WHY GOVERNMENT DOESN'T WORK, by Harry Browne, St. Martin's Press, New York, 1995, ISBN: 0-312-13623-4, 245 pp, $19.95.

Review by Del Meyer, MD

A Note from Harry Browne (Also author of How I Found Freedom in An Unfree World)

Most politicians believe in just one thing - winning elections. They'll say anything to get in office and stay there. Today they believe saying "less government" will get them elected, but the last thing they really want is to give up the power that comes from big government.

No matter which party has held the presidency or dominated Congress, no one has delivered on the promise to reduce government. Despite the talk, every year government grows larger and interferes even further in our lives.

I'm not a politician. Like you, I'm sick of seeing government take almost half the national income and then dole it back to us as though we are children on an allowance. I'm tired of politicians using the crime problem as an excuse for seizing property and liberties from innocent citizens. And I'm not fooled by "welfare reform" that doesn't change anything, or by showy "spending cuts" that add up to a bigger government budget.

As a lifelong libertarian, I'm running for president with a simple platform: We can have higher incomes, safer cities, better schools, and a more civil society if we reduce the size of government drastically - rather than just slowing its growth. This book presents a realistic plan for cutting government, and it shows how you can make me keep my promises if elected.

I don't want to be a politician, I just want our country back. I want to fix America once and for all, so I can live in peace and freedom. If you'll help me, we can get back our freedom, our money, and our lives.

Prologue, the Breakdown of Government (in Harry Browne's own words)

Imagine living in a city where you felt safe walking home at ten in the evening - or even at two in the morning.

Imagine your children going to schools that respect your values; where teachers concentrate on reading, writing, adding, subtracting, and other academic basics; and where no one would dare teach your child a philosophy that's alien to you.

Imagine paying only half the taxes you're paying now. You could move into a better home, finance a more comfortable retirement, send your children to the private school of your choice, support your favorite cause or charity in a way that would make a significant difference, or save up to go into business for yourself.

With much lower taxes, your family could live well on the income of just one spouse - so the other parent could choose to stay home and raise your children in the values you believe, rather than leaving their moral training to strangers.

Is This a Dream?

I'm not describing Utopia. Such a society wouldn't be perfect. But as recently as 1950, it was real. The crime rate was only one fifth of what it is today. Most American school children learned to read, write, and do math competently - and they left school able to make their way in the world. Government was only one-fifth the size it is today. 

Government Running Wild               

But today's America is quite different. It is a land where crime is a national scandal, schools turn out illiterates, and taxes drive both parents into the job market. The "American Dream" has become a mirage for too many of us.

And to make matters worse, government has grown too large and too bold. It routinely tramples on our property and our liberties:

The federal government was founded by men who warned "Don't tread on me." But that government now pries into your bank account, threatens to destroy you to collect its taxes and tries to herd you into a health-care collective - as though you were a Soviet citizen.

Federal, state, and local governments together take 47% of your earnings through direct and hidden taxes - cutting your standard of living to a fraction of what it could be. . .

The government set up to protect private property now confiscates it in the name of fighting drugs or preserving the environment.

The courts that once defended your privacy and liberties now ratify any intrusion that can be shown to be in the government's interest. . .

What Changed?

No plague descended upon America to halt progress and plunge us into a world of violent crime, poor education, and big government.

So how did it happen? What transformed America from the land of the free into the land of high taxes - from the land of prosperity into the land of debt and bankruptcy - from the land of opportunity to the land of quotas and lawsuits - from the land of free enterprise to the land of regulations, mandates, and government inspectors?

The decline of America has been caused by politicians and reformers who believe that you aren't competent to run your own life, that they know better how to spend the money you've earned, that they understand which products you should be allowed to buy and what wages and job benefits are suitable for you.

To run your life for you, they have created a government that fails at everything it undertakes, but wants to undertake everything:

The government can't deliver the mail on time, but wants to take your life in its hands by controlling your health care.

The government can't keep the peace in Washington, D.C. . . .

