10. The role of local governments

The govlet is not necessarily the right solution for every problem. By being borderless, the advantage of a govlet is to reach and mobilize people everywhere for the same political goals; however, the flip side is that the govlet’s policy cannot possibly be tailored to local needs and local conditions, while retaining its global appeal.

The existing state and local governments remain a very efficient form to manage the local real estates, such as roads, bridges, building and fire codes, zoning etc. The distributed govlets are likely to cause havoc if being applied to the local real estate management: Just imaging individual sections of your local roads and bridges are owned and operated by different govlets, and they are built and maintained with varying quality and standards, it wouldn't be a pleasant experience. Most people would agree that the proper zoning of a city helps everyone; the city therefore needs some authority over all the people and businesses within its territory to enforce a consistent zoning. In addition, when it comes to infrastructure projects, such as roads, bridges, train rails, airports etc, the benefits, costs and environmental impacts are all localized, therefore a local government with a well defined territory is at a much better position to organize these projects than a territory-less govlet.

However, besides the real estate management, all the other major functions and services of the state and local governments can be transferred to competing govlets. In the following pie chart of the local and state government spending (courtesy of usgovernmentspending.com), the bulk of the state and local government spending is in the areas of education, health, pension, welfare, protection, which are not related to local real estate management, thus can be effectively managed by competing govlets.

Though more difficult, it is possible to introduce more competitions to state and local governments even for the real estate management; this is not the main point of the blog thus I will postpone the discussion. However, to put the matter in the right perspective: If we manage to migrate 90% of the local government spending to competing govlets, the main problem of government waste and inefficiencies are solved; and we should be able to live happily with the the remaining 10% of the current government spending, such as defense, environment protection and real estate management, still being monopolized by the much smaller local and federal governments.