Regulate it and They Will Lobby


Writing in New Hampshire's Union Leader, 20/20 star and friend o' reason John Stossel makes a familiar-to-reason-readers yet always underappreciated point about the influence of lobbyists and perversity of reform. Clip 'n' save for the Naderite (or McCainiac, or Obamaphile) in your family.

The Public Choice school of economics calls this the problem of concentrated benefits and dispersed costs. Individual members of relatively small interest groups stand to gain huge rewards when they lobby for government favors, but each taxpayer will pay only a tiny portion of the cost of any particular program, making opposition pointless. […]

"Good government" types rightly abhor this influence-peddling, but they propose pointless reforms like bans on lobbyist-sponsored gifts, junkets and rides on corporate jets. They also back a vicious assault on free speech: campaign-finance restrictions designed to reduce the influence of lobbyists in political campaigns. Despite all these "reforms," influence-peddling goes on.

For good reason. None of the reforms gets near root of the problem.

The root is government power. When government is free to meddle in every corner of our lives and regulate the economy through taxes, regulation and subsidies, then "special interests" have every incentive to work on the politicians to preserve their turf or gain an advantage. […]

The irony is that the "good government" types favor big government, so they undermine their own efforts to eliminate corruption. […]

There is one way to rid the political system of this sort of corruption: severely restrict government power as the founders intended. Only when we eliminate the state's ability to meddle in business will business will stop meddling in government.

Whole thing here. Stossel in reason here.