Arnold Kling has been reading and thinking about Mencius Moldbug‘s notion of neocameralism, and he asks the folks at Creative Capitalism, Why not have profit-maximizing governments?
Shareholders would be looking to maximize their returns. If the leader engages in arbitrary confiscation, she may be able to pay a nice short-term dividend. However, such a policy will lower the society’s wealth and reduce future dividends. Shareholders would prefer a more farsighted policy. A leader who protects property rights and invests in public goods probably will generate a higher share price.A poorly-run country, such as Zimbabwe, probably would be taken over by investors seeking to profit from a turnaround. These investors would buy up shares and install new management.
I think he states his points more poetically on his own site:
One way to think about a profit-maximizing government is that it is like a slave-owner who realizes that feeding and educating his slaves is the best way to earn a high return on his assets.Most people would say that we live in a world in which we are not slaves to government. It could be that, or it could just be that our masters are somewhat diffuse and dysfunctional.
States already have massive tax revenues, and they already sell debt. It is a bit odd that they don’t sell equity and maximize profits.
Instead, we declare that they should operate in the best interests of The People — whoever they are — and rely on tradition and social conventions to keep the politicians and bureaucrats from dividing the spoils too transparently. They do divvy them up though; they just have to do so very inefficiently, by handing out sinecures.