All right, years ago, I ran this idea past somebody who told me it would be unconstitutional, but I didn’t quiet understand his reasoning (I don’t remember what he said, it’s been so long).
OK, here’s my idea. Why couldn’t government start corporations…I’m not talking socialism here where they take over private corporations, I’m talking about starting corporations to compete with private corporations. The profits would go to fund government so that income and other kinds of taxes could be reduced or eliminated.
Now the government owned corporations would have to play by the same rules as private corporations. In fact, to keep the government from getting too powerful, maybe they could have a few extra restrictions placed on them.
Anyway, there you go. Almost approaching socialism, except that government corporations would compete with private corporations. But since people might worry about the government corporations buying up other corporations Tyco style, thus, in effect, achieving socialism, then maybe acquisition limitations could be placed on the government corporations.
OK, I’m done babbling now. Now it’s time for you to tear my idea to shreds, like I know you’ll do 
.
There are lots of government corporations. Amtrak is one, the USPS is another. The Port Authority of New York and New Jersey is operated by those two states, and often turns a profit. Most of the time government corporations are monopolies set up because the private sector is (or is believed by government people to be) unwilling or unable to do some essential task.
However, it makes little sense to start government corporations to compete directly with private industry just to fund government. Given that markets are finite, it’s just a lot easier to let other people start the corporations and tax them anyway.
And of course, it opens a whole bag o’worms of ethical debate about why and if the gummint should be competing with private industry.
You also get into the issue that the government is in charge of making and enforcing the rules that would make it play fair. Let’s just say that this is at least as unlikely to work as, say, selling off the anti-monopoly part of the Justice Department to Microsoft.
Well all I know is that state prisons used to manufacture items that the states themselves would use (for instance furniture). Private corporations raised hell saying that they were being subjected to unfair competition. So today the prisons don’t even make license plates. So your idea was used in a limited way and still didn’t go over.
Well aside from the fact that the Federal government already operates several corporations and has for quite a while, you’ve got a good idea.
The United States Postal Service is a corporation and it competes against UPS, FedEx and others.
The Tennesse Valley Authority has been in competition with other utility companies.
In theory, you could go back to the First Bank of the US to find a government corporation that was in competition with private interests.
In practice, it would reduce the government’s income. Even in an ideal world, it would make no difference.
In practice, politicians and civil servants do not allocate resources as efficiently as the private sector in a free market, so government investments would yield lower returns (eg, some politician would insist that a government factory be situated in his district rather than in one where it made more commercial sense).
Even in an ideal world where this did not happen, government industry would simply drive out the private sector, who would generate less tax.
Is it my imagination or is this thread duplicated?
The duplicate threads have now been merged.
The formation of government ‘for-profit’ corporations is illegal/unconstitutional, for starters. While such corporations do exist and have for some generations, their existence does NOT make them legal or constitutional.
More to the OP’s point, though, “government ‘for-profit’ corporation” is an oxymoron along the lines of “political integrity” and “congressional restraint.” Over the past two centuries, our government has – gradually – gathered the power to tax us pretty much without limit. That power completely erases any motivation for the government to turn a profit at anything it does. Why bother to increase ‘profits’ by improving products and services or by cutting costs when all you have to do is go to the customers and take as much of their money as you want?
In any case, government in general is poorly suited to operate any sort of commercial enterprise. If I were to start my own common carrier business here in Ohio, for example, I think I’d take into consideration that it would cost me a helluva lot more to deliver a given parcel to my uncle in California than it would to deliver same to my next-door neighbor, and I’d charge my customers accordingly. The USPS, however, seems not to have picked up on this.
The Tennessee Valley Authority is another example of the consistent failure of government to conduct good business. Were the TVA a private venture, it would have been sold or gone out of business decades ago. But instead, after nearly seventy years of mismanagement, waste and scandal, the TVA is still selling electricity – at the highest rates in the southeastern U.S.
True, mere existence does not make something constitutional, but neither does a simple assertion make something unconstitutional.
What provisions of the U.S. Constitution are you relying on in support of your statement?
www.unicor.gov, the prison industry for the U.S. federal government. Very much in business. In many cases, federal agencies HAVE to buy from Unicor if they make the general type of product for which you’re looking.
This is a bad idea from any point of view. To begin with you would have huge conflict of interest when the government is regulating an industry in which it is a participant. That is pretty much what happened in communist countries. The government decides to set up a nuclear power plant. To make things easier for itself safety precautions, environmental issues, etc are put aside. All in the name of “the people”. The result is Chernobyl.
The Chinese Army owned a lot of industry to raise money for itself. The result was they were lousy in business and they were lousy as an army. The government has its role and things go better when it limits itself to that role.
In Texas the prisoners still make highway signs, office furniture, license plates and soap, among other things.
You make a good point. I guess there could be conflict of interest there. Although it seems that Senators going before fellow Senators on an ethics commity for ethics violations seems to also be like the fox garding the hen house. But they do it anyway. But I know, I know, just because they do it, doesn’t mean it’s right.
Yeah, that’s right, I remember that. Bunch of cry babies. :rolleyes:
You and others keep mentioning USPS. That’s not really in competition with UPS, FedEx or anybody else, in the fact that, yeah, the compete when it comes to delivering packages, but as for mail and stamps, the USPS is monopoly. Why do you think in a world where, when businesses need to attract more customers, they lower prices, but with the Post Office, stamp prices keep going up.
