We will spend your money for you as the state knows it better

Day 680, 09:33 Published in Malaysia Malaysia by Nagyzee
This will be a very long article but hopefully it's worth reading. Sorry for taking so much of your time. In short it's a pamphlet against extensive government spending.


There has been more and more voices lately suggesting more government involvement in virtually everything and more government spending on virtually everything. The Federal Republic of South East Asia finally has its first openly socialist party but there are more and more voices inside for a shift into this direction in both big parties as well, especially in Federal Unity Party with Vikta's presidential platform also clearly showing several signs of this.

The common thing in most of these platforms is that they present only the more popular and easier side of such approaches. As I said there are more and more suggestions and programs on how we should spend more on this and that but usually very little on how we'd raise money to finance it. As money still doesn't grow on trees you can be quite sure that bigger government spending would be financed from taxing you heavier, dear citizen.


An analysis of the incomes and spending of the state

Currently daily tax income of the state is around 10 gold or exceeding it a bit which means that the state has a regular weekly income of around 70-75 golds. Apart from these the government can rely on some minor profits on monetary transactions, on printing MYR and on donations (congress gold donations foremost). The state usually receives around 70-90 gold from donations per month but the amount has been steadily decreasing as people were more willing to donate when the state was actually poor.

On the expenses part the biggest item is the cost of war games. These can cost up to 35-40 gold / week which will hopefully decrease to around 25-30 gold even if we stay in two war games as more countries enter said games. The state also loses money on the training companies continuously and the current social programs can eat quite a lot of money as well especially if they are run effectively and most new users that are in need are actually reached. Apart from that the state also has to build up reserves and can have high irregular expenses (an RW in Thailand can eat up quite a lot of money in the form of distribution of free weapons).

As for the future incomes of the state Vikta brought up the fact that as our population increases, tax income will increase as well and we can print more which will allow for programs requiring more extensive spending. But he didn't take into account that baby booms decrease the state's tax income per capita on the short to mid term. New citizens provide less tax income than old ones and to add to it they increase the state's social spendings per capita. This means that the state would have to rely on mostly printing to finance its extra spending which is a quite dangerous road to go and can lead to an inflation of the MYR and a sudden collapse of the government's income/spending structure if not being very careful. Alternatively taxes can be increased.🙂

In the next part of my article I'll go through some of the fields where people have been asking for more government spending / involvement.


State owned companies

The idea of the state operating more companies usually comes up in connection with the military and surfaces in suggestions of the state running higher quality weapon companies or even iron mines abroad. I see several problems with this. Foremost the state would have to tie down quite a lot of capital. In return if the companies are managed well they'd provide some profit or alternatively cheaper weapons to the state and the chance to stockpile.

Profit rates are quite low lately and I question whether it makes sense to tie down say 90 gold to achieve a daily profit of 0.5 gold on a q3 weapon company with the help of a government officer working for free. Quite often state-run companies are a lot less effective than privately owned ones as an officer working for free is less motivated to make extensive profitability calculations, to micromanage the company and so on than an entrepreneur working for his own profit.

The other thing is that why should we use government funds here when private capital is also willing to invest in these kind of companies and supply the market with these items? Also as the market for higher quality weapons is still rather small in FRoSEA state owned companies could very easily kill private business in these sectors.

And lastly about stockpiling. My opinion is that it is mostly important for the biggest countries, smaller countries can easily buy an adequate amount of weapons on the world markets for a fair price in an emergency situation at any given time in a matter of minutes. Also stockpiling in a world suffering from overproduction and decreasing prices doesn't seem that smart as the later you buy the cheaper it is for you.

The idea of the state buying up land companies that were opened in medium resource regions could also be mentioned here but let's not go into that one as well now.


Military spending

An increased and continuous military spending makes more sense than the former in my opinion, especially if one has more grandiose plans (in a sense) about the country's future and wanting to follow a more aggressive/interventionist foreign policy. I'm not a supporter of this route but of funding the military only in emergency and other serious situations. But we can agree to disagree here. Instead I'd like to point out two things to those supporting increased military spending involving regular funding.

If say we have 100 soldiers in the country's military which is not an unlikely number for the future even with our current number of active citizens then providing them with one single q1 weapon / week will already cost 11-12 gold which is a quite high chunk of our weekly income. And one q1 weapon / week is rather pathetic for regular funding, right?

The other thing which I could have mentioned elsewhere as well is about the psychology of regular transfers from the state to the citizen. These transfers might build up a mindset of "I deserve this and that for free from the state" among citizens and might put us on a slippery slope where citizens are asking for more and more. A military unit asking for even more funding is not such hard to imagine, I think. I could bring up examples from other e-countries for this mindset, maybe later I'll indeed will.


Social policy

I've left the biggest, most important and most controversial topic for last. Of course it's the social policy. First let's see what the state guarantees to new citizens (and others in need):

- 100% sure employment even with low wellness
- Higher wages than the added value created by the work of these new citizens (this is essentially a money transfer)
- Gifting / feeding up users to 40 wellness if they screw up their wellness
- Providing moving tickets for relocation to Peninsular Malaysia
- Educating new users about how to fight and keep wellness high
- Finding mentors for new citizens

Of course some of these programs are still not running at 100% efficiency and especially the mentorship program is in an embryonic state. But this has nothing to do with the state's unwillingness to fund these programs but with the Social Office being understaffed and/or people being lazy sometimes.😛 In my opinion we have to improve a lot on the field of education and I find it of utmost importance to integrate new players into the community (as being part of that and of smaller groups is what ultimately keeps us playing) and to teach them how to fish rather than giving them even more fish.

I find it stupid to motivate newbies with money. Throwing money at them unconditionally or for doing this and that is just lame and a bit of virtual money won't keep most people in a game that otherwise bores them. A friendly mail is a lot more effective than a donation of 10 MYR (scheduled for 1-2 days before getting 5 gold anyhow). On the material front I think we have to concentrate on avoiding frustration (coming for example from not being able to join battles or from being regularly fired from one's job because of low wellness), and that's it. Lotteries on the other hand are somewhat fun even if it's free to take part in them so house raffles as suggested by the new socialist party could have my support.🙂

And I've deliberately left my "favourite" suggestion for last. FRoSEA Socialist Party suggested gifting those who are above 40 wellness but are not willing to take part in the war games for some reason (like being a pacifist). I think this could be the epitome of pointless and stupid money spending. You know, the suggestion is about someone not willing to increase his/her wellness for free and instead relying on the government to do it from its funds. If this proposal ever goes through I'll do the following:

- Declare myself an anti-Stahanovist and lose my Hard Worker medals on the 30th days on purpose and *demand* from the state to compensate me for it
- Declare myself a light-eater or a fasting monk not eating food and *demand* from the state to gift me to compensate for my wellness loss.

You know, the state should support non-conventional approaches as well, not only the boring 'levelling'. Other similar suggestions are also welcome. We could milk the state for some major money.🙂


Conclusions

I could summarize my arguments and viewpoints as: money doesn't grow on trees and the state is not a cow that can be milked to no end without consequences so with more extensive spending most probably comes higher redistribution through the state and heavier taxing and/or living up and risking our future with not saving up money. If you think that the state can spend your money better than yourself or if you think that you'd be one of the winners of higher redistribution then increased government spending is maybe just what you need. If not then maybe not. At least please think about it!🙂

Thanks for taking your time to read this. I hope it was worth it.

Best regards,
Nagyzee
Minister of Finance and concerned citizen