When the untutored mind first contemplates government, fragmentary perceptions make it seem that government really is a wealthy, powerful, and effective problem-solving institution. A child just becoming aware of government and public policy will normally say that government should fix things and take care of us. His mind produces this opinion in just the way that it produces the opinion that the world is flat. As he matures, he begins to overcome the illusions. He gains more knowledge about government, and he also brings to bear his own innate “illusion-busting” cognitive abilities. This process of maturation produces, in the typical case, political views that are a mixture of the underlying illusions and more sophisticated understandings. The illusions are no longer accepted in simple, unvarnished form, but they still influence thinking about what government should do and what it can accomplish.
In this excellent little book, political scientist James L. Payne exposes six illusions that exert a persistent influence on the way people think about government. He begins by noting a paradox of modern politics: disappointment, cynicism, and complaints about government seem to be ever present, but still people continue to place their hope in government; people seem to dislike how government works, but still they call for more government. This inconsistency in attitudes toward government is a world-wide pattern and prevails among all classes of people from untutored to highly educated.
The public in all countries is generally critical of national leaders and sceptical about government's capacity to operate successfully. Yet this same public is eager for government to take a bigger role in addressing every problem that attracts its notice, from transportation to scientific research, housing, and labor relations.
The phenomenon is far from new. Payne quotes Herbert Spencer who wrote in 1853, "Take up a daily paper and you will probably find a leader [op-ed] exposing the corruption, negligence, or mismanagement of some State-department. Cast your eye down the next column, and it is not unlikely that you will read proposals for an extension of State-supervision." There are plenty of good reasons to be sceptical about government, but why doesn't this scepticism lead people to turn away from big government? Payne notes that some commentators have attempted to explain this by pointing to a school system that indoctrinates students into wanting more government or to lobbying by special-interest groups and government officials who want to ensure an ever-increasing flow of taxes into their own pockets. But while recognizing that there may be a grain of truth to this, Payne thinks that these are not the main explanations. He rightly emphasises that "schoolteachers, politicians, and pressure groups would not have succeeded in fostering big government if people in general were not already receptive to it." Payne's answer is instead that the appeal of big government is rooted in thinking that has been distorted by a set of illusions about what government is and what it is capable of accomplishing.
The errors I point to are not mere mistakes - errors of fact or simple misinformation. They are impressions that the naive mind has when first presented with the phenomenon of government. They are like the impression of a flat earth gained from looking across a prairie. The land does indeed look flat, and if someone tells you it's not, your mind retains the impression of flatness. But first impressions are important, and these impressions retain a hold even in the mature mind. Government is a gigantic, complicated structure that has no counterpart in our daily lives and personal experiences. As soon as we hear about it, we start forming opinions, opinions based on first impressions and naive assumptions. These opinions are illusions, ideas that are fundamentally false and misleading, but that nevertheless become embedded in our personal worldview.
It is becoming increasingly recognized that we form beliefs first (for non-rational reasons) and then we attempt to rationalize the beliefs we already hold. Our brains manifest a host of cognitive biases that continually confirm our beliefs as "true". Many doctrines are systematizations and rationalizations of intuitions that themselves lack rational basis and it is even worse when it comes to political doctrines as there is very little incentive for thinking rationally about politics. Six Political Illusions has six chapters, each devoted to one illusion. The introduction and the first chapter are available for free on the authors website. I comment briefly on each chapter.
The philanthropic illusion: the idea that government has money of its own
Payne believes that when most young people first contemplate the political realm, they begin with the naive view that government is a rich philanthropist. From such a perspective, government payments to nice-sounding causes seem unambiguously good and helpful. If asked whether government should promote art and education, the answer would be an unhesitant "yes". The problem, of course, is that the government does not have any money of its own. Any money that it has to spend has first to be taken away from a nation's citizens. As people mature, their naive first impressions "becomes overlain by more sophisticated ideas"; they become aware that government raises money through taxes and they become aware that they themselves pay taxes. "For many people, however, the philanthropic illusion is not fully overcome and consciously discarded. It remains lodged in their thinking, giving them a falsely positive view of government spending programs."
Laboring under the philanthropic illusion, politicians and the public are treating government as a source of funds. In the grip of this illusion they assume that government can always spend more for some good purpose.