I think you’re looking at it backwards, Piper. The U.S. Constitution was very specifically designed to limit the powers of the central (federal) government. There is language there – and I paraphrase a bit – such that all powers not given to the government herein are reserved to the individual states and to the people. From a strict constructionist’s point of view, then, anything the federal government does that is not enumerated as its prerogative in the Constitution is, by definition, unconstitutional and therefore illegal.
Nowhere in the Constitution does it say that the federal government is permitted to stick its nose into the field of education, for example, yet we have a federal bureaucracy that does just that. (The Department of Education was Jimmy Carter’s payola to the NEA for supporting him in '76.) A constructionist would say that the federal Department of Education is unconstitutional and illegal.
Where the Constitution fails, and where the more liberal among us gleefully step in, is in its vagueness. Particular powers given to the federal government include things like “promote the general welfare” and “provide for the common defense.” These phrases are sufficiently wishy-washy to have permitted Congress and presidents to concoct a huge variety of ridiculous programs and agencies. The “common defense” clause, f’rinstance, was the wormhole the feds used to get into the highway-building business and to justify the construction of hundreds of reservoirs. The “general welfare” clause, though, is King among gateways used by the feds. That clause was certainly the best friend FDR ever had, opening the door to things like TVA, BuRec, and the myriad social welfare programs that began during the reign of King Franklin and are largely still in place today. (Where’d ya think they got the word ‘welfare?’)
I guess I’m trying to say that, when it comes to “relying on… provisions of the U.S. Constitution,” the onus should be on the federal government, not on me.
I’m familiar with the principles of the U.S. Constitution, thanks.
When I asked what provisions you were relying upon, I was going on the assumption that you would have more than just “it’s unconstitutional,” like maybe a court case, an argument based on specific constitutional provisions, or similar analysis.
For example, the Supreme Court has rejected a challenge to the Tennessee Valley Authority and its sale of electricity on the open market, even though those sales may undercut private utility companies. See Tennessee Electric Power Co. v. Tennessee Valley Authority, 306 U.S. 118 (1939), at pp. 143-144:
So, it looks to me like the Supreme Court has held that Congress can create a government entity which can carry on a business, without infringing either the 9th or 10th Amendments. Nor is such activity an interference with state authority, since the federal government is simply using its property in a certain way, not purporting to regulate local commerce.
Do you have some contrary authority to support your suggestion that such activity is unconstitutional?
I have this creepy feeling that we’re about to be shuttled from GQ to maybe GD or BBQ, but here goes…
It does not surprise me that a (packed) Supreme Court circa 1939 would side with TVA. It relieves me that FDR’s plan to pack the court further was nixed, else we’d still all be cutting timber in a CCC camp for a couple bucks a day, and the “NRA” would mean something else altogether.
I guess my only “contrary authority” is common sense. Oh, and I think we could throw in a basic grasp of the English language. Maybe a bit of history for leavening…
The federal government is “simply using its property?” What property? How did the federal government come to have as its ‘property’ the whole of the Tennessee River watershed? I’m reasonably sure that the “property” the TVA took over was once the property of individual citizens. I know for a fact that TVA has used its federal mandate to preclude any private or corporate competition within its kingdom.
I was once deeply involved in the ‘alternative energy’ business, and our thrust was hydro. For a brief period in the early 80’s, hydro made sense, but that was mainly because of some pretty bizarre federal regulations – ANOTHER example of the feds with long noses…
NOTHING in the Tennessee River valley was available for consideration – absolutely nothing. While small and low-head hydro was flourishing from the Pacific NW to Texas to New England to Wisconsin, nothing, absolutely nothing, was happening in the hallowed Tennessee Valley. This was by fiat from TVA. Even the Army Corps of Engineers wouldn’t go up against the vaunted TVA.
My view that TVA in general is unconstitutional is unchanged. I feel pretty free to offer that as fact pretty much whenever I choose. My view that TVA has outlived its usefulness is much easier to demonstrate. Last time I checked, TVA is selling its juice for a much higher rate than is asked by any of its regionally local competitors. Wracked by scandals, burdened with outdated technology, unable/unwilling to accept the world as it is, TVA is stuck peddling overpriced electricity and underdeveloped fertilizers. TVA is not just unconstitutional; it’s stupid, and was from the beginning.
Yes, Piper, the federal government can create an entity that sorta resembles a corporation, and that entity can do pretty much whatever it wants to. And when the Supreme Court is leaning just the right (left?) way, said entity can get by with just about anything – strictly legally speaking.
It pays me well to keep in mind that what any court says is “constitutional” on “unconstitutional” has a lot more to do with the politics of the moment than it has to do with the document itself. I’m sure you know that routine, eh?
The idea of creating government corporations confuses and befuddles me. One idea that I have is to have the federal government start charging realistic fees for the leases of public lands. For example, charge higher fees for logging companies, ranchers with large herds of cattle, mining companies, etc. Maybe go so far as to hire companies to determine fair market value and take a cut of the action. I believe this could bring in quite a lot of revenue.