Photograph Source: USCapitol – Public Domain
Elon Musk has been running wild with his DOGE team, on the one hand pretending shock over facts that were always public information, and on the other hand getting into our tax, banking, and medical records where he has no business being. However, the unifying theme of his quest is supposedly to shut down the deep state, and by some accounts, dismantle the federal government.
Many liberal types are all too willing to accept the latter claim. The idea is that Musk and his crew somehow want a world without government. This is self-serving crap that no one who is not on his team should ever accept.
These self-imagined libertarians want government for all sorts of things. The small grain of truth to the story is that they don’t want government social programs that help people who are not rich. Musk’s view is that the government should only be there to make him and his fellow billionaires richer.
Starting with my favorite, government-granted patent and copyright monopolies come from the government. I know the beneficiaries want us to believe that they came from God, but those of us who have not taken a vow of stupidity know better.
And these government-granted monopolies are hugely important in determining the distribution of income. In the case of pharmaceutical products alone, patents increase what we pay to those in a position to benefit from this monopoly by close to $500 billion a year. That’s roughly half of what we pay out each year in Social Security benefits.
And that’s just the beginning, we pay big bucks for medical equipment, iPhones, computers, software and many other products because of patent and copyright monopolies. If we add all of these together, we are almost certainly talking about well over $1 trillion a year, close to half of all after-tax corporate profits.
Does Elon Musk and his band of anti-government libertarians want to get rid of these government-granted monopolies? To be clear, these monopolies serve a purpose in promoting innovation and creative work. But they are not the only way to provide this incentive, and more importantly for the question at hand, this does not change the fact that these monopolies are government.
Next let’s ask our billionaire libertarians in finance if they want to get rid of government deposit insurance for banks and other financial institutions. There don’t seem to be lots of libertarians pushing for that.
And when banks manage to blow themselves up through their greed and incompetence, as happened in a big way with the housing bubble and its collapse in 2008-09, and more recently with the Silicon Valley Bank panic in 2023, the libertarian billionaires are first in line demanding the government come to their rescue.
This is only part of the story of how the government makes money for finance. As Musk showed us this week, it can create markets for the industry by not providing more efficient competition, as he sought to shut down the I.R.S.’s free direct file system. There is a much bigger story here with Medicare. We could have a much more efficient insurance system if we had Medicare for All, but that would wipe out the private insurance industry. Instead, we are going the other way and whittling down traditional Medicare and increasing costs by pushing people back to private insurers with Medicare advantage.
Elon Musk wants to get rid of all government regulation. That’s cool, so everyone can use whatever broadcast frequency they want whenever they want. That will be great news for radio and television networks. I gather Musk wants to get rid of the federal air traffic control system that determines flight patterns and take off and landing paths at airports. Oh, I guess Musk probably doesn’t mean those regulations.
This list can be extended at length. Section 230 protection for Elon Musk’s social media platform didn’t come from God. Labor laws in the U.S. that prohibit secondary boycotts (which shut down Tesla’s operation in Sweden) are also not God-given.
Even “regulations” that limit greenhouse gas emissions can be seen as simply a form of property rights. People don’t have a right to dump their sewage on their neighbor’s lawns. In the same way, they don’t have the right to dump greenhouse gases into our atmosphere that destroy the planet.
And yeah, the corporate structure itself is created by the government. We can all form partnerships with our buddies where we act collectively in forming a business. But then our names are associated with all our business dealings, and we are personally liable for all the partnerships liabilities. How many people would be throwing their money at Elon Musk and Tesla if they could be personally sued for whatever idiocy Musk got himself into?
The point here should be clear to anyone not totally blinded by ideology; government regulations structure the market. A modern economy cannot exist without government regulation. When Elon Musk or anyone else says they want to get rid of government regulation they are lying. It’s that simple.
It is absurd that people on the left have allowed the Musk billionaire libertarians of the world to pretend they are anti-government. They just want a government that only serves their interest rather than society as a whole.
As a political matter it is incredibly important that we start to make this point very clearly. The issue is not that we are defending government against its opponents. We are defending a government that serves the public as a whole and not just a small clique of billionaires. That should be a winnable battle.
This first appeared on Dean Baker’s Beat the Press blog.
