In Objectivist society the function of government should be limited to the protection of people’s rights. The proper government functions therefore include only police, military and courts. But what would happen if government wants to engage in some other activities-like building hospitals or running insurance companies and people willingly finance such activities? Would it be still improper activity in spite of its voluntary character?
There’s been a earlier thread that asked the exact same question, if you want to try searching.
Anyhow, to answer your question: yes, it would be improper for government to do anything other than protect individual rights.
If people want to form a mutual aid society, nothing stops them from doing so. They can even form the “National General Purpose Mutual Aid Society”.
In Objectivist society the function of government should be limited to the protection of people’s rights. The proper government functions therefore include only police, military and courts. But what would happen if government wants to engage in some other activities-like building hospitals or running insurance companies and people willingly finance such activities? Would it be still improper activity in spite of its voluntary character?
As concisely as it has ever been put, I think : " A private individual may do anything except that which is legally FORBIDDEN;
a government official may do nothing except that which is legally PERMITTED." [AR, The Nature of Government.]
Although voluntary, such schemes would be trespassing on the private sector, and in competition with it.
Essentially, it is not, ever, for the government to get ‘creative’, the way I see it.
One can also address the question by asking what exactly it would mean for these voluntary activities to be part of government. In what concrete way would such a government organization be different from a non-government organization of the same kind? What would be the nature of such organizations? What elements of this nature would not exist if they were non-government? if there are no such elements, then one must question why we’re calling a non-government organization a government organization. if there are such elements, then we must ask why these organizations are to be endowed with these special elements.
Well, I didn’t mean that government will stop fulfill its legitimate functions and start to run hospitals instead. And what is wrong with the competition with the private sector, as long as government doesn’t initiate force against it? The truth is that this part of government would be indistinguishable from the non-government organizations, but the profit from the commercial part could finance the non-commercial legitimate part of government. The people who contributed money for the government will become shareholders and also could make good income. Finally, if government enterprises will be as inefficient as they are today, they will fall as any other bad business. But if they not-it could resolve the problem of voluntary government financing.
You ask “What would happen if gov’t wants to engage in some other activities?”, as if gov’t had motive and volition of its own apart from what the citizens instruct it to do. In an Objectivist society, I’d argue that no citizen would petition the gov’t to perform any activity outside of its proper functions. In such a society, appealing to the gov’t – the sole posessor of a monopoly on the use of force – to perform any activity that can be handled freely and voluntarily without the introduction of agents of force (whether their weapons are holstered or not), would be recognized as an affront to free-market capitalism and roundly rejected.
The truth is that this part of government would be indistinguishable from the non-government organizations, but the profit from the commercial part could finance the non-commercial legitimate part of government.
It does not really address the issue of initial voluntary financing, because the financing to buy the stocks/bonds/ (or assets if the government manages the firm too) still must come from voluntary donations. It does address ongoing voluntary funding.
Why would it be a good thing to do away with ongoing voluntary funding? Below are two types of answers I can think of. Are there others you’re thinking of?
- A government does need some short-term stability of financing, at least in the form of 'working capital", to smooth out its flows of funds and to give some type of assurance to people with whom it deals. Judges and policemen need to know that they will be paid next month.
- When there is a sudden need like a war, it would be useful if the government had some type of wealth which it could call upon. We’ve read stories of Washington’s troops doing poorly, which their fledgling “government” was trying to raise funds
I think it makes sense to address the need for short-term stability of funding. To address it, the government needs to keep some wealth on hand. It would then draw upon this wealth for funds while adding to this wealth when it gets more voluntary contributions. However, I would not want to see a government that has wealth (say) to last 50 years, and thus did not have to be concerned with getting voluntary contributions. The need for on-going voluntary contributions is a good check on government.
It also makes sense for the government to have some type of reserve fund for war. Here too, though, having too large a war-chest can make government overly independent of the owners whom it supposedly is going to protect by fighting a war.
I think government wealth should not be in the form of stocks/bonds and so on. Best not to tempt politicians with the power to control such assets. If allowed at all, it should be via some “blind trust” like mechanism, and there ought to be all sorts of quantitative limits. It’s an issue of designing the right checks/balances. I think the best approach would be to disallow it altogether. I think a better approach would be so let private citizens set up such trusts and control them. For instance, suppose Mr. Morgan is going to give the government $1 million and the government intends to keep it in some form of wealth. instead, Mr. Morgan can just as easily set up an irrevocable trust, naming certain ends, and can appoint his private trustees to administer it. For instance, Mr. Morgan may say that the money in his trust is to be dispersed only if there has been a Congressional declaration of war, with the president taking some actions, and with some limits on how much of the funds may be dispersed… and so on.
One can speculate about the best type of structures, whether there should be some special type of trust, ad so on. Usually, this type of thing has to evolve through experience. Unfortunately, voluntary funding is not something any of us will see in our life-times.
What i suggested is a structure which is very similar to the fund rising organization.. Government will ask people to contribute voluntary not to the government as such, but to the government projects-for example railroad company run by government. If people decide that this is a good idea and good investment, they will invest in government project and become stock holders.That would resolve the problem of initial funds. Then, if government performs well, part of the profit will be divided between shareholders, part will be re-invested back into the project, part will finance non-profit government functions ( police, army, courts) and part will go to emergency fund-war, natural disaster etc…If government doesn’t perform and doesn’t show profits, then people disinvest, government will fall and people’ll elect better, more efficient representatives to run the government. (BTW, in such a situation the best government officials would be businessmen who want to be politicians) Still government can ask people to donate directly to the non-profit projects to ensure the legitimate government functions. If people trust their government they will donate money, if not-government falls, and the new government will try better. This is the real democracy, when the people vote with their money. Observe, that such an arrangement doesn’t violate the principle of separation of economy from state-in its economical part government doesn’t function qua government, that is- a tool of coercion. Government would be legally prohibited to pass any laws which regulate economical activity, it won’t be able to create government monopolies or legislate regulations in favor of the government’s enterprises. Economically government would act as any other corporation and freely compete with other companies on the level field.