Revealed Preferences in Government Shutdowns

The US federal government, thanks to central banking, has an unlimited power to spend, so it almost never has to sacrifice anything to get what it wants. But there are a few brief moments where some procedural rules force Congress to act as if it had a finite budget. These “government shutdowns” give us a glimpse into how the federal government ranks the importance of its many jobs, and a chance to confirm or invalidate one theory of the state: that “the government is us” and more or less reflects our own preferences.

An article at Vox describes what stopped and what kept operating during the 2018 shutdown. This paragraph is instructive:

Drug Enforcement Administration and Bureau of Alcohol, Tobacco, and Firearms field offices are exempt from shutdowns; many Food and Drug Administration officials working on investigations, however, are not. The TSA is fully exempt, but the Centers for Disease Control and Prevention had to furlough a large fraction of its staff. Civil litigation efforts at the Department of Justice (including antitrust investigations) would cease; the Occupational Safety and Health Administration and the Mine Health and Safety Administration would be, temporarily, all but gutted.

The article lists others, and in the 2013 shutdown, Washington went out of their way, without irony, to barricade monuments.

But look closely at the exemptions. My favorite example is the TSA. By all objective measures, the TSA is at least useless and probably worse than useless. It costs about $8 billion per year to run. Without belaboring the point too much, the whole thing is security theater. It’s a farce, and everyone knows it.

So which would you prefer Uncle Sam do without in an emergency? The people who ostensibly monitor and contain diseases? The people who prosecute and resolve civil court cases? Or the useless orcs at the airport that treat you like a prison inmate for no reason? The question answers itself.

The agencies receiving unconditional support tend to be enforcement arms or payouts to powerful constituencies, regardless of their efficacy or desirability. The military, as well, carries on as usual even though soldiers are temporarily denied their paychecks. The expendable ones tend to be citizen-facing services whose absence will cause the greatest amount of discomfort without damaging the state’s ability to impose its will or pacify possible resistance.

In a Machiavellian way, it does make perfect sense for the state to defend its supremacy at all costs. This isn’t illogical in the slightest. But the shutdowns reveal this to actually be the case, and not the comforting euphemisms we often hear about the government. Murray Rothbard asserts in Anatomy of the State that the government is not synonymous with the people. It is a different thing from society, with its own interests, which can be at odds with the people it governs.

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