Will Trump’s Plan to Drain the Swamp Leave DC High and Dry?
People in Washington, D.C. are worried. Officials in the seat of the federal government have begun to express concern that President Trump’s promise to “drain the swamp” by reducing the federal workforce. There are fears Trump’s plans to cut government spending will harm the city’s economy, increase unemployment, and generally puncture what has historically been a recession-proof bubble of economic activity.
Are they right to be worried? Well, yes and no. Assuming that Trump actually does follow through on his plans to reduce the federal workforce, some people will lose their jobs. Some will move out of the District, and others may even go on public assistance while they look for new sources of income. It will be a rocky road for some government employees, and this disruption will ripple over, at least temporarily, into other industries.
But that does not mean that draining the swamp will be a bad thing, or that it will have a net negative effect on the economy. In fact, we should expect just the opposite. The reason is that government jobs differ from private sector jobs in a fundamental way. In order for a job to exist in the private sector, it must produce something that people value. If a worker is not earning his employer more in revenue than he is costing in wages, the employer can boost profits by firing him. There are undoubtedly some bad businessmen who employ unproductive employees by mistake, but ultimately they will suffer for their ineptitude, and poorly managed businesses will perish as better ones take their place.
Not so with the government. The government worker collects a salary that is forcibly seized from the taxpayers. He needs not generate a profit, satisfy consumer demand, or produce anything of value at all. All he has to do is remain unnoticed by his superiors and he gets to keep collecting a paycheck at the public’s expense.
If these people lose their jobs, their labor will be freed up to engage in more productive pursuits that can actually contribute to society instead of leeching off of it. To understand this, imagine a whole city where everyone is employed digging holes and filling them back in again. If we eliminated all of those jobs, the temporary unemployment would be a hardship for the workers themselves. The resources devoted to the useless activity of hole-digging, however, could be put towards something useful instead, and the workers could devote their talents towards helping their fellow man. It would be indisputable that such a reallocation would be beneficial, in the long run at least. The reallocation that comes from draining the swamp would be comparably desirable.
The great French economist Frederic Bastiat illustrated this phenomenon with what is known as the “Broken Window Fallacy.” The fallacy holds that breaking windows is good for the economy because it provides work for glassmakers. What Bastiat realized was that a society not forced to constantly repair broken windows is free to exert its efforts in other directions. That way we can enjoy the benefit of functioning windows, but also of everything else that extra labor can produce. While bureaucrats in Washington, D.C. aren’t actively breaking windows, they might as well be, for all the harm they cause with overregulation, excessive taxation, and general interference with American economic activity. Ultimately, their loss, in the words of W.S. Gilbert, will be a distinct gain to society at large. (For more from the author of “Will Trump’s Plan to Drain the Swamp Leave DC High and Dry?” please click HERE)
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