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Source link: http://archive.mises.org/16795/auction-off-the-state/

Auction Off the State

May 5, 2011 by

The government has a huge collection of assets that could be sold to the private sector. Going, going, gone! FULL ARTICLE by Robert P. Murphy

{ 17 comments }

Ned Netterville May 5, 2011 at 9:02 am

Control of government-owned assets is a prime source of bureaucratic power. Such assets are to the bureaucritters what the wealth of private-property is to the owners, but without the responsibility, productivity and efficiency of privately owned assets. The concept got a huge boost with Thomas Jefferson’s illegal purchase of the Louisiana territories with government funds. I am all in favor of deficit spending until the government is so tapped out it is forced to sell its holdings–all of them. I am for auctioning off everything. I am for giving it away, perhaps as reparations for the damage, injuries and injustice the government has perpetrated. Stripping government of assets is stripping it of illicit power.

Anthony May 5, 2011 at 2:45 pm

Giving it away to whom? That is the tricky part…

Dick Fox May 5, 2011 at 9:27 am

Bob,

I am sick of those in government who whine because we have a poor economy. There are many solutions and the most effective would not require cutting any of the programs that actually help people.

You have pin-pointed one of the easiest ways to solve our problem, but those whinning about the problem actually don’t want it solved. They have found that whinning is a politically winning technique.

Jim Chappelow May 5, 2011 at 10:13 am

Bob,

Nice post. I made most of these same points on a public radio appearance last month. Another point to consider is the spending on the wars, budgeted around $175 billion/year, which by it self could fund federal debt service for nearly a year and is entirely under executive branch discretion. With bin Laden officially dead, now might be the perfect time to declare victory and come home and avoid the “inevitable” default at the same time.

Elwood P. Dowd May 5, 2011 at 11:22 am

Since when does the libertarian position concede to the government the “right”
to claim all unowned property as their own? Government “sales” of unowned
mineral resources (or “public lands”) is just another type of statist theft.
Such a shame that libertarians can have such little respect for property rights.
The heretic and poor lost soul, Sy Akhplart

Anthony May 5, 2011 at 2:49 pm

Those public lands need to get into private hands somehow… auctioning at least gets the property into the hands of those who value them the most (and have the most productive uses planned for them).

I agree with the principle that the government does not have claim to the land, but at this point I don’t see any better way to privatize them.

Elwood P. Dowd May 5, 2011 at 9:23 pm

Maybe the government should auction off everything else that is ours by right but they claim to own. Like free speech, the right to bear arms, freedom of assembly, the right to due process. Maybe the government could charge each of us for the right to not be a slave. Why stop at property rights, charge everyone for every inalienable right under the sun. Like I said, a shame that libertarians can have such little respect for property rights.
The heretic and poor lost soul, Sy Akhplart

Anthony May 5, 2011 at 10:48 pm

Elwood,

Things like free speech, free assembly etc. are inherent to self ownership, as is the right to own property. The ownership of any particular piece of property is certainly not “inalienable”, however, unlike the other rights you mention.

Who exactly has property rights to “public property”? For example, who do you think should own the offshore oil reserves? How could they demonstrate that ownership? I agree that in a free market the issue would be easy to deal with, but what about the transition? Should the government just announce “everything we own is up for grabs” and the first person to assert ownership gets everything? Maybe someone will put a buoy off the coast with large writing saying “all the oil here belongs to me”?

In cases where property was specifically expropriated from identifiable individuals then by all means return the property to them before any auctions. For the rest, feel free to suggest a better option then auctions… I would be happy to hear what you have to say.

In the future, however, please refrain from questioning my respect for property rights, especially when I specifically agreed that the government does not have a legitimate claim on the land.

Elwood P. Dowd May 6, 2011 at 12:14 am

Anthony,
I question your respect for and committment to property rights because of
statements like: {Who exactly has property rights to “public property”? For
example, who do you think should own the offshore oil reserves? How could they
demonstrate that ownership? I agree that in a free market the issue would be
easy to deal with, but what about the transition? Should the government just
announce “everything we own is up for grabs” and the first person to assert
ownership gets everything? Maybe someone will put a buoy off the coast with
large writing saying “all the oil here belongs to me”?}
And also: {I agree with the principle that the government does not have claim
to the land, but at this point I don’t see any better way to privatize them.}
And finally: {For the rest, feel free to suggest a better option then
auctions… I would be happy to hear what you have to say.}
How curious that you are completely unaware of the process described by
libertarians by which unowned property becomes owned, specifically the concept
of first use. Why is it that you immediately reject the basis of all property
rights as being sufficient to solve the current conundrum. Do you reject first
use? Would not the system that evolved from free individuals voluntarily
interacting with one another over thousands of years be superior to statist
aggression?
First you say the government owns the property then you say they don’t, make
up your mind. Your comments about people putting up signs to “claim” oil
and people getting everything just by “asserting ownership” demonstrates a
complete ignorance of the process of making unowned property owned, the very
basis of property rights. Nobody, not individuals or governments, can establish
property rights by a simple declaration. Property rights are based on first USE.
Before the government was here “everything was up for grabs”, why would it
be a problem to return to that situation?
Why would all land need to be privatized? (I assume that you equate
privatize with private ownership) There has always been unowned land, there
always will be unowned land.
The right to use unowned resources, the right of first use, is inalienable,
if the government can charge people for exercising that inalienable right, then
they ultimately can charge for any other inalienable right.
Lastly, “self-ownership” is a contradiction of all property rights, people
are not property, by their very nature they cannot be owned.
The heretic and poor lost soul, Sy Akhplart

