Chapter 3
The Limits of Government
The Two Experiments
• Democracy
– Open system, suceptible to influence
• Capitalism
– Gated/closed system
• Capitalism appears to distort democracy
more than the other way around
History of Regulation
• Often regulatory agencies begin with true
zeal
• Gradually become influenced by the very
industries they are supposed to regulate
– Head of EPA air division is a former utility lobbyist
– Head of public lands in the Interior Department is
former mining industry lobbyist
• Representatives aren’t immune to influence
either
– Pharmaceutical industry employs 2 lobbyists for
every 1 member of Congress
– “For a paltry $5 mill. In campaign contributions,
the broadcasting industry was able to secure free
digital TV licenses, a giveaway of public property
worth $70 billion - a 1.4 million percent return on
The Limits of Regulation
• Only responsive to money and votes
• Difficult for future generations,
ecosystems and other species to be
represented
• Government contains inherent bias
towards property owners, excluding
everyone else.
Limits of Taxation
• Who sets the tax?
• Who pays the tax?
• Where does the money go?
– Historically the military industrial complex
• How is an appropriate amount decided?
– Politicians need to consider re-election,
making adequate taxes difficult to impose
Limits of Public Ownership
• Often these natural resource are given to
industry at subsidized prices
– Since 1872 mining companies have been able to
purchase public lands at $5/acre with no royalties
owed to the public.
– Actions are dictated by politics not fiduciary
responsibility
• Little regard for sustainability as long as income streams
continue to flow
State trusteeship has proven much more sustainable in
economic and ecological contexts. (I.e. Alaska permanent)
Things to remember
• Ownership vs. Trusteeship
– Ownership involves more potential for abuse, than
legally bound trusteeship
• State does not necessarily promote the
common good in every instance
• Large concentrations of wealth distort the
advantages of a democratic government
• Government should be used not for short
term taxing and regulation, but for
assignment of responsible property
trusteeship.