The general belief is that the national legislature acts in the best interests of the people. The meaning of “the people” usually means those who are thought to be the “meek” or those in particular need or helpless. This idea is rooted in our Christian tradition. We are programmed from birth to approve “helping the poor.” “Helping the poor” is the core of Christianity, our national religion. In this note, I propose to overturn this common belief about the intention of legislation. Recall that Copernicus corrected the mistaken belief that the Earth was the center of the solar system. I will argue that “helping the poor” is merely a plausible cover story. The true beneficiaries of most government programs are powerful constituencies with good lobbyists and effective communications systems.
As a preliminary matter, let us distinguish between a totalitarian system and a free society. A totalitarian system, as the name implies, concerns itself with the totality, with the entire domain of human action. In a totalitarian system there is no realm of human action that is exempt from government intrusion. In a free society, areas of privacy are reserved to individuals. There are two domains of human action in a free society, the public and the private. The government of a free society concerns itself with the public domain and leaves individuals free to act within the private domain. Obviously, the private domain can be small or large. The general tendency of government is a slow encroachment over time of the zone of privacy culminating in a totalitarian system. Please note that a totalitarian system can have benign face or a malicious one. The American, mostly totalitarian, system has a benign face in the eyes of most Americans.
In the zones of privacy, individuals are free to choose and act in accordance with their choices. When the individual makes mistakes, he bears the consequences for his actions. An indication of a growing totalitarian system is the unwillingness of the government to allow the individual to suffer the consequences of his free choice. The cost of government interference with the negative consequence (think of this as a “bail out”) is used to justify eliminating the zone of privacy. For example, the freedom to ride a motorcycle without a helmet is said to cause public expenditures because the head-damaged rider is a burden on the public health system. Therefore, the totalitarian argument goes, the rider must be denied the freedom to choose not to wear a helmet. States are divided on this issue. Given the progressive nature of totalitarianism, though, soon all states will require helmets.
This example brings us to an important point: the analysis of a government regulation in the context of public or private does not depend on the wisdom of the regulation. Many people would agree that it is wise to wear a helmet while riding a motorcycle. But that is not the question if the area of action is in a zone of privacy. Privacy means not merely the right to choose the wise action, but the right to choose the unwise action and to suffer the consequences. This is the primary meaning of freedom.
So when evaluating a law, the first consideration is not whether it is wise or unwise. The first question is: is the zone of human action sought to be controlled a zone of privacy or a public zone?
Obviously, as the totalitarian state progresses, more and more zones of privacy affect public matters and there is a natural acceleration to complete totalitarianism. In the motorcycle helmet law case, the existence of free government health care permits the unwise motorcyclist to escape one of the possible consequences of his foolishness: catastrophic injury without government provided health care. Of course, in a free society, the helmetless rider would be free to purchase (or not) insurance to cover catastrophic injuries.
How are the public / private zones of human action defined? The current method is democracy. Individuals of diverse backgrounds and education are elected to public office as legislators. They are not elected because they are good legislators, usually, but because they are good liars. They are able to convince broad constituencies that the legislator is very interested in the special interests of all his groups, even when those special interests are in direct conflict. When in office, the legislators propose legislation based upon their own interests and those of their constituencies without regard to philosophical considerations such as totalitarianism versus free society or public versus private zones of action.
The question "how are the public / private zones of human action defined?" is perhaps thepolitical question. My answer is “mind your own business.” This is Plato’s answer. A brief defense of the answer is this: Each of us is most interested in his own survival and flourishing. We are closest to the particular circumstances that are relevant to all of our life choices and thus best able to make the right choice to insure our survival and flourishing. Thus, if the goal is life, I should mind my own business and you yours. My business is my personal flourishing. Your business is your own personal flourishing. We come together in the interest of personal flourishing to trade the product of our individual effort. We form governments to protect our property and resolve disputes that arise in our trading. Our governments defend us from foreign attacks. The functions of government are the police, the courts, and the army. Period. This is the Libertarian position. The other extreme would be the various totalitarian systems in which the government controls all property and all human action down to the smallest detail.
With that background, let us return to my political Copernican Revolution. Our present system, on the road to serfdom, is a system of crony capitalism. People with access to the legislature influence the legislature to serve their monetary interests.
