THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Sunday, January 1, 1995 TAG: 9412290357
SECTION: COMMENTARY PAGE: J1 EDITION: FINAL
SOURCE: BY ALEX MARSHALL, STAFF WRITER
LENGTH: Medium: 91 lines
I just bought a house. It provided me with a graphic description of the power of government in our lives. Or, you might say, the power of government to make our lives possible. Or maybe both.
The biggest jolt came when the Feds raised the interest rate three-quarters of a point in November. I called our mortgage banker and practically screamed over the phone, ``We're locked in, right?''
``Yeah,'' he said, ``You're locked in. Don't worry.''
After I hung up, I pondered the power of these suited officials in some big building somewhere in Washington. With one decision, they almost raised our house payments a sheaf of bills each month. They did raise them for millions of future home buyers all around the country. That's power.
I've had some thoughts lately on the nature of government in our lives. The usual thought, especially among conservatives, is that the capitalist system, with the free market, sort of works by itself. It's governed by ``laws,'' like the Law of Supply and Demand, which are somehow ``natural'' - like the Law of Gravity.
In this view, government is kind of like an appendage, even a parasite, feeding off the free market. Perhaps it does necessary things - pick up the trash, defend the country. But its means of existence - taxes - comes from taking a share of the money the free market generates.
Free market - good. Government - bad. That's the pared-down version of this conservative philosophy.
The new Republican majority and its leaders advance this view. It's pretty close to one I used to hold. What's that slogan of Rep. Newt Gingrich? Or is it Sen. Phil Gramm? That the American people know how to spend their dollars better than the federal government does.
But I'm starting to have another view of government. It's one I've been thinking up as I ponder things like home closings. In this view, the wages we earn, the homes and appliances we buy, depend on government, not the other way around.
Now this might sound absurd at first. But consider: Who prints the money that people earn and reluctantly surrender to the federal, state and local governments? Who regulates the money supply and interest rates, and so keeps that money valuable? On an even more basic level, who records the deeds and contracts that prove somebody owns something in the first place?
Answer: Government.
If you think about it, you'll realize that government provides virtually every essential thing that makes the ``free-market'' system work. A money supply. A central bank. Roads. A court system. A police force.
The free market isn't free. It's paid for through the creation of these institutions that make the whole thing go. A billion-dollar corporation doesn't exist other than in the records in some city hall or corporation commission that ``proves'' its existence.
As Russia is finding out, setting up the institutions that make the ``free'' market work is actually an enormous undertaking.
I remember the first time I walked around the records room at City Hall in Virginia Beach. As I looked up land sales on the computer or in big dusty page books, I realized I was seeing the chipped and weathered columns of the system that created the businesses and homes around me. By comparison, the decisions the City Council made in the big room across the street were mere window-dressings, of bare significance.
The capitalist system is basically a game we all agreed, at birth I guess, to play. Government makes the rules. We can change the rules by changing the government.
Of course, this game has unusual byproducts. Example: We bought title insurance on our new house. That's in case someone a few years from now comes along and says, ``I bought for a dollar the rights to an old corporation that owned this land a hundred years ago. Therefore, I now own your house.''
Now, from any objective viewpoint, someone owns a house because they paid a lot of hard-earned money for it, at the going market rate. But under the game, those dusty or computerized records at City Hall determine all. We respect them, pay homage to them, whatever their effect on flesh and blood.
Is all this important? I believe it is because how we view our government affects how we view ourselves. If we realized the essentially illusionary nature of the game we play, we might respect more, and take more of a part in, the body that sets the rules and keeps it all running.
It doesn't mean there should be big government. As an institution, government can foul up the game it has created if it makes the rules too complicated. But certainly, ethically, it has the right to do so.
We might also respect more the capitalist system. Not as something ``natural.'' But as an invention of mankind that has created enormous wealth. But we also should remember that another invention of man made it possible: Government. ILLUSTRATION: Color photo
Alex Marshall
by CNB