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A Defense of (Some) Big Government

Updated on October 26, 2011

Is All Government Spending Bad?

I am going to (eventually) start this article with a statement that will make me sound like a typical liberal, socialist, hippy, bleeding heart, class warrior who wishes that he was currently occupying Wall Street. But don’t worry. I recognize that the federal government at some point needs to figure out how to make significant cuts in spending, specifically with Medicare, Social Security, and defense. I also recognize that government, by its nature, often does things less efficiently than much of the private sector.

But here it goes: there is more to life than turning a profit. For all of its inherent weaknesses, government, particularly at the federal level, can accomplish something that the private sector is generally unable to do. The federal government has the capacity to amass an enormous amount of resources to perform vitally important projects that, in addition to being extremely expensive, may not generate profits, at least in the short term. And in many cases, the federal government will experience financial losses that a private company could never withstand. But without massive investment by the United States federal government in the past, we would live in a fundamentally different – and in many ways much worse - nation today.

For example, The United States invested heavily into its space programs from the 1950’s through the 1970’s. To many people at the time, this may have seemed wasteful, and it definitely had no short-term profit potential. This was largely an attempt to keep up with and ultimately defeat the Soviet Union in an international propaganda war. In practical terms, after all, what did going to the moon actually do for our nation? Primarily, it gave us a chance to stick our American flag up there first with the entire world watching. But when you look at the long-term benefits of the process of sending men and satellites into space, you realize what a fantastic investment that this was. The satellite, rocket, communication, and computer technologies that were spurred on partially by these efforts have completely transformed the world in ways that most people at the time could hardly imagine.

Over the decades, you can find several other cases of the government engaged in efforts that could hardly be seen as financially efficient when they were carried out. Massive defense spending during World War II and the Cold War may have generated large profits for defense contractors, but this also saddled the federal government with debt. The country did, however, achieve victories over fascists and communists, and investment into military technologies led to all sorts of consumer spinoffs that we benefit from today. And in addition to massive investments into security and outer space over the decades, the federal government constructed the interstate highway system, was the biggest customer for early computers, invested into scientific research, bailed out the imploded financial sector, and established national parks and forests (among other things). In the short-term, these actions had little financial benefit, generally constituting a net loss. But over time, some of these actions paid off with long-term technological innovation and economic growth. And whenever a person gets to enjoy the wonders of the Grand Canyon, Yosemite, or Yellowstone, he or she hopefully realizes that there is more to life than turning a profit. Not everything of value, after all, can be easily measured in monetary terms. How, after all, do you measure the monetary value of police and fire departments, access to education, and a (somewhat) cleaner environment?

So as our government hopefully embarks on the steps necessary to get its financial house in order, I hope that they do not throw the proverbial baby out with the bath water. There are definitely some programs that are wasteful and/or not financially viable in their current forms. But some forms of investment may be vital to the long-term success of our country, just as they have been at times in the past. All government spending is not created equal. But when people do not recognize this simple fact, seeing government spending in principle as something that must be cut, then projects that require both a large investment and a willingness to accept financial losses will not be undertaken. There are certain things that the private sector is simply unwilling or unable to do. And if everything becomes privatized, value will become increasingly defined in purely financial terms, with a focus primarily on the short-term. In a country that already leans toward short-sighted, individualistic, materialistic thinking, the abandonment of the concept of public investment could be disastrous. I suspect, unfortunately, that people who want to gut the federal government as a matter of principle are winning the political battle at the moment. And if they get their wish, it will be interesting to see if they are happy with the long-term results.


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    • sojourner1949 profile image

      Juan C. De los Santos 5 years ago from California,U.S.A.

      You're absolutely right Freeway Flyer.I also disagree with "welfare" being the bulk of government stimulus. Free money though is the best way to win the polls.

      Instead I'd prefer the government to encourage private businesses through sound monetary and fiscal policies,as well as entrepreneurial development, to open or expand investments deemed profitable on their own, and not to save or bailout industries that have been mismanaged and consequently unable to maintain profitability in the competitive world of free enterprise. After all, job creation emanates from both efficient private businesses and well thought of government enterprises.

    • Freeway Flyer profile image

      Paul Swendson 5 years ago

      To me, it not a question of whether to spend or not to spend. It's an issue of how wisely you spend. And yes, the here and now matters, but the wisest investments can often take years to pay off. Giving handouts, however, can often be more politically beneficial than investments in the future. So with the exception of defense spending, much of what the government does is, for lack of a better term, welfare. This meets social needs and can stimulate demand, but it can crowd out more potentially productive investment.

