Golden Transcript, February 6, 1992

Socializing property threatens America
By Dennis Polhill
Golden resident

Socialism is disintegrating all over the world. Centrally controlled command economies do not work. Only a free-market economy can deliver goods of adequate quantity and qualify at the right time to suit the fickle demands of the consumer. Yet, with all of the world so solidly convinced and struggling so desperately to emulate America, only America in the world community of countries continues to grow its government and is doing so at a staggering pace of four times faster than national economic growth rate.

Many Americans are aware of the trend and the ultimate consequences if not controlled. The result of this mood is the adoption of various tax-limitation and spending-limitation measures and an increasing unwillingness of taxpayers to approve new taxes or increases in tax rates even when the proposed public project is worthy. Unfortunately, with over 80,000 governments in America and over 2,000 in Colorado, controlling this many-headed dragon is not so simple. Government is continuing to grow beyond what is reflected on your tax bill first with increasing amounts of public debt and secondly by venturing into free markets to compete with private businesses for their customers.

“Follow the money.”

The public supplier and private supplier are both making available the same product or service to the customer. The government sector is all governments that we all pay taxes to for the services we expect and enjoy: police protection, fire protection, schools, water, sewer, streets, etc., etc.

If a public sector supplier operates with the same level of management intensity and entrepreneurial initiative as the private supplier, the product will appear on the market at about 67 percent of price of the private supplier. The 33 percent difference is a rough estimate of the benefit of not having to pay any taxes. When the taxes are not paid the government sector is deprived of needed revenue. The result is that the shortage of tax revenue is accommodated by an increase in the tax rate. The additional tax is paid by, you guessed it, the consumer.

The consumer’s duty is to acquire the best product at the least price. If both products are the same, the consumer’s purchasing decision is simplified to selecting the product of least expense. The consumer will purchase from the public sector supplier. One by one the customers gravitate to the lower-priced public supplier. Eventually the private supplier will lose a sufficient number of his customers that he will be forced to close.

People in private business call this “unfair competition.”

Really that name is too polite. If your business is the private business that the government decides to compete with, you are at risk of losing everything: your business, your job, your income, your savings, your credit, your reputation, and possibly more: your home, your family. A more accurate label would be “tyrannical, abusive and socialistic subversion of free enterprise at the expense of hard working and patriotic businesses.” The common good does not make this form of public policy legitimate. It is discriminatory, un-American, and socialistic all in the same breath.

The extent of the problem is greater than one would imagine.
Most people are aware of the aggressive advances being made by cities, counties and districts into the athletic club and day-care industries. Some less visible examples are catering, ambulance services, dental services, janitorial supplies, laboratory testing services, geological consulting services, golf courses, miniature golf courses, hotels, underground storage tank testing, cement manufacturing, fish farms, Christmas tree sales, greenhouses, hearing aids, fire safety suit manufacturing, forest-fire-fighting equipment, office leasing, asphalt concrete manufacturing, pavement deflection testing, veterinarian services, book stores, computer sales.

During October and November of 1991 a group of nearly 300 business owners from all over Colorado met to determine the top 10 business issues of Colorado. The effort was initiated through the vision of Gov. Roy Romer and the cooperation of the entire state Legislature. All of them appointed voting delegates to the Governor’s Statehouse Conference on Small Business. These 300 business leaders of Colorado voted the issue of government competition as the second-most pressing issue facing businesses in Colorado. Legislation will be introduced during January and it is expected that this and the other nine important business issues will all become law this year.