I don't understand how we continually believe the governments know how to spend money better, HN is littered with examples of government projects that have been woefully inefficient with the money they've taken.
This is of course true, but the opposite it true as well. Regardless, this misses the point. The reason people want public interest spending to be conducted by the government is that, with government spending, there is at least some opportunity for democratic (i.e. public) oversight. With private spending, there is only oversight from invested parties.
Look at the F35 thread that appears here now and again. Loads and loads of congressional districts involved, loads and loads of people with a stake. It still ended up costing an insane amount more than it needed to.
With private actually I don't think it's all that different though, the difference is some of the private ventures are allowed to die once the failure is complete.
Totally agree that public interest ought to matter, just I don't see that it actually holds people to account.
There's an argument that you get the same dynamic either way. In political science it's the problem of "concentrated benefits and diffused costs". Only "invested parties" pay for lobbyists (e.g., Intuit/Turbotax). Others (e.g., everyone who does taxes once a year) find it easier/"cheaper" to put up with the annoyance than to exercise "oversight".
Most businesses fail. Hell, most Google products have failed. As such, overall private spending is woefully inefficient (despite a few big successes), and government spending is relatively very efficient.
Governments have the ability to tax in order to fund spending.
Businesses have to fund their spending out of either their revenues or their debt/equity funding. Is it any wonder that businesses fail more often than governments?
If the measure of government efficiency is return on the tax dollar, then by the same yardstick the benefits generated by most businesses are infinitely efficient.
- first, government spending is highly scrutinised, by the convention that people expect every tax dollar to be spent in a way that they deem worthy;
- whereas, most private businesses are not scrutinised in any sort of comparable way (often not even when they are spending tax dollars - which they can, directly and indirectly).
Remove: Sales Tax, Punitive Fines, Import Taxes, Stamp Duties
Keep: Income tax (even raise it if you want)
Add: Held wealth tax (if you want, or go full progressive and replace income with this)
Imagine a government uses tax payer money to install a bench in the park. This bench has a distinguished businessman’s name brazened on the front of it, and this bench is poorly placed and no one sits in it, providing no utility to society. In this example, the public has every right to be disgruntled, they can call their representatives, media organizations etc., or just talk about the stupidity and incompetence of their government and vote new, equally incompetent, people in their place instead. When a government does something like this, it’s not working right.
Imagine the park is owned by a private nonprofit. The business man donates money to the nonprofit to install the bench, the business man gets a dollar for dollar tax deduction on the bench, and the nonprofit rewards him by having his name put on the bench. No one uses the bench and it provides no utility.
In either case, the real results for society is the same. The only difference is that for the nonprofit case the system works the way it’s supposed to.
In real life what you get is that moneyed elites get a boost in status from their donations. How can you demand demand good behavior from people with no accountability?