Paul Tenney May 5, 2011 at 11:57 am

I wrote a joke article about this a year ago, but it’s not so ridiculous anymore. Seriously though — time to think like a business! A business has assets and liabilities and both are taken together in looking at the balance sheet. The US has massive assets that I would contend vastly exceed their liabilities! Sell! Sell! Sell! (Or at least lease…)

A Liberal in Lakeview May 5, 2011 at 6:45 pm

But there’s a problem, which Murphy hinted at:

“Over the decades, Congress has always raised the debt ceiling as Uncle Sam’s indebtedness grew.”

The point is that politicians are incorrigibly irresponsible. So, would the proceeds be used to pay down the debt? Of course not. Instead they would be used for some new boondoggle or to expand existing ones. The debt ceiling might, might, cease to grow for a short period of time, but it would continue to increase once again as soon as the politicians had burned through the proceeds.

It’s not hard to figure out that the assets would fall into the hands of organized crime, i.e. businesses that rely upon government patronage, subsidization, and the rigging of commerce to their advantage by the passage of rafts of laws. Of course, the assets are already in the hands of organized crime, but at least in the case of parks they are not being gouged up, bulldozed, etc. just so that some criminal can live luxuriously on large estate or plunder the resources in the usual manner of turbocapitalism.

Suggestions for a massive asset sale are harebrained at best until at least one change has been made. That change is to delete the 2nd clause of Section 8 of Article I. It reads:

“To borrow Money on the credit of the United States;”

Of course, upon deletion of that clause, a crisis becomes immediate. The budget will have to be slashed, or taxes increased immediately (thus assuring a revolt), or some assets sold off. Until abolition of borrowing, asset sales should be resisted.

Patrick Barron May 5, 2011 at 3:07 pm

The Austrian method for getting unused land into private hands is through homesteading. The government did it often in the West. There is no reason that homesteading would not work today.

I like the idea of letting people opt out of Social Security and Medicare. But I would make it a rule that the people who remain may not get revenue from any source other than their respective taxes. Even at age 64, I would opt out of receiving any benefits if the government said that I would not be taxed for Social Security or Medicare and that my general tax dollars would not go to filling these programs’ deficits.

Anthony May 5, 2011 at 11:00 pm

The problem I have with the sudden homesteading of all currently government owned lands is that one or two corporations with inside information from the government could easily claim ALL the land, given advanced notice of the government’s forfeiture. Do you really think that anyone outside of government connected firms would have a shot?As long as the property enters the marketplace then in the end it will work out, but I would rather see an open auction that anyone can participate in then find out that Halliburton got all the oil reserves in the US without paying a cent for it.

Elwood P. Dowd May 9, 2011 at 12:15 am

You criticize the libertarian position by describing a scenario that is illegal under a libertarian system. That our current corrupt government might remain corrupt and give resources to favored corporations is not a valid critique of freedom. You seem more concerned with the possibility that freedom might benefit someone else (halliburton) more than it benefits you. You would rather not see Halliburton get all the oil reserves in the US without paying a cent for it, I would rather not see you get to breath all the air you wanted without paying a cent for it.
The heretic and poor lost soul, Sy Akhplart

Ethan May 6, 2011 at 7:34 am

Apportion it by share ownership, in trust, to each party owed anything by the Old USA; American Indians, those who have payed into social security etc. Divvy the rest up to all citizens and permenant residents as shares of ownership. Default on the national debt and all public service pension obligations etc. No auctions, the government deserves nothing for it’s missmanagement and bureaucrats are I’ll suited to determine who would most efficiently use resources anyway. The bulk of people will sell their shares or enjoy the income they derive, a few will consolidate thier position and leverage the newly privatized assets towards actually raising living standards. When I say divide it ALL up I mean everything, from the monuments to the national parks to the battleships to the 50 miles out of coastline. The federal government can lease office space if need be in the interim before it is completely abolished.

Greshams-law May 7, 2011 at 4:24 am

Great article as always Murphy. Maybe they already are to a small extent: for example, they’re unwinding their $142 billion Mortgage-backed securities portfolio (as announced here). According to the latest daily treasury statement they’ve received around $40 billion from the proceeds of MBS sales so far this year. It makes me wonder what else they’re up to…

T. Doering May 9, 2011 at 12:36 pm

Great Article,
We could sell the the capitol, the white house. cut the pay for all elected politicans to $19,750.00 a year. no expense accounts, no per diem, take away their medical/retirement. have them pay rent for offices say 400 month. fire all the political appointees. fire 2 of 3 govt. employess. It would be easy to fix the debt.

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