This government doesn’t merely breed corruption. It is corruption.

Sheldon Richman describes the ultimate end of the state/government in today's Freeman. As I read this analysis I couldn't help but think of the Schlesinger article on Heroic Leadership - labeled a doctrine that was despicable by a fellow blogger. The expansion of the state and metastasizing government that follows inevitably lead to corruption.

I spend my summers in Bisbee, a small community along the Arizona/Mexico border. Near Bisbee is the town of Douglas, Arizona which was named one of the 10 most corrupt communities some years ago. I was told by a year round resident that 90 per cent of the income earned in Douglas was from the underground economy. The reasons for this are clear - Douglas is an international port of entry from the US to Mexico and back, there are two major Border Patrol facilities along the border near Douglas from which some 1000 agents do their work to fight the war on immmigration, there are a number of major government facilities in the area to fight the war on drugs, eastern Cochise County is low income so the layers of government in and around Douglas are fighting the war on poverty, the level of educational attainment in the area is low so other layers of government are fighting the war on illiteracy, . . .

With all these wars going on there is amble opportunity for collateral damage - the subject of another post. What is apparent is that with such a dominant state presence in Cochise Co. - in addition to the government units engaged in the wars above - Bisbee is the county seat, the State is manifest in office of postal delivery, primary, secondary and post secondary education, incarceration, etc . . . - there is clearly opportunity for entrepreneurial activity. I am thinking of the distinction that William Baumol and Ben Powell(Chapters 3 by Holcombe and 4 by Baumol) make in terms of wealth creating entrepreneurial activity that responds to incentives from the market (positive sum exchange is the inevitable outcome of the voluntary exchange) and wealth destroying entrepreneurial activity that responds to the incentives of the state (negative sum inevitably results from involuntary exchange).

Richman's humorous reference to Captain Renault in Casablanca captures the sad absurdity - I am shocked, shocked that there is corruption in a state dominated, welfare society.