“Trust in our government” has been a popular topic in the news cycle for generations. Pew Research Center conducted a study this past May on this very issue. The National Election Study started taking data on trust in the government back in 1958. Then, roughly two-thirds of the public had faith in the federal government. Today, Only about one-quarter of Americans say they can trust the government in Washington to do what is right 'just about always' (2%) or 'most of the time' (22%).
Our class has studied efficient resource allocation much in the past three weeks. When 
, there are no externalities and no misallocation of resources. Yet when externalities are present, the government can either set restrictions or levy taxes and subsidies to try and return to . The government uses consumer votes to determine their taxes, yet the flaw with this system is consumers have little incentive to accurately reveal their preferences. Most consumers do not trust the government in general, thus they certainly don’t trust the government with taxes. Instead, utility-maximizing consumers latch onto the “free rider” principle by trying to contribute as little as possible while still using the resource. According to Charles Tiebout, “[i]f all consumer-voters could somehow be forced to reveal their true preferences for public goods, then the amount of such goods to be produced and the appropriate benefits tax could be determined” (p. 417). Because of the low percentage of Americans that have faith in the government, consumers do not reveal their true preferences and the government cannot tax efficiently. If more of the population trusted in the government, they would reveal their true preferences and be accurately taxed. Externalities would be eradicated, , and our society would be better off.
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