the country, a new team is being formed, and this is certainly top news. The reason for this note is not the news itself and the abundance of comments, but rather the substance of these conversations. It seemed to me that the main message was roughly this: “thank God we have them.” As if, setting aside the specific faces, the mere fact that there is a government — and that it was formed surprisingly quickly — is very good. Perhaps something will work out for them, and maybe even “we will have a budget.”
Again, I would not mind if the conversations were limited to this, if much more important and significant problems did not exist connected to this topic. If they were resolved, then cheerfully debating the cleverness shown in forming the government would be quite appropriate.
To illustrate these problems, let me give a simple example. Let’s say you will pay me money and I will provide you with services. I will buy groceries for you, treat you, teach your children. Only one condition — I myself will decide what purposes and exactly how I will spend your money: what groceries I will buy, who will treat you, what and how. This is, again, for your own convenience. After all, there are objective needs for food, nutrition, and shelter. These very needs I will satisfy. And I will also take care of your safety, health, and everything else that occurs to me — for example, your morals. It is clear that I will only be able to work by spreading your money in a thin layer across your boundless objective needs. Therefore, you will not go on vacation to the Canary Islands or even to Turkey, but to a rest home in Kryzhopol. When something hurts you, we will provide you not with what you need, but with what we can manage. I will even do renovations in your apartment. How do you like this green oil-based paint on the walls? It remained from army stocks from the USSR era. Don’t like it? Understand — your money is not enough for all your needs.
Filling our — I mean my — budget will be very difficult. After all, you are not conscious citizens. You will hide your — I mean my — money from me, secretly save up for Turkey, and at night scrape the green paint off the walls. But at the same time, you will nod your head in agreement when I tell you on TV about the difficulties of filling our budget and how hard it is, for your own good, to take your penny from you. Soon I will have competitors. They will tell on the same TV what a scoundrel I am and how poorly I handle taking money from you. They will say that if you replace me with them, they will take money better, more, and longer. They will even promise you free coffee on Fridays. You will happily agree, we will hold elections, and they will win. Of course, they will get nowhere, so the next elections will be mine. Before long, other aspiring participants will join the process, and we will have a dramatic, eventful life full of experiences. Your children will consider this situation acceptable, and your grandchildren — self-evident. They will even be proud that they live in a free country, because they can choose those who take money from them.
I will be told that this example is clear and obvious, and that everyone knows all this. Let me disappoint you. They do not know and do not understand. And do you know why? Because in this whole story, everyone is worried about whether I stole and, if I stole, how much. Did I steal, didn’t I steal… but what about that green oil-based paint on the wall?
Another objection will be that the government not only imposes harmful monopoly services. It also establishes useful norms and rules. This is also untrue. Behind the majority of norms and rules, you will find those same “services” either directly or in the form of “the common good” represented by the budget. An example of rules that are truly necessary could be traffic rules. They don’t care where drivers are going and what is on their minds. The overwhelming majority of our norms and rules are not like that. Green “Zhigulis” are allowed to go on red. Red-haired drivers must always turn left. Red “Porsche” owners cross intersections last because they are bourgeois and they’re already doing fine. Our “rules” regulate not relationships between us, but us ourselves. For our good and with our money.
But here we have digressed a little from the topic. When talking about government, we must, first of all, understand what exactly we mean. What is it? What is its task? What resources does it have?
The Cabinet of Ministers is only an insignificant part of what we do not know about the government. The Cabinet is not even the tip of the iceberg, but rather the periscope of a submarine. The main thing — the countless army of bureaucrats — is hidden from view. How everything works inside is known by very few people. How everything actually works is known by even fewer. At the same time, we must understand that the government is, in fact, 90% of the state. Whatever the president invents and whatever the deputies pass — all of this will remain plans until the government executes it.