Government schools don't have the money and time to teach your children how to read well - yet they always find the resources to teach their favorite social theories, no matter how distressing they are to parents.

Wherever we look, government fails at what we want, and succeeds only in finding new ways to interfere with our lives.

What Went Wrong?

Once upon a time government budgets were balanced, our money was sound, the cities were safe, and the taxes of federal, state, and local governments combined took less than 10% of our income. The cost of government has grown. Government has intruded deeper and deeper into our lives, making decisions we used to make for ourselves. Government decides which products we're allowed to buy, sets wage floors that force unemployment on teenagers, prevents most small businesses from raising capital, and stops the critically ill from using life-saving medicines while bureaucrats pretend to protect us.

Wasn't government supposed to be our servant, rather than our master? Wasn't government supposed to help only those who can't help themselves - rather than benefiting politicians, lobbyists, and social reformers?

Where did it all go wrong? What happened to the idea that government should do for the people only what they cannot do for themselves? We need to answer those questions before we can revive the American dream of liberty and prosperity for all.

Part I: Understand the Problem

But to understand how government went so wrong, we must first identify exactly what government is and how it operates. Because Part I does this, it may be the most important section of the book. It shows why government programs never seem to produce the results that were promised - why laws to make America "color blind" lead to racial quotas, why programs to improve the economy end in recession and inflation, and why plans to help the poor enlarge their numbers.

Part II: Identify the Solutions

Part II examines specific issues showing how government created the problems the politicians now pretend they can solve, and showing how we can solve these problems. We will see:

         How crime, education, and welfare went from minor problems in the 1950s to major scandals in the 1990s-and how we can end the scandals.

         How to fix Social Security once and for all - to end its periodic crises, and to guarantee that you get everything you pay for.

         How to balance the federal budget immediately and permanently - without raising taxes. . .  

         How to cut taxes to a fraction of where they are now.

Today's social and political problems aren't mysterious. They can be fixed. If we understand what caused them, we can cure them. And we can make sure they don't recur.

Part II shows how we can get from where we are now to where we want to be - to a society where crime rates are low, education is first-class, taxes are trivial, products and services are plentiful and inexpensive, jobs are more rewarding, and each of us is free to make of his life what he will. . .  We are told that everyone wants a smaller government but that no one wants to give up his own favorite program. Part II will show how we can escape that trap.

A revolution is sweeping through America today - as Americans have grown impatient with big government, high taxes, meddling politicians and bureaucrats, soaring crime rates and mediocre education. America can be free, peaceful and prosperous again.

Government's Unique Asset

The distinctive feature of government is coercion - the use of force and the threat of force to win obedience. This is how government differs from every other agency in society. The others persuade; government compels.

When someone demands that government help flood victims, he is saying he wants to force people to pay for flood relief. Otherwise, he'd be happy to have the Red Cross and its supporters handle everything. . .

When Congress passes a bill mandating "family leave, it forces every employer to provide time off for family problems - even if its employees want the employer to use payroll money for some other benefit. Otherwise, employers and employees would be free to decide what works best in each situation.

         The government forces someone to pay for something;

         The government forces someone to do something; or

         The government forcibly prevents someone from doing something.

There is no other reason to involve government. And by "force" I mean the real thing - the kind that hurts people . . .  Every government program, no matter how benign it may appear, is the same. Coercion is the reason - and the only reason - it is a government program. . .

People seek the help of business groups, charity organizations, and service clubs to urge others to support some cause. People turn to government to force others to support their cause.

Government Defined: An agency of coercion.

Of course, there are other agencies of coercion - such as the Mafia. So to be more precise, government is the agency of coercion that has flags in front of its offices.

Why Government Programs Always Go Astray

Because of government's power, controlling it is the grand prize - the brass ring, the pot of gold, the genie of the lamp. It beckons as the shortcut to riches, to the perfect world you imagine, to imposing your personal tastes on everyone. With government at your disposal, it appears that you can bypass the tedious process of earning a living, spreading the gospel, or persuading others that you're right.