The result of this approach is a vast vicious cycle of multiple subsidies. Government taxes homeowners to provide assistance for farmers, then taxes hospital patients to provide benefits to homeowners, and then taxes farmers to provide benefits to hospital patients, and so forth. This arrangement is not only economically self-defeating, but socially unhealthy as well. It invites everyone to try to live at the expense of everyone else by engaging in lobbying and agitation.
Payne notes further that "two of the most commonly heard arguments in support of government spending are outgrowths of the philanthropic illusion": that spending "puts money in circulation" and that "it creates jobs". Both are fallacious because whatever money the government "puts in circulation" by spending is at the same time taken out of circulation through taxation.
The voluntary illusion: the impulse to want to believe that government action is not based on the use of force
There is no denying that government is based on force. As Payne explained in another excellent book A History of Force (my review here), the world has experienced a broad evolution against the use of violence. This evolution is reflected both in our practices and in our attitudes. In advanced cultures, force is considered a primitive, barbaric approach. Payne notes that this modern distaste toward force "creates a powerful psychological pressure to repress the recognition of government's coercive nature". This need to repress the ugly side of government's action is the basis of the voluntary illusion.
Payne invites the reader to test this illusion by asking friends and neighbours if government is based on force. Many people will flatly say "No", others will exhibit evasion, confusion, or even embarrassment, and yet others will say that government's use of force - armies, police, prisons, etc. - is not "really" force. "They see some special character about government that transmutes its violence into something else, something nicer that they can approve of." Payne exemplifies with his friend Nancy. When asked "Is government based on force?" she replied "Well, it shouldn't be" and added "I suppose that's dodging the question". Payne's analysis:
She knows in one corner of her mind that government is based on force, which she deplores. Yet she looks to government to fix society's problems. She feels that Social Security, Medicare, food stamps, public education, and so on, are desirable programs. Hence, she is conflicted. She doesn't want to disparage the big government she likes by recognizing its distasteful foundation in brute physical force.
He also notes that people with radical, revolutionary political views often portray their imagined utopias as entirely voluntary, thus failing to acknowledge (to themselves and to others) the force that would be required to bring about such radical ideals and to suppress dissenters.
The illusion of the frictionless state: the idea that the state can transfer resources with negligible overhead cost
Even if the first two illusions had been overcome and it would be explicitly recognized that government spending involves taking money away from other uses and that this is done by force or the threat of force, it might still be judged to be worth it. A third illusion, however, lead people to ignore the inefficiency and waste in government's system of transferring wealth from some people and delivering it to others. We fail to adequately take into account administrative costs (the expense of running the bureaucracies that redistribute tax burdens and benefits), compliance costs (the time and money spent by firms and private citizens in trying to comply with the tax system), disincentice costs (taxes weaken the incentives for constructive activities that produce income like working, increasing production, starting new businesses, etc.), misallocation costs (bureaucracy's misuse of labor and capital due to the distorted incentives of government employees), lost production costs (subsidies that encourage recipients to leave economic resources idle), and overconsumption costs (when government supplies a good or service for free or below cost, people consume more of it than they otherwise would), etc. Payne identifies a total of 14 different overhead costs that add up to a waste factor of several hundred percent! Payne has elaborated on this topic in the aptly titled book Costly Returns.
Payne argues that in many other areas we include known inefficiencies, obstacles, and imperfections in our thinking, but "when it comes to politics, the human mind does not function in this sober, sceptical way". "Practically no one realizes that research needs to be done on the efficiency of government transfers because the instinct to wonder about costs and waste is dulled by the illusion of the frictionless state." Perhaps the greatest victims of this illusion, Payne suggests, have been scholars and philosophers:
The philosopher sees his task as that of describing an ideal and considers it beneath his dignity to bother about operational details, such as costs and inefficiencies. He is like an architect who designs an aesthetically pleasing building and assumes that engineers and accountants will figure out how to construct and pay for it.
If one recognizes overhead costs, it becomes apparent that in a system in which "everyone pays for everyone else's goods", everyone loses - big time!
The materialistic illusion: the belief that money alone buys public policy results
"We should spend more money on education!" is a typical suggestion, but spending more money on something is not sufficient for improvements. Indeed, in some cases, spending more money on something can have zero effect, or worse, even exacerbate the very problem one is trying to solve. When we grapple with problems in our daily lives, we are usually rather well aware of the human factors (skill, motivation, etc.) needed to make the expenditure of money useful, but when our attention turns to public policy we tend to ignore the human factors. "National problems are treated as large, abstract blocks: 'unemployment', 'substance abuse', 'illiteracy'. The individual involved in these broad problems are lost from view - and so are their values and motivation." If we have succumbed to the materialistic illusion, we "see government as a store with social goods for sale: green energy, education, art, housing, job training, and so forth. If you want more, you simply buy more. The result is that we end up "throwing money at problems".
