Following up on the previous post, let’s start with what is a fact, i.e. something objective that cannot be negated. Well, the fact is that in order to satisfy the MAJORITY of one’s life needs, every person needs GOODS, and SOMETIMES also PERSONAL BENEFITS from other people, which are called a FAVOUR when rendered gratuitously, and – a SERVICE when rendered NOT FOR FREE. The goods and services that serve this purpose are called PRIVATE GOODS AND SERVICES here. They are always created IN THE PRIVATE SECTOR, and since the advent of money and the market, they have been subject to FREE AND MUTUAL EXCHANGE. Thanks to this – as I have argued in the first two posts of this blog (available here, and here) – EVERY PARTICIPANT of this market enjoys the personal benefit of saving a certain portion of his own effort, which he would have to put in ADDITIONALLY if what he receives from the counterparty he wanted to acquire through his own efforts (by his own means).
The principle of voluntariness and reciprocity of market exchange as a means of acquiring PRIVATE GOODS AND SERVICES applies to all people except THOSE IN POWER. These people are part of the PUBLIC SECTOR in the sense defined previously, and their activities IN THE PUBLIC SPACE serve – at least in theory – the BENEFIT OF THE PUBLIC subjected to their authority. Thus, it is understandable that the satisfaction of the rulers’ life needs, that is, their needs IN THE PRIVATE SPACE, must be taken care of by the ruled. And this is what some PART of the obligatory PUBLIC TRIBUTES serve. In the past, these tributes were paid in kind, i.e., in specific goods and specific services, and in modern times – mainly in the form of taxes paid in cash. The size of these tributes is, of course, decided by those in power, with, as the English say, the sky is the limit. I think that this fact is not irrelevant to the people being ruled.
However, leaving aside the magnitude of these obligations, it is worth noting that at the time these tributes were collected IN KIND, no one doubted that the goods came from those who produced or grew them. The same was true of services; they had to be performed by those who provided them. In short, there can be no doubt that the obligation to deliver public tributes in this form was then incumbent on those whom we refer to here as SUPPLIERS OF PRIVATE GOODS AND SERVICES.
In addition to goods and services for the satisfaction of personal needs, those in power – as you already know – also need goods and services necessary for the exercise of power, i.e. PUBLIC GOODS AND SERVICES. These include, to remind you, the services of all those employed in public sector institutions, as well as the services of external suppliers (experts, advisors, etc.), all kinds of uniformed, customs and fiscal services, as well as such goods as equipment for the military and other services, computer programs (for example, the famous Pegasus) and many others, none of which, as has also already been mentioned here, are NEEDED by ANYONE IN THE PRIVATE SPHERE.
And here we come to the crux of the matter. All PRIVATE GOODS AND SERVICES PROVIDERS, whether employees of public institutions or business owners, do what they do for the sole purpose of “earning a living,” that is, for the purpose of acquiring the PRIVATE GOODS AND SERVICES needed to satisfy their HUMAN NEEDS. The purpose of their activity is therefore exactly the same as that of all other people in the private sector. However, due to the fact that the results of their work are not needed by anyone IN THE PRIVATE SECTOR, none of them would have a chance to exchange them for PRIVATE GOODS AND SERVICES through a VOLUNTARY AND MUTUAL market exchange.
To see this, just imagine for a moment that, for some reason, money has disappeared and all transactions in the market are carried out by way of DIRECT EXCHANGE: commodity A for commodity B. Leaving aside the technical and organizational difficulties that caused the barter system to essentially NEVER be used on a larger scale, it is worth asking who, under such conditions, would be willing to voluntarily accept, for example, an anti-tank mine or the service of a prison guard as payment for a piece of pork loin or for a loaf of bread? Of course, I am bringing the thing to an absurdity here, but only to sharpen the problem at hand.
Under such conditions (without money), what would the rulers (the PUBLIC SECTOR) have to do to secure the supply of the anti-tank mines or the services of prison guards used in the example, and all the other PUBLIC GOODS AND SERVICES necessary for the exercise of power? The only logical answer – assuming that people create and offer public goods and services VOLUNTARILY and offer them to the public sector on an market basis (MUTUALITY OF BENEFITS) – is to provide them with so much and such PRIVATE GOODS that they are willing to be providers of PUBLIC GOODS AND SERVICES in exchange for those goods. Otherwise, their activities in this role would make no sense and no one would want to undertake them.
Thus, to that part of the PRIVATE GOODS AND SERVICES that the rulers collect forcibly and gratuitously from their PRODUCERS to satisfy their PRIVATE needs, they must add a SECOND PART, which is used to “pay” the SUPPLIERS of PUBLIC GOODS AND SERVICES. And so it was in the days when public tributes in kind prevailed. In addition to goods for himself and his family, the ruler had to have ADDITIONALLY goods for the upkeep of all the court servants, palace guards, slaves, soldiers and everyone else performing any task for him. And who but the producers of these goods and services MIGHT have – and had to – provide them?
That this was indeed the case is evidenced by hundreds of articles and historical books based on source documents, which describe the various systems of public tributes and how they were collected and used in ancient times in various countries of the world. So there is no point in considering them here. The only important thing is that THAT’S WHAT IT REALLY WAS. And what is important is WHAT IS THE IMPLICATION OF THAT.
And it follows exactly what was stated previously in the form of the thesis that the state – understood here as the entire state apparatus, i.e., THE PEOPLE EXERCISING THE AUTHORITY AND ALL THOSE WHO SERVE THAT AUTHORITY in whatever role – is maintained solely by people operating IN THE SECTOR OF PRODUCTION AND EXCHANGE OF PRIVATE GOODS AND SERVICES.
It is said that one picture is worth a thousand words. Thus, if only the following picture remains in memory from this text, I will consider my task completed.
However, this does not mean that the matter is over. Other related issues will be discussed next.
Source of original picture: MAN_Atlante_fronte_1040572.JPG (2112×2816) (wikimedia.org)