No wonder that most TV news revolves around government. No wonder nearly everyone wants to influence government. Whoever controls it controls us all.


Medicare provides a good example. It was created in 1965 to make it easier for the elderly to get health care. But by reducing the patient's out-of-pocket costs, it increased the demand for doctors and hospitals. And it reduced the supply of those services by requiring doctors and other medical personnel to use their time and attention handling paperwork and complying with regulations - and looking for ways to circumvent these things. So, the price of medical care rose sharply as the demand soared and the supply diminished.

As a result, the elderly now pay from their own pockets over twice as much for health care (after adjusting for inflation) than they did before Medicare began. And most of the elderly now find it harder to get adequate medical service. Naturally, the government points to the higher costs and shortages as proof that the elderly would be lost without Medicare - and that government should be even more deeply involved.

When Medicare was set up in 1965, the politicians projected its cost in 1990 to be $3 billion - which is equivalent to $12 billion when adjusted for inflation to 1990 dollars. The actual cost in 1990 was $98 billion - eight times as much.

Upside-Down Results

         Poverty programs don't reduce the number of poor people. On the contrary, they encourage more people to qualify as poor and get on the gravy train.

         Rules and regulations don't reform society as expected. People respond by looking for ways around the rules they don't like.

         The War on Drugs makes drugs more profitable - increasing the incentive for drug pushers to recruit new customers.

         The underground economy thrives as a means of earning money without losing it to government - reducing the revenues that had been expected to pay for government programs.

Human action is always unpredictable. But you can count on government programs to produce results quite different from those promised by their sponsors. You would think this would cause people to shun government as a way of solving problems. But just the opposite happens - as we'll see.

Why Government Grows & Grows & Grows

The bad consequences of a government program usually don't show up immediately. And the delay may be long enough to hide the connection between the program and its results. So government never has to say it's sorry - never has to take responsibility for the misery it causes. Instead, it can blame everything on personal greed, profit-hungry corporations, and the "private" sector. And the government's cure for the problems is to impose bigger programs, more regulation, and higher taxes. Thus politicians tell us the high cost of Medicare is due to doctors, hospitals, and drug companies charging too much - not that Medicare inflated costs by running up the demand for health care and hindering the supply of it. And, even though government controls over 50% of the money spent on medical care, politicians freely refer to the high cost of a hospital stay as a failure of the free market.

Each government program carries within it the seeds of future programs that will be "needed" to clean up the mess the first program creates. No matter how much mischief it causes, government always shows up in a cavalry uniform - riding in to rescue us from the problems it created.

         Government regulates drug companies into near paralysis - and then spends billions of our dollars to subsidize drug research.

         Government cripples American companies with punitive taxes and mountains of regulation - and then spends billions of our dollars trying to find foreign markets for those crippled companies.

         By preventing people and companies from taking care of themselves, government feeds its own growth.

         Government grows, too, because the subsidy given to one group inspires others to demand the same benefits. And when government protects one company or industry from competition, others wonder why they shouldn't demand the same protection.

Everyone who comes to the government asking for favors has a plausible request.

Once it's considered proper to use government force to solve one person's problem, force can be justified to solve anyone's problem.

Over time, fewer and fewer requests seem out of bounds. And the grounds for saying "no" become more and more eroded. The pressure on politicians to use coercion to grant favors becomes overwhelming.

The Motives of Public Servants

Lawmakers, bureaucrats, and judges all rejoice in a government that grows and grows and grows. Big government gives lawmakers the power to make or break companies and individuals. People must bow and scrape to obtain favors - or just to keep government from destroying them.

Heath Care - The Problem

The road to Hell is paved with good intentions, the road to big government is paved with small steps - each of which seems harmless in itself.

The pattern rarely changes.

1. There is widespread publicity about a crisis.
2. Politicians float a drastic proposal to solve the problem with new, far-reaching, bureaucratic program.
3. "Moderates" in Congress and the public mount opposition to the government takeover.
4. Eventually, the politicians arrive at a compromise - to fix the problem without radical overhaul.
5. Although the moderates congratulate themselves on holding the line against big government, the compromise makes government bigger, more powerful, and more damaging - making the next crisis inevitable.