The watchful eye illusion: the idea that government has greater knowledge and wisdom that the public
"The idea that government has superior wisdom is to some extent rooted in the tendency to view government as godlike, an impulse that goes back many millennia." Part of this tendency stems from a natural human desire for a higher authority. The world is a confusing, challenging place, often posing problems that humans cannot immediately understand. We find it reassuring to suppose that some higher, wiser person or entity has all the answers. As Payne put it in Overcoming Welfare:
By looking to this entity, we can believe that a world that may be outside our control is at least not out of control. For thousands of years, government has filled this yearning for a supreme entity. Men have looked to pharaohs, emperors, and kings to organize the world and to tell them what to do. This primitive impulse has been dressed up in intellectual garments by theorists who claim that central control is necessary for a just, efficient society.
The analogy with religion is obvious and it is not surprising that the politically ambitious throughout history often have appealed to divine powers to maintain the illusion of legitimacy. Sociologists call this the “symbolic base of power”. As Jonathan Turner and Alexandra Maryanski have pointed out in their book On the Origin of Societies by Natural Selection (my review here), religious beliefs "began to legitimate power in horticultural systems, with leaders being viewed as god-like or, at a minimum, as agents of the gods whose directives must be followed because they embody the wishes of the supernatural". We can still see the traces of such practices in our modern (supposedly secular) societies.
But to think that government has superior wisdom is, of course, a fallacy. While it is certainly true that individuals do not always know what is best for themselves, we should not forget that governments are made up of ordinary people who are just as confused and misinformed as the rest of us can be. Indeed, there are strong reasons to believe that people are much better at making choices in the private sphere than they are at making collective choices through majority voting.
The illusion of government preeminence: the belief that government is the only problem-solving institution in society
The final illusion makes people think that they face a choice between relying on government to solve society's problems or to leave these problems unsolved. This is a false dichotomy because the alternative to government is not nothing, but the problem-solving abilities of what Payne calls "the voluntary sphere".
Humans are a problem-solving species. Having spent millennia grappling with the challenges of existence, we have learned the lesson that there is a tool for every task. If you want to dig a hole, a shovel will solve the problem; to sew a shirt, you use needle and thread; and so on. It is therefore natural that when we contemplate social and economic problems, we assume there must be a way to fix them. [...] When we look about for the machine that's supposed to address society's problems, our gaze falls on government.
It is understandable that when a national (or global) job needs to be done, people look to the big, powerful, and seemingly effective entity that looms large in their field of vision. The illusion of government preeminence makes us overlook the more elusive voluntary sphere: individuals and groups working separately or together to make the world around them a better place driven by their various private motives including generosity, compassion, desires for material gain, etc. Most problems have indeed been solved in this way, even if political institutions have often been given undeserved credit.
Payne notes that the dynamics of democratic elections reinforces the illusion of government preeminence.
Elections focus attention on what government can do. Candidates vie with each other in emphasizing the social and economic problems of the day and in promising to use government to fix them. Candidates who say government should not be used to solve problems appear negative and unsympathetic, and they tend to be weeded out of the system. [...] Electoral campaigns shortchange the mention of the voluntary sphere. It would not make much sense for a candidate to run for office by pointing out that nongovernmental groups, individuals, families, and businesses can solve social problems.
Payne also notes that government weakens the voluntary sphere in three ways: (1) by seizing roles; (2) by taking resources away from it through taxation; and (3) by constraining freedom of action through its regulations. Further, when both the public and the politicians believe that government is the only problem-solving institution in society, "constitutional restraints will not keep them from turning to it to handle everything" with the result that governments can keep growing despite numerous checks and balances.
That governments do not have any money on their own; that its operations are based on force; that there are overhead costs involved in every government program; that throwing money at problems is not sufficient to solve them; and that governments do not have any superior knowledge, might all seem obvious when you think about it. The problem, I guess, is that most of the time a lot of people don't think. I strongly wish that the contents of this book would be taught in every high school and that every journalist would go through these six political illusions like a check-list before they comment on public policy. Though, I’m not hopeful as the news media are competing for consumers who don’t want to have their illusions shattered.