Precarious privatization

The conflict of interests spoken of last time dealt specifically with education, but that is not the only area in which we should be a bit more cautious. I realize there are many out there who are strong advocates of free markets, but they've really got no support to fall back on. Not every area of human endeavor is a market, nor should it be. And, there are some things that may look like markets but aren't.

Now, for all of you who now want to start beating me over the head with Adam Smith, I would ask that you at least read him before you use him as a weapon. The good scholar (a moral philosopher, no less, whose Wealth of Nations is hardly comprehensible without first understanding his Theory of Moral Sentiments and I'm guessing only a handful of people alive today have ever read that). Mr. Smith may have been skeptical about too much government, but he was a strong advocate of government in that it should oversee and take care of those areas which would not naturally profit a private individual. Government, in Smith's eyes was there to provide a justice system, enforce contracts, grant intellectual property rights, but also to provide public goods such as infrastructure (roads, bridges, transportation means, national defense, and one would suspect utilities). He supported public education and religious institutions because he believed they provided a general benefit to society, and most strikingly, he advocated protecting infant industries and regulating banking.

In other words, the "patron saint" of the free market was only in favor of those areas of endeavor that lent themselves to being regulated by the laws of supply and demand. He suspected that if left to their own devices, business would collude to the disadvantage of customers, therefore oversight was necessary. He was also in favor of several forms of taxation, such as taxes on rents, and was a very strong advocate of progressive tax rates: those who earn the most should contribute the most to the common good. For Smith this is common sense; for his so-called followers ... well, most of them ignore in him what they don't want to see.

What we learn from Mr. Smith, then, is that anything that has to do with the common good, with providing benefits to everyone, not just a privileged few, should include government involvement. The government also has a right and a duty to tax so that the common good may be assured. The solution to too much government spending is more discipline, to be sure, but it is not to turn over public trust to the private sector. Even Adam Smith knew that too much money in too few hands did too little good to too many people.