At first glance, it doesn’t seem like the most profound insight in the world. But for our world, at this particular time in our history, it is the most critical insight to be had—and the tragedy is that hardly anyone has it.
Here’s the Tweet (yes, I’m still calling them Tweets), from Musk:
So what is so earth-shattering about this observation? We all know the DMV is terrible. For most of us, however, a visit to the DMV doesn’t take all that much time or energy, so we tolerate it…in much the same way that one tolerates the occasional root canal. Do we really need to dwell on why it is so utterly dysfunctional?
Yes. Yes we do.
Musk’s point does not only apply to the Department of Motor Vehicles. It applies to every single government program, and indeed, to every piece of our lives that government touches, which—just as de Tocqueville predicted 200 years ago—now seems to be every piece there is. And it is well worth noting that the DMV is one of the more benign manifestations of state power in our lives.
The word “inefficient” is far too gentle and sanitized a word to describe what governments actually do…
- Hundreds of thousands of people thrown in prison because they ingested, bought, or sold substances of which the government disapproves.
- Private homes and property seized by state officials under eminent domain—so that the folks who bought off the right politicians can have it for themselves.
- Hospitals ordered to shut down their most profitable services and then offered enormous sums of government money…but only if they agree to implement (without liability) protocols that will kill patients en masse.
To grasp the full scope of what the state is capable of, one need only look at the twentieth century’s brutal experiments with total statism, and the mountains of corpses those experiments left behind. Then remove the word “inefficient” from Musk’s Tweet and replace it with “inhuman and deadly.”
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Two Very Different Machines
Musk’s post points to the critical distinction between two fundamentally opposed—and yet frequently intertwined—systems for organizing society. It may be helpful to think of these two kinds of systems as two different kinds of machines.
On the one hand, we have a “machine” characterized by voluntary exchange and the legal enforcement of private property rights (including one’s right to control one’s person). In such a system, nobody has more rights than anyone else. Everyone is free to do whatever they wish with whatever is owned by them. Nobody is free to encroach upon others, or the property of others, and there are no special groups of people with special powers to override this restriction. We will call this the market machine.
The machinery of this system works by matching up the needs and wants of all the individuals within the system. This is an organic and unguided process: the people running the machine are, quite literally, each and every individual member of society.
Contrary to the rhetoric that prevails in some quarters, this machine does not function on exploitation, but on mutually beneficial exchange. Those using this machine thrive the most when they serve the needs of others. Each party walks away from a transaction having gotten something they wanted more (money, labor, goods, services) in exchange for something they wanted less. As a result, society’s real wealth increases over time.
On the other hand, we have a machine that runs on compulsion and force. We will call this the government machine.
People using the market machine may use force in defense of person and property, but they must never initiate it. The government machine, by contrast, gives those in power the “legitimate” authority to initiate force for their own reasons: to control behavior, seize property, and benefit some at others’ expense.
The machinery of the market system is controlled by everyone…and no one. The government machine, by contrast, is controlled by one or more groups of people to whom the machine grants special rights—including the right to use aggressive violence against other members of the society. And unlike the first machine, one does not benefit by meeting the wants and needs of others. Instead, one benefits by gaining access to the group with the special rights to use political violence, and then using that violence to take things from other members of society.
This is what Musk is pointing to when he says “…the feedback loop for improvement is broken, because they have a state-mandated monopoly and can’t go out of business if customers are unhappy.”
This feedback loop is built into the market machine. Those who do a poor job serving their fellows do not succeed and must change how they do things if they are to thrive. The only activities the market machine supports are those that produce things that people want and need.
In the government machine, this feedback loop simply does not exist. In the market machine, things occur because people want them and are willing to pay for them. Under a government, things occur because someone has the power to use the threat of violence to make them occur. In the government machine, “making customers happy” does not even enter into the equation.
Why would it? The “enterprise” (whether the DMV, government schools, the welfare state, war…) will continue to operate whether or not anyone is willing to pay for it voluntarily, because government officials have the power to take other people’s money to pay for it. “Choosing to pay for things voluntarily” is not one of the components of this machine.
A Pattern of Success
Today, most of the developed world lives in some mix of the two systems. Individual rights are upheld to some extent, but everywhere, there exist special groups, institutions, and agencies that have the power to override individual rights. And the extent to which these groups dominate a society is the extent to which that society is dysfunctional.
For anyone who doubts this, there are a few concrete indicators to which we can look.
First, every year, both the Heritage Foundation and the Fraser Institute rank countries by their levels of economic freedom. And every year, those jurisdictions with the greatest economic freedom also rank highest in every measurable indicator of human well-being, including prosperity, education, infant mortality, access to health care, and a cleaner environment.
Second, the graph below illustrates price changes for various industries over time. The industries depicted in red are characterized by a high degree of government intervention, while those shown in blue are less heavily regulated.
The results could not be clearer. The extent to which government is involved in society is the extent to which things do not work.
And remember, the phrase “does not work” doesn’t simply refer to irritating inefficiencies and mild inconveniences. At its worst, it refers to famine, brutality, subjugation, torture of political enemies, and the bodies of millions of men, women, and children who simply got in the way.
In this single Tweet, Musk has correctly identified the source of government dysfunction and, along with it, the source of so much of what ails our world. If we are to have societies in which humans can live together peaceably and flourish, we must build upon the machinery that we already know powers peaceful coexistence and prosperity. And we must abandon the machinery that can only generate the opposite.
Bretigne Shaffer is a former journalist who now writes fiction and commentary and hosts a podcast. She blogs at Bretigne, and her fiction writing can be found at Fantastical Contraption.
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