Who sets tasks for the government? The government itself. Theoretically, it is believed that it receives tasks from elections. The voter votes for those tasks — the program — that seem most appropriate to them. Let us not delve into the details, of which there are many, but let us think at least about this. In parliamentary elections, we effectively vote for the government. Then we vote for it again in presidential elections (technically this is not the case, but de facto — it is). The question is — when exactly do we set its tasks? The next question — who sets tasks for the government if it comes into power between elections? Even these simple, obvious circumstances lead to our influence on what the Cabinet will do being practically reduced to zero. Confusion leads to irresponsibility. Yanukovych, for example, promised us tax holidays for small business. I wonder if Azarov knows about this and what he thinks about it?
It is astonishing how diligently our society strives to remain blind. For instance, Rybachuk claims that since he hires the president for work, he wants to hear from him “where we are going.” Correct me if I am wrong, but it seems to me that when hiring someone for work, such questions are not asked. The employer usually already knows the answer in advance. If the question “where we are going” arises at elections, this means there are no elections. And here one needs to ask completely different questions.
Moving on. Let us assume even that we have some opportunity to “order the music” at elections. However, can the government change its intentions after them? As much as it wants. Yes, such a government may lose at the next elections. But I cannot think of examples where a party won the next elections that would have done something to prevent the government from arbitrarily changing its intentions.
And finally, the third question — about resources. It also falls into the category of “we understand all this,” meaning we understand nothing. Let me remind you that the government creates nothing. It only redistributes. Its resources are our resources. When they say “at government expense” — they are lying. One should say — at your (or our) expense. Even in those cases when the government borrows or prints money — it is still at our expense.
The fact that most of our citizens do not personally pay taxes changes nothing. They do not feel that they constantly pay the government, just as a pickpocket’s victim does not feel the loss of money. Simply, some of us are paid for by our enterprises (paying us less), and the rest are paid for by those who pay the bureaucrat so as not to pay the state. We are all participants in the scheme, even the most shadowy and covert ones.
I want to be correctly understood. This is not about my being sorry about money for taxes. This is about why the government manages this money at all. These expenditures do not bring benefit. After all, there is no such thing as “education” or “healthcare.” In public life, there are no abstractions. This is not mathematics, and not even physics. The illusion of abstractions is created by bureaucratic reporting — the number of “vacationers,” “travelers,” “marrying couples,” and “ticket holders,” which they always happily report to us. In reality, however, there are my and your subjective needs: to treat a specific ailment, to go to Turkey, to paint the walls some other color.
One very important thing here is this. When I say that we are all participants in a scheme, I also mean that there is no difference between the bureaucrat’s pocket and the government’s pocket. The bureaucrat, like the government, also does not sit on the money he receives; he “invests” it, buying things for his home. However, for the consequences that befall society, there is no difference between taxes and bribes.
When I pay for something, I spend money that I received in exchange for goods and services that I produced, and someone bought them. They were needed by someone, I brought that person benefit, and through the money he paid me, I exchange this benefit for benefit for myself. As a result, a market is formed, or, as they like to say here — order, where “everyone gets what they deserve.” Someone goes to Turkey, and someone — to Kryzhopol.
When a bureaucrat buys sausage with my bribe, he does not exchange any benefit. He only receives, giving nothing in return. Exactly the same social effect is produced by government spending, thieving pickpockets, and counterfeiters. Together they all destroy national wealth.
The results of this diligent activity we have been observing for 20 years now. Very little benefit has remained in our society. This is the very “mess” that everyone dislikes so much.
I will be told that our government simply copies some “commonly accepted” functions. I am afraid that commonly accepted functions do not exist. In North Korea, for example, if you stay as a guest overnight, you must register with the local official. Does this seem abnormal to you? But why? Who knows what could happen! A war might start and you’re not at home.
Or take something so sacrosanct for statists as defense. Here is Switzerland, which is essentially entirely an army. By the way, here is the reason for Swiss neutrality. Such an army simply cannot attack anyone.
Perhaps there is something that deserves to sacrifice part of society’s wealth for it? Such a “something” probably could exist. However, let us note that no one is asking about this. The absence of answers, or rather, the absence of questions is the root cause of our many years of prosperity.
Therefore, it seems to me that when talking about government, one should not begin with how they work there and whether they work well. The first question should be why they work there.