The Optimum (largest) Size of Government

Is there a "virus" in the democratic system that will, over the course of centuries, bring about its collapse? People worry that government unchecked will grow larger and larger. It is human nature:

• Legislators can only add Programs. They find much less public resistance to adding a small new government program than removing one. Removing one brings out all the opposition that would be affected by the loss.
• Administrators at all levels try to grow their empire. After all, their day is full, if they want to do more, they have to add people. If they want to become powerful, they need to add people.
• Inefficiency creeps in, requiring further growth to overcome the loss in productivity. There is no competitor.
• Federal governments find new ways of cleverly financing its growth. The financial insolvency of Greece is just one example that until recently was hidden from view.
• The recent downturn shows that state governments are virtually incapable of downsizing even in fiscal crisis. Their answer? Borrow more and tax more.

But they can't grow and tax indefinitely. Today, the average taxpayer pays all the income from January to some date in May to the government. The rest they keep. But the date in May keeps moving out as the gov gobbles up a little more. If government spending were to suddently double, we would have to pay from January through October in taxes. That would not be possible, because we'd no longer be able to buy food or housing. The motivation to work would disappear for many as we'd be better off with odd-jobs or welfare. The tax base would disappear.

No, they couldn't tax us through any date close to December. It might be June-ish that society would start to collapse. So that June-ish date sets the maximum size (or in engineering terms, the optimum operating point) for government.

There is a way to increase the maximum size even more: A government bent on growing itself and hitting the limits of what society can bear can privatize an industry. That's right, it can take it over, set prices and absorb profits. As time goes on, it can privatize other industries to feed its appetite. But then the efficiency problem appears again and the industries don't peform as well as when there was competition. They atrophy and start to shrink.

Eventually, we get back to the question, can government consciously downsize for the betterment of everybody? If not, it will either collapse under its own weight or hover on the brink of bankruptcy indefinitely, unable to shrink and solve its problems. Of course, that would be a very unpleasant for the life of its citizens and it would be that way for a very long time.

So it becomes a very important question: Are we able to shrink government before it is necessary? The rewards are great, since every person that moves from a government job to a private one produces something useful which benefits themself and someone in that society. Their lack of being a burden on government payrolls benefits all of society.

All of which reveals that there is indeed another optimum: A government so small that taxes are much less, yet solvency is assured, wealth of citizens is much greater, yet the gov is large enough to do the tasks that are essential to its people; police, fire, military, enforcement of regulations, etc. The rewards are great if we can do it - an almost unimaginable amount of money. Perhaps the Internet Age will empower us.