By Noah Dawson
Few thinkers over the past century have contributed as much to as many areas of thought as Friedrich August von Hayek. I’ve written and spoken about him several times before, specifically his work “The Road to Serfdom.” Still, I feel that there is one point in his writings, the refutation of the myth that government must grow as society grows, which I feel deserves an even closer inspection, especially with recent tax increases as a result of municipal bonds.
City manager Jared Miller has several times defended having the city go into debt for the simple reason that it is easy to go into debt. There also seems to be a popular idea that we had to go into debt since we are a growing city. Further, the city council has also defended a recent tax increase by pointing to the bonds, implying that it is inevitable for us to increase taxes because of them. By applying all of this logic, we get the idea that everything is fine, because taxes are inevitably going up because we needed to go into debt. In fact, this is all a quite good thing if we consider that going into debt was both easy and inevitable.
Is any of that true though? I’m not so sure. First off, as I’ve mentioned in previous speeches and writings, going into debt just because you can is misguided, and has been a primary source for financial ruin over the past few centuries. But, what about going into debt because we need to go into debt? What about increasing taxes because we had to go into debt? Well, putting these ideas together shows why it’s a bad idea. To explain, let’s construct a hypothetical scenario where the city is a private business instead of a government. There are certain investments the business feels would improve the business, so it applies for a loan. If the investments are good investments, they pays for itself, and prices don’t have to increase in the long run. If the investments aren’t successful, the business must find other ways to pay back the loan, charging customers more. Now, let’s apply that logic back to the city. The city went into debt. If the debt really was for good investments, it would improve economic conditions, raising revenues, all without forcing the city to raise taxes.
I’m sure people supposedly more familiar with the finer points of city management might find this analysis to simplistic. They have their formulas and bureaucratic policies which inevitably lead to higher taxes. To this end, it must be realized that such policies aren’t without flaws. None of them arise from immutable forces of physics. They are man made constructions built with fallible attempts at economic analysis.
So, is it inevitable that government will grow? Was Mussolini really right when he claimed that “The more complicated the forms assumed by civilization, the more restricted the freedom of the individual must become?” The answer is no. We can take charge of our own futures. We can push our city forward without relying on politicians to guide us there. But, until we stand up to those who actively grow government, it will continue to grow. I hope that voters keep that in mind when they cast their ballots in the upcoming midterms and next spring’s municipal elections.
