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Elizabeth Warren’s ‘Social Contract’ an Ideological Fantasy

Warren and other politicians should not be able to dictate what "hunk" of the earnings of others they forcibly seize.

by
Ari Armstrong

Bio

September 28, 2011 - 12:00 am
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Obviously, mere access to governmental services does not create a successful business leader; otherwise, everyone would be a wealthy entrepreneur. Steve Jobs did not build Apple computers, Mark Zuckerberg did not create Facebook, and aspiring presidential candidate Gary Johnson did not grow a multi-million dollar handyman service because politicians and bureaucrats helped them. Instead, business leaders succeed by intelligently working hard to provide the things their customers want. They succeed despite the onerous taxes and controls of government, not because of them.

Notably, the core governmental services that protect people from harm — the military, police, and the courts — constitute a sliver of the the budget of federal and state governments. Most political spending goes toward entitlements at the federal level and welfare or union-dominated education at the state level.

Moreover, businesses directly pay for many of the services that Warren mentions. Businesses pay for their road use through gasoline taxes. Any given business faces a miniscule risk of a large fire breaking out, because businesses provide their own sprinkler systems, alarms, and other fire-prevention infrastructure. Private firms hire more security guards than the total number of police officers in the country. Regarding education, not only do many business leaders finance schools and scholarships, but businesses spend large sums training and educating their employees. (Whether government ultimately should provide services not directly related to law and order, and if so how, are broader issues.)

Warren presumes that politicians and bureaucrats in Washington can spend the wealth created by business leaders better than they can manage themselves. The failure of government-backed Solyndra illustrates some of the problems with that thinking. The wealthy don’t just light fires with their extra cash; they invest it in their own business or the ventures of others, spend it with other firms, or voluntarily finance the charities of their choice. The notion that the likes of Nancy Pelosi can spend the money of Amazon’s Jeff Bezos better than Bezos can is laughable on its face.

Warren contends “there is nobody in this country who got rich on his own.” In a sense she’s right: people get rich by providing enormously valuable goods and services to others who willingly pay for them. Warren and other politicians should not be able to dictate what “hunk” of the earnings of others they forcibly seize. Any social contract consistent with justice recognizes that legitimate government does not loot “the rich” (or anyone else) but instead protects people’s rights, including their rights to their earnings.

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Ari Armstrong publishes FreeColorado.com. He runs Liberty In the Books, a monthly free-market discussion group, and he is the author of "Values of Harry Potter."
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