Would you be opposed to the government participating in the capitalist system?

1. 56

   Woodpecker27posted 11 years ago

   Would you be opposed to the government participating in the capitalist system?
   
   Would you be opposed to the government owning and operating businesses that did not control the whole market, but helped provide jobs and additional money to assist with the removal of our deficit?

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2. 66

   LandmarkWealthposted 11 years ago

   Yes.  the role of gov't is to regulate markets and facilitate a level playing field, not to participate in them.  Here is why...
   
   Imagine you open a lemonade stand.  And across the street the gov't opens one as well to compete with you.  Some would assume that the competition is a good thing because that's what makes a free market work.   The problem is that you will price the sale of lemonade based on numerous factors.  One paramount factor is the overhead you incur.  What it costs you to operate the lemonade stand.  Since you have a finite amount of capital to invest in the lemonade stand you must consider all of these variables in setting prices.    On the other hand, the gov't has no overhead.  That is because gov't is funded by the tax revenue generated from private activity such as your lemonade stand.  So every dollar that the gov't spends on the overhead to operate this lemonade stand is paid for by you.   You ultimately must pay for your own costs, as well as the costs of your competitor.   
   
   This is inherently why gov't is inefficient.  The costs you incur affect you greatly.  You as a business owner must carefully evaluate how you spend each dollar you raise.  However the gov't doesn't spend money carefully because they can simply tax you more when they need more.  They can operate with no real overhead, and still drop prices below where you can afford to sell your lemonade.  It won't matter if the gov't turns a profit.  That's not what they do. When they need more money....they'll take it from you.  Eventually you won't be able to compete with a competitor who can lower prices below what you can afford to charge while you pay for their costs.  Once you're out of business, the the gov't will be the only one selling lemonade on your corner and brag about what how bad the private participants in the industry were.  In the meantime they'll tell the public how fortunate they are that the gov't is here to sell lemonade because the private sector couldn't handle it. And without gov't...we'd all be dying of thirst.  And they'll be even less incentive to serve it well, because they'll have no competition anymore.
   
   This is how numerous industries have been destroyed by the gov't crowding out private investment and eventually destroying the quality of the product sold or delivery of the service rendered.

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   1. 56

      Woodpecker27posted 11 years agoin reply to this

      But what if the government was prevented from overcrowding the industry and could only control say 5% of the total business for that service or product?  hypothetically speaking...

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   2. 66

      LandmarkWealthposted 11 years agoin reply to this

      It wouldn't work because it doesn't change the dynamic of you still paying for your competitor.  Plus who regulates the gov't ???  Another Gov't ???

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3. 70

   stanwshuraposted 11 years ago

   The liberal in me shouts "let them play, too".  But the even more liberal me says it would be a conflict of interest, because they/it should be *regulating* the market(s)!

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4. 80

   Mitch Alanposted 11 years ago

   Flat out NO. The government is already in bed with business. It's called corporatism and it is detrimental to the free market as it allows the government to pick and choose winners and losers. It causes an unfair playing field rather than a fair one. The government, especially on  the federal level, has no right to be involved in business except in very limited regulations that are, for the federal government, enumerated in the Constitution. Allow free markets to be actually free and you see more prosperity, not less.

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