The fundamental problem I see here is the lack of acknowledgement of the simple fact that government doesn't produce added value, in an economic sense. There are only 3 ways that you produce added value, you grow it, you dig it out of the ground, or you manufacture it. Government does none of these things, ergo, government doesn't produce added value, ergo government is overhead. Overhead needed for running a society.
Do not misconstrue that government doesn't do things that are valuable, it does. Essential, yes, that too. But it doesn't produce value added. So it's a value sink, and not a value source in the economic scheme of things.
What is overhead, and what is added value? No society can exist without transportation links, that's a given. So American Airlines, FedEx, Greyhound(or other entities identical in purpose and configuration) can all be considered overhead, not added value, but necessary infrastructure? You uber-right folks love your guns and frontiersman image, and can take care of yourselves, so are police forces overhead or added value? Police can be either public or private, and there are differing sets of problems with each, but which is it- value added, or just a drain on the private sector? There are private schools that charge a lot of money to turn out educated professionals, undoubtedly needed for running society, and there are heavily subsidized public schools that do the same. Overhead, or are they adding value?
Try another little thought experiment if this seems an abstraction. Let's say some wacky future government decides to privatize all present government services- police, prisons, the military, etc. It then nationalizes all previously private endevours. Your local Starbucks becomes the peoples stimulant outlet no. 66771. So now who is paying the bills? Are you now going to grouse about those hard working mailmen and prison guards, whose taxes are going to support extras like restaurants, coffee shops, and cell phone makers, necessary yes, but really just a drain on society? You see where this is going, do you not?
Your idea that value must be dug up, grown, or manufactured is quaintly 19th century in outlook. In today's world the most lucrative businesses produce the most abstract services. Facebook, Microsoft, Google.....they are all pretty far from agriculture and smokestack industry. Most goods and services today can function equally within the public or private sphere, although there is a spectrum with some functions becoming problematic at either end. A private army doesn't work too well, although is not impossible. The peoples stimulant outlet no. 66771 is not an entity I'd hold my breath on, although there is no essential economic reason why it could not exist.
Apply the calculations to the government, I think you'll see it more clearly. Government is simply society's overhead costs. And as such, should be limited, reduced at every turn, ruthlessly controlled.
I know. All those concepts are probably foreign to you when applied to government. Pity really.
I'd say it is pretty clear that government provides a number of very desirable services that would have to be shouldered by private industry if they did not exist. In other words, they add value to society, and have worth. If you want to get ruthless with government, and push more of such into the private sector, well that is quite doable, but not without its set of problems. How have private prisons done in the US? Would you like Blackwater doing security in your neighbourhood? We hardly need mention the US medical system, where just on the news today, a firm making "Epipens" (preloaded syringes filled with a $1 drug that counters the effects of extreme allergic reaction) has bumped up the price from $50 to $600. You may have to look at a few dead kids lying beside a half eaten peanut butter sandwich, but oh- the profits! They're adding value.....but not to society.
