Big Government, Like Big Corporations, Ultimately Become Unmanageable

One of the facts that the left continually ignores is that some institutions become so large that no one, neither an individual nor a group of people can manage them. Currently the Biden administration and the Democrats in Congress want to spend another $1.9 trillion they don’t have and can’t raise though taxation when they have not spent all of the money they had appropriated previously. Furthermore much of this proposed spending has nothing to do with relieving the problems created by the Corona Virus. It seems that the Democrats want to pass this monstrosity simply to show that they have the power to do it. Of course, once it’s passed, the next problem will be distributing the funds to the intended recipients.

This leads back to a comparison one of my economics professors made in undergraduate school in the late 1960s. “General Motors is a socialist economy with a GNP that is slightly larger than Poland.”

We all know what happened to the old General Motors; it went bankrupt despite its size, or perhaps because of it. The company began to make inferior products that did not hold up. It lost touch with its customers and build ugly cars. Does anyone remember the ugly, “boxes on wheels” Oldsmobiles and Cadillacs from the 1990s? And it lost control of its labor force. In the end if made no difference if a union employee was laid off off or on the job; he or she got about the same pay.

The Federal Government has reached this point, and yet the left wants to make it even bigger. The left shouts down any suggestion that the states might be able to administer some programs better. So far as the left is concerned, the only solutions are to give more power to an already bloated, highly inefficient system.

Or as the economists say, Diseconomies of scale.