Finding the best form of social organisation
Beyond our own self-interest, there is the common good. We may wish well for others because we hope that such a desire will come back to bless us. Alternatively, we could just take pleasure from seeing the world well-ordered, even if we don't directly benefit. The most cynical, corrupt politician may nevertheless use his role in public life to benefit others, even if it's just because he wants a tearful funeral, a glowing obituary and a statue.
Religion teaches charity and self-sacrifice, but Ayn Rand despises this ethos because it enfeebles the strong and encourages social parasitism. Rand may be extremist, but other advocates of enterprise point out more tactfully how the pursuit of self-interest means that people do what others need them to do, and we all end up better off. If I have more meat than I need and you have more vegetables than you need, we can swap some of our surplus and each enjoy a varied diet. Money and shipping let me swap my particular type of surplus goods for any other surplus anywhere.
Better-off countries are places where you can prove what you own, and enforce agreements on commerce. The most liberal of ideologues still support contract-law. Liberals and conservatives will also unite in supporting a statutory authority which provides police, courts and national defence. Much political argument in advanced nations is therefore about how much more than that minimum a government can and should do. Such argument isn't just about the ethics of state-intervention but also about its efficacy.
How dictatorships fail
Countries where government has exercised almost complete control have been effective militarily but less so materially. Even then, the Nazis and Bolsheviks were eventually beaten by capitalist democracies whose values they may have seen as frivolous. It needs considerable nerve to assert that the former east Germany, old-style China and modern North Korea were or are more pleasant places to live than former west Germany, old Hong Kong and modern South Korea. In material terms at least, commerce beats government, which is why the heirs to communism are all social democrats now.
The utopia which the west has built since the second world war tries to combine the benefits of the market with the comfort of a state-run safety-net. Our taxes hurt us but we sleep more peacefully knowing that the cost of expensive surgery need not bankrupt us because the collective will pay for it. The right has complained that government runs things badly and outdoor relief saps incentive, but most of us keep on voting for parties that run commerce and welfare in joint harness.
We children of the 1950s have been served well by this system. We've never paid for our education or healthcare, yet taxation has left us enough to live modestly on. We're told, though, that this party is now nearly over. While we thought we were paying our way and covering our welfare-costs out of current earnings, it seems that we were actually incurring debt as we consumed all those benefits. Not only did the people in power not tell us this, but neither did they tell us that they weren't making anything like adequate provision for future needs. And the problems aren't just in the public sphere.
We imagined that the economy was growing thanks to our efforts (and maybe also because of all that free schooling and medicine we got). It turns out that the growth was fake - based on trade in overvalued property and the exchange of vacuous financial instruments. Worse, our specialisation in services, which we thought represented cultural progress, has cut us off from our industrial base and allowed low-wage economies to dominate manufacturing. We are now left, in the cities we built on farmland, effetely paring our fingernails as we await the collapse of all our inflated debt and virtual money.
Fixing current problems
In their solitary moments of introspective candour, politicians know that what must be undertaken is the careful dismantling of this unstable scaffold of bloated governments, squid-like finance-houses and legal ponzi-schemes. The electorate may know this too, but they're blowed if they're going to let it happen. Voters believe that they've been doing what they were told to do - get a job, pay your tax and trust business and the state with the big stuff. Parties which try to rein-back on the pensions we all thought we were saving-up for are replaced by other parties who promise even more generous superannuation at a younger age.
It seems that we're doomed and that the market is about to enact a massive correction on us all. There will be a harsh refocusing on what mankind really values - shelter, water, food and means of exchange which seem tied to reality rather than to a speculators' market. Even before this cataclysm, there must be questions about what has gone wrong. By marrying the state to the market, we thought we'd achieved the perfect match. Rather than nationalising undertakings, we regulated them. The idea was to let enterprise rip within a framework that served the common good.
The right will say our problem is a too-big state. The left will say it's high finance out of control. Each will think the other wrong, yet maybe both are right (except in thinking the other wrong). Not only do we have insupportable welfare-commitments and burdensome regulation, but we also have some banks going bust while other banks rig interest-rates.
Starting anew
A reboot of the economy is likely to be more about survival than careful considerations of alternatives. However, during a war, a prudent government plans for the peace. We can usefully consider what we might do if we started again. And I propose actually to begin with ethics rather than with pragmatics or even desired outcomes.
There will be some who believe that people are best served by being told what to do by the state, in exchange for having their needs met by that same state. To such folk I must bid an ideological farewell. Even if totalitarianism brought immense happiness, it would undermine human autonomy. As it is, an all-powerful state brings not just cultural repression but economic paralysis too. With the neo-fascist or the neo-communist, one must just agree to disagree and do all one can to prevent them from taking over.
Getting ethical
Even if we aren't very moral people ourselves, we might promote an ethical social policy on the grounds that it embodied something good. I would personally like to start from a theological point of view, but doing so will not carry many people with me. Instead, let's start with the integrity of the human person. An ethical state would want to prevent violence among its people, so that we would not live in fear but could go about our lives unmolested. So far so good; we may perhaps usefully postpone discussion of what is done punitively to those who do attack others.
Next, I'd suggest, come our personal possessions, ranging from a mansion to a ballpoint pen. It makes sense for society also to prevent damage to, and theft of, all property. Now that might seem uncontroversial but I think we instantly get into problems when it comes to the amount of money that the state presently takes from us. Even if we thought that that money was all being spent superbly, it's surely wrong to have such a large proportion of earnings and spending confiscated. Ethics aside, it's asserted that government does things half as well as the private sector, in other words costing twice as much to perform the same tasks.
Even if public spending delivered value for money, it could still be argued that government takes too much. The Heritage Foundation says the UK government takes some two-fifths of GDP. Furthermore, most of this money isn't used to help the very poor. It's used for much grander projects, many of which can be delivered privately. Such commercial delivery of services has been shown to be feasible through denationalisation. However, at root is the unethical nature of such widespread expropriation of people's earnings. We even pay tax on simply occupying housing and once we are dead.
Protecting people and property
I'd suggest, then, that a new civilisation which rises from the ashes of the present one might usefully protect people and property, and that means inter alia low taxation. We presently assume that, since there are problems in society, government must fix them regardless of the cost. Instead, we need to ask what proportion of our capital and earnings government can ethically expropriate. (Even a tenth seems quite a lot to me.) Once we have that proportion, we multiply it by GDP and there we have the public sector's budget. Within that, we allocate funds according to priority, and I would suggest that defence and justice came first.