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30 Economics in One Lessonthat failed. It would increase the demand for socialism: for, it wouldproperly be asked, if the government is going to bear the risks, whyshould it not also get the profits? What justification could there possiblybe, in fact, for asking the taxpayers to take the risks while permittingprivate capitalists to keep the profits? (This is precisely, however,as we shall later see, what we already do in the case of“nonrecourse” government loans to farmers.)But we shall pass over all these evils for the moment, and concentrateon just one consequence of loans of this type. This is that theywill waste capital and reduce production. They will throw the availablecapital into bad or at best dubious projects. They will throw it into thehands of persons who are less competent or less trustworthy thanthose who would otherwise have got it. For the amount of real capitalat any moment (as distinguished from monetary tokens run off ona printing press) is limited. What is put into the hands of B cannot beput into the hands of A.People want to invest their own capital. But they are cautious. Theywant to get it back. Most lenders, therefore, investigate any proposalcarefully before they risk their own money in it. They weigh theprospect of profits against the chances of loss. They may sometimesmake mistakes. But for several reasons they are likely to make fewermistakes than government lenders. In the first place, the money iseither their own or has been voluntarily entrusted to them. In the caseof government lending the money is that of other people, and it hasbeen taken from them, regardless of their personal wish, in taxes. Theprivate money will be invested only where repayment with interest orprofit is definitely expected. This is a sign that the persons to whomthe money has been lent will be expected to produce things for themarket that people actually want. The government money, on theother hand, is likely to be lent for some vague general purpose like“creating employment;” and the more inefficient the work—that is,the greater the volume of employment it requires in relation to thevalue of product—the more highly thought of the investment is likelyto be.