Because politicians refuse to recognize that government doesn't work, they never blame the current problem on the program they passed earlier. Instead, while professing their undying faith in free enterprise, they note regretfully that the market has failed to work in this instance. So they propose to fix it with a larger, more bureaucratic system - and the cycle continues with a compromise, more government, more damage and another proposal.

Health care is an excellent example. From the passage of Medicare in 1965 to a health-care system run completely by the government a few years from now, the politicians have led us along step by innocuous step. Although each step has been presented as the end of the journey, each has added to the problem and made the next step seem necessary.

To read the 18 ways the state of your health, the quality of medical service you receive, and the price you pay are affected by federal or state government interference, please see the book section of Dr. Government.

Heath Care - The Solution

In the health-care debate of 1992-1994, words like compassion, right, need, and fairness showed up frequently. But a number of relevant words were ignored.

For example, I never heard the words force or coercion in public discussion about the issue. And yet the Health Security Act, the President's 1993 proposal for universal health insurance, had a great deal to do with force. There are some revealing terms in the proposal - such as prison (which shows up 7 times), penalty (111 times), fine (6), enforce (83), prohibit (47), mandatory (24), limit (231), obligation (51), require (901), and so on. For example, a person withholding information about his medical history could go to prison for five years.

That was the Democrats' proposal. But lest you think the Republicans don't believe in forcing people to do the right thing, their principal proposal included the terms prison (1 time), enforce (37), penalty (64), fine (12), prohibit (19), and require (482).

Even the plan publicized as the most "free market" of the eight major proposals contains the words penalty (5 times), prohibit (5), require (54), enforce (1), and so on.

But coercion is nothing new in government-run health care. Medicare already has plenty of fines and penalties. For example, a Doctor is fined merely for filing the wrong form - or failing to file a form for every visit by a patient.

Is It Compassion or Force?

Browne continues with the welfare problems, social security problems, and how neither of the two parties will save us. Please go to the remainder of part two for an analysis of the problems and solutions.  www.amazon.com/Government-Doesnt-Work-Harry-Browne/dp/0965603601


In the Epilogue, he gives us a message of hope. For America's first 150 years, force was minimized in social relationships. During the past 60 years, government coercion has become the standard device for settling social questions. Today everything is a political issue - to be decided by the strongest faction at the expense of everyone else. Today political might makes right. The result is an America our grandparents wouldn't recognize.

         Instead of compassion and charity, we have welfare rights.

         Instead of education, we have schools with metal detectors, drug pushers, social indoctrination, and kids who can't read their own diplomas.

         Instead of safety, we have doors with multiple locks.

         Instead of civility, we have groups jostling to gain entitlements to the earnings of others.

While private companies have been producing dazzling progress in computers, electronics, pharmaceuticals, and many other areas, everything in the social order has deteriorated. Our public institutions are a wreck. To correct this, we don't have to turn back the clock. We only have to turn away from government - from the idea that we can cure social problems with a gun, from the fairy-tale belief that government can be made to work for anyone but the politicians. Coercion will never be as effective as freedom and cooperation.

Government doesn't work. It is time to stop trying to fix it, and start finding ways to live with as little of it as possible.

Browne closes with a final hope for people of every persuasion - from the young to the elderly, from the minorities to people on welfare, from government employees to reformers, to people of every religion. No one should feel threatened, except maybe the politicians. It's a three-page tour de force on how to get government out of the way. The purchase price is a pittance for those interested in the future of our country and making America free again.



The late Harry Browne is the author of numerous financial books, including three New York Times bestsellers: How You Can Profit from the Coming Devaluation, You Can Profit from a Monetary Crisis, and New Profits from the Monetary Crisis. His book How I Found Freedom in An Unfree World, published in 1973, is a modem classic. He lived with his wife, Pamela, in Tennessee until his death. To visit his Library Museum . . .