The Three Types of Governments

By Charley Hooper

Governments that defend our rights to not be abused by others are Superman governments. Godzilla governments have bad intentions and hurt people. Govzilla governments have good intentions, but still hurt people.

Nazi Germany is a recurrent example of a Godzilla government. That government's goal was to hurt people and it succeeded marvelously. Boo! Hiss!

I described another type of Godzilla government that has good intentions and tries to help people but ends up clumsily hurting them. We will call this a "Govzilla" government to distinguish it from Godzilla. Godzilla has bad intentions; Govzilla has good intentions.

Let's discuss a concrete example of a Govzilla policy.

How many of you are facing foreclosure or know someone who is? Foreclosure is dreadful and you'd have to be a cold-hearted person not to sympathize with these people. Enter our Govzilla government, which is trying to help these homeowners by changing the rules and allowing them to pay less but still stay in their homes. Who is helped? Mortgage defaulters, of course. But not everyone is happy.

By rewriting the terms of the mortgages--by breaking a contract that two parties had voluntarily and peacefully entered into--the government hurts someone else: mortgage lenders. And, yes, these are real people, too. Real people work at these companies and real people invest in them as stockholders. Money is taken from their pockets as surely as through a mugging. Now people will be afraid to invest in bank and mortgage company stocks because of this risk and the stock market will slump.

With Obama's $75 billion mortgage modification program, taxpayers, who have earned their money peacefully and honestly, are now required to pay $75 billion for someone else's mistakes and bad fortune. If the homes of these defaulters had appreciated in value, they certainly would have kept the windfall. Since they depreciated, somehow we're on the hook? Future homebuyers, seeing this, will be less careful because Uncle Sam will be there to bail them out. After all, heads they win, tails we lose.

But there's yet another problem: The next time these people go to buy a house and ask for a loan, their "promise" to pay will be doubted--after all, they might ask for another loan restructuring--and so they won't get that loan and they won't get that house. And we, ourselves, might not get the loan we want because a bank will think that we will borrow that strategy. So loans will be more difficult to acquire and fewer people will afford a house and the housing market will slump.

We should ask how much the people who were supposedly "helped" were really helped. They might be in a house they still can't afford and they might yet default, as many have done. More than a third of the 1.24 million borrowers who enrolled in Obama's mortgage modification program have already failed to make their payments and more than half are expected to fail eventually. We are essentially paying to delay the inevitable. But it's worse than that. These homeowners have learned to rely less on their own ability to get out of a tight situation and instead to run off to plead their case to some politician.

And now that problems are solved in the political realm instead of the private realm, everyone will have to hire lobbyists and contribute to their favored politicians, which increases the costs of elections to the point where only the incumbents and the rich have a shot. And the government gets more and more power and becomes more and more entrenched.

From the wish to help some people, all these bad things pile up.

It is an ironclad fact that it is impossible for the government to help anyone in such a manner without hurting someone else. The government turns into that very thing that we wanted the government to protect us against in the first place, destroying our wealth, our freedoms, and our spirit. The road to hell is paved with good intentions. Well, the road to a destructive government can be paved just as easily by pleasant people preventing hardship as by dangerously dysfunctional dictators.

Let's stop this Govzilla madness and restore our Superman government.