“For what this transition boiled down to was a system of private government ownership – a private monopoly-being replaced by a system of public government ownership-a publicly owned monopoly…A king owned the territory and could hand it on to his son, and thus tried to preserve its value. A democratic leader was and is a temporary caretaker, and thus tries to maximize current government income of all sorts at the expense of capital values, and thus wastes.” – Natural Elites, Intellectuals, and the State
In the economic concept called The Tragedy of the Commons, we find how public land leads to overuse as everyone tries to get their fair share before the benefits are eaten away. With no incentive to conserve, exploitation of resources can lead to the point of unsustainability. Here, short-term consumption supersedes any motivation to adopt a long-term vision of the asset in question. The same is true for renters and owners. When someone owns property, there is an enormous incentive to maintain it, for one day there may be a need to sell it, and maximum profits would be desirable. When renting, however, there is little reason for a long-vision orientation to spend time and money on maintenance, because if one does not own the property, they have no financial attachment to it.
In Hans-Hermann Hoppe’s 1992 book of essays, “Natural Elites, Intellectuals, and the State”, Hoppe reveals why democracy is not the utopia many believe it has been, and how it may be a cause of civilization’s decline. Since the end of World War I, the ruling monarchy lost favor and was replaced with the idea of democracy which was rapidly spreading worldwide. Yet, despite its earlier appeal, it has done little more than cause non-stop war, debt, and an entitlement system growing to insolvency. Hoppe makes his case by revealing how the devolution from private ownership to public management has negatively affected not only our prosperity but the role of intellectuals, entrepreneurs, and the proletariats in society.
Expanded upon in his 2001 book, “Democracy the God that Failed”, Hoppe reveals how rapidly newly enshrined democracy used its monopolistic grip to grow its power. The state, over time, has passed and enacted tens of thousands of laws and regulations, to control every aspect of life, nullifying natural laws, and resulting in a significant loss of personal autonomy. To climb the ladder of success under democracy, one must increasingly seek political influence as the size and scope of government grows. Privileges then become a commodity to be bought and sold.
Since the monarchs essentially owned their countries, like homeowners, they were incentivized to employ time preference and held exclusive control over their property. When the monarchy ceded to democracy, the incentives changed. Democracy removed private incentives and replaced them with a public free-for-all. As short-term owners, politicians shunned a long-term plan and instead settled for temporary gains. By spending and consuming in the present, they were able to use the government to their advantage without suffering any of the ensuing consequences. The result has been massive growth in government spending, with massive debts leading to inflation. Worst of all, a move from private accountability to public immunity has resulted in a weakening of personal responsibility and a loss of long-held social customs.
Since the rise of democracy in the twentieth century, there has also been the rise of war, crime, and the genocide of more people in human history. But democracy also raises the wrong people. With growth in special interest groups, it has not only failed to lift the working class but usurped the wealth and productive use of the entrepreneur class through taxes, and nonstop hurdles to prosperity. Democracy makes wealth accumulation by proper means more difficult. Since democracy is primarily a political system of majority rules, the majority votes for the majority's benefit, often at the expense of the minority. The negative consequences have been not only neglect of protecting rights and property but a threat to their very existence.
Since the government is force, those who fare best under democracy are the state itself, and the bureaucrats that manage it. Therefore, it is unsurprising that the new rich rose from favors doled out by bureaucrats. Hoppe’s remedy for democracy’s failures includes secession, federalism, or all-out replacement with a stateless society. A return to a voluntary natural order would make use of defined private property, markets, and unfettered competition, allowing natural elites to rise once again.
Since the election of Donald Trump to the presidency in 2016, numerous pundits have repeatedly sounded the political alarm that our democracy is under attack and what we must do to save it. Instead, maybe we should question whether democracy is the best political system based on what we know now. Perhaps it’s not.
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