    • sojourner1949 profile image

      Juan C. De los Santos 5 years ago from California,U.S.A.

      There's no doubt about the need for government spending on areas like public utilities, national security, peace and order, conservation of natural resources, and technological advancement, more than private investment. And you're right, most of these are not easily profitable in dollar terms and in the short run, but they are essentials to growth.

      However, government efficiency is measured by how well it balances expenditures and revenue. Incurring a lot of losses on non-profitable ventures may lead to government bankruptcy, especially revenue in government budgets are just expected or planned. When it falls short, it resorts to borrowing. Since its ventures are not immediately profitable, is it safe to think that payments will be up to the future generation as well? And probably the future governments to balance the budgets?

      To my mind, there is nothing wrong with thinking about the future, but we shouldn't lose track of the urgency of now. What the people want to hear in this period of crisis is how does government expenditure directly affect their present well-being so that they can expect economic recovery.

    • profile image

      Howard Schneider 5 years ago from Parsippany, New Jersey

      I totally agree with you, Freeway Flyer. Completely shutting down needed investment in our country is ridiculous and dangerous. Our roads are crumbling and our energy system will soon be obsolete. I believe our government's role is to invest in these areas that will allow our country to grow in the future. Private industry will not do it.

    • christopheranton profile image

      Christopher Antony Meade 6 years ago from Gillingham Kent. United Kingdom

      A very wise article, that should give a lot of voters pause before the next election.

    • Freeway Flyer profile image

      Paul Swendson 6 years ago

      Yes, there are some things that need to be done that are not profitable. A lot of people in my country have not figured that out.

    • CMHypno profile image

      CMHypno 6 years ago from Other Side of the Sun

      There are some vital services that really make sense to centralise and have run by government. Over here in the UK we all used to moan about British Rail, but privatisation has brought in expesnive fares, confusing ticketing and the suspension of many rural routes that were seen as unprofitable. While they might not have made money, kids depended on them to get to school, adults to get to work and older people to go shopping and access services such as doctors. We now have many villages where the train and bus routes have been cut where elderly people and those who don't drive can't even do their shopping.

    • quatrain profile image

      quatrain 6 years ago

      I agree somewhat with you and somewhat with dashingclaire. Today government has aqcuired an arrogance in dealing with citizens which rubs everybody the wrong way. Plus, there just are too many programs like Medicaid which attract non-citizens, some of them illegal aliens, which simply can't be sustained any longer. Sad to see it arrive at this point but we just have to trim illegal aliens from the rolls of many Federal programs. It's otherwise just not fair to those of us who as taxpayers are required to pay for them.

    • Freeway Flyer profile image

      Paul Swendson 6 years ago

      "Consent" is a tricky word. I was born into a complex system that came into existence long before I was around. Because I am busy with the day-to-day matters of life and am merely one of 300 million living under the system, I have a limited capacity to be truly informed and to have a significant impact. There is so much that people in power are doing of which I am unaware, and it is extremely difficult to determine the impact of these policies anyway. So am I giving consent to the people who force me to hand over tax dollars and spend them in ways that I may often dislike? I am mostly surrendering to the inevitable, and doing my best to choose the lesser evil of the limited leadership options. The costs of doing much more than this seem to outweigh the benefits. This sense of powerless, therefore, may have as much to do with the poor quality of the American electorate as our tendency to be self-centered and ignorant.

    • dashingclaire profile image

      dashingclaire 6 years ago from United States

      The quote is “No man is good enough to govern another man without that other's consent.” ~Abraham Lincoln.” “The government” is not an independent entity that is free-standing and isolated. It’s composed of people who were elected by the people of the US. The government is staffed by people who are managed/supervised by people, and who hire and fire people, but don’t always train and mentor people. “The government” does depend on people of the US to get out to voting, making intelligent informed decisions when deciding who is elected to be your voice in government, and you know what laws and regulations to support or not. It might be more worthwhile if we stopped shaking our heads at “the government” and started shaking ourselves. “Democracy: The state of affairs in which you consent to having your pocket picked, and elect the best man to do it.” ~Benjamin Lichtenberg True or not?

    • profile image

      Howard Schneider 6 years ago from Parsippany, New Jersey

      Very well said Freeway Flyer. Government is not the answer to everything but the Right's demonization of it is far overboard. Government must regulate the excesses of business' profit motives. They must provide the social safety net for those left behind in the economy. Relying on the free market for services such as schools, police, fire and many others would be disastrous. We need government to lead this country on a road to growth by rebuilding our infrastructure and investing in future industries.