Column Draft: Rove, Schmove

Forget that sell-out, Karl Rove: He plainly understood the need to pay lip-service to small government to keep certain voters happy. Besides, he didn't single-handedly usher in a new era of big government, anyway.

More interesting than Karl Rove or anything he did is how a party supported by so many small-government voters played such a big role in resurrecting big government. This happened within a dozen years of Bill Clinton pronouncing big government "over" -- and during a time when it seems that some "market-based" or "libertarian" proposal vies for attention in every public policy debate!

To begin to understand, it is worth recalling an observation Ayn Rand alluded to in the title to her book, Capitalism: The Unknown Ideal. Namely, too many people do not know what, exactly, capitalism is.

Bearing this in mind, let's look more closely at a few recent "small-government" proposals.

Take a new trend of "privatization" of government-owned infrastructure recently examined in depth by a prestigious conservative public policy journal.

Indiana, in a typical example, "privatized", its turnpike after learning that it was spending 34 cents for every 10 cents it collected in tolls. Only Indiana didn't really sell the turnpike – just the operating rights. And only for 75 years. And the buyer will get to "operate" it only in the sense that a marionette "operates".

Says Matt Will of the University of Indianapolis, "The agreement for the Indiana tollway lease is far more detailed than anything InDOT [the Indiana Department of Transportation] had to live up to when it was operating the road."

Even taking the protracted lease as a sale, this would not be a move towards capitalism, but from socialism (government ownership of the means of production) to fascism (private ownership with government control of the means of production).

It is noteworthy that all of these proposals have increased state revenue -- rather than better protection of individual rights -- as their goal.

And if "privatization" isn't reducing state interference with the economy, there are plenty of other "market-based" proposals out there to expand it! One such proposal, signed into law by California's Republican governor last year, imposes a cap on carbon emissions. As a sop to businessmen, it also creates a "market" in "carbon credits".

Since when has a communal fuel ration for an entire economy been a part of capitalism? Arnold Schwartzenegger never bothered to explain.

With "market-based" proposals like these, what could be worse? Try on "libertarian paternalism" for size. Advocates of libertarian paternalism hold that since people tend to make "mistaken" decisions in certain areas, the government should "nudge" them in the right direction.

For example, one proposal is that, as in Europe, we all become organ donors by default to increase the supply of organs available for transplant. Unfortunately, this increased supply comes without the consent of the new "donors" and with the risk of a premature harvest of one's organs after an accident! Forget property rights for a moment: What about the right of each individual to his own life? Isn't protecting that what government is for?

Plainly, far too many of those who profess to be in favor of free markets are lying or do not know what they are talking about. And they continue to get away with it because too few people know the actual meaning of the term "capitalism", including some who think they are advocating it.

Capitalism: The Unknown Ideal remains a must-read forty years later. For starters, consider the following definition: "Capitalism is a social system based on the recognition of individual rights, including property rights, in which all property is privately owned."

Mere confusion about the meaning of the word "capitalism" is certainly not the whole story. Nonetheless, if we advocates of capitalism do not keep this definition in mind, we will continue to accept bad news as good and fail to respond accordingly.

-- CAV