Every profession participates in this system of crony capitalism: doctors, lawyers, pharmacists, accountants, and on down the chain of professions to beauticians in some states. Large industries participate: agriculture, the airlines, the rail roads, the oil industry, the banks, pharmaceutical companies, the medical industry at large, universities, climatologists, the so-called military industrial complex, etc. Of course, unions are major players in the game of crony capitalism. Everybody with money is a potential participant in crony capitalism.
Even onion farmers in Georgia participate. It is a felony to label the wrong onion a “Vidalia” onion in Georgia. Do not misunderstand. I am not criticizing trademark protection in general. I am criticizing a special industry specific law that protects a favored South Georgia constituency with a unique law. The reason for the special law is not to protect consumers. There are many other general consumer protection laws that do that, including other trademark laws. The reason for the law is to protect a special, preferred group to maintain their monopoly in hope that their profits will be protected. (Note that there is no special law making it a felony to label a “Pepsi” a “Coke” in Georgia.) This exemplifies the political Copernican Revolution being explained in this note. The consumer is not the center of the universe in this example. The onion farmer is the center of the universe.
Lawyers are protected in their profession by laws prohibiting the unlicensed practice of law. The requirements to become a lawyer are quite onerous. The practice of law is well protected. The stated reason is the protection of clients from incompetent non-lawyers. Again, the center of this universe is not really the client, but the lawyer. The consequence is the very high cost of legal services. Is anybody really worth $600 per hour?
Most laws, beyond those laws that have been on the books for centuries (murder, rape, armed robbery, theft), are for the benefit of a moneyed constituency. The national legislature is in session all year round solely for the purpose of crafting legislation to benefit, not “the people,” but to benefit various moneyed constituencies. The consequence to “the people” for endless legislation is higher costs on every front.
Let me provide examples.
The Transportation Security Agency (TSA) was created in response to the terrorist attacks of September 11, 2001. The goal stated goal was to stop terrorists from capturing airplanes and turning them into airborne missiles. The reason now is alleged to be the protection of passengers on each flight from death by terrorist. But why not protect passengers on buses or trains or ships from this low risk event. (No doubt our totalitarian system would do this if they had the money.) The real motive of the TSA is to remove a cost from the income/expense statement of the airlines. The Government takeover of airline security is a substantial benefit to the bottom line of the airline industry. (The TSA is funded by taxpayers, by a fee collected on round trip tickets, and by a fee paid by the airlines based upon year 2000 domestic screening costs.) Recall that the airlines received a financial bailout after 9-11. In a free society, the airlines would have paid for that failure, fair or not.
The political Copernican Revolution suggests that the TSA is about a crony capitalism benefit to the airline industry more than it is about passenger security.
Another example: we all know that medical costs are through the roof. Have you ever considered that this is an intended result of government regulation of health care? Medicare and Medicaid are alleged to be altruistic systems to help the poor and elderly pay their medical costs. What they actually are is payment mechanisms for the medical industry.
My theory is that almost all legislation is intended to benefit some point on the balance sheet or income/expense statement of a moneyed constituency. The government programs Medicaid and Medicare impact the gross income line of doctors and hospitals. The medical system is almost completely totalitarian at present, so it is difficult for some to imagine what it would look like in a free society. First of all, doctors (like lawyers) would not have a monopoly on providing medical services. Most parents, by the time their children are 10-years-old are fully trained in childhood diseases and could safely treat most of them. In a free society, as in many third-world countries today, a parent could to walk into a grocery store without a prescription and by "the pink stuff" (amoxicillin) to treat his child’s earache. All routine pediatric care would be reduced to the cost of a McDonald’s Happy Meal.
Certainly, highly trained, and therefore expensive, professionals would continue to be needed. But they too would face enormous price pressure by competing former physician assistants, nurse practitioners, and competent lay persons.
Consider this example. You may be aware that the purchase of high dollar diagnostic equipment is controlled by the government. An entrepreneur cannot just go buy a Magnetic Resonance Imaging machine without a certificate of need from the Georgia Department of Community Health. The sole reason for this law is to protect the price that a particular provider can charge for a procedure on a patient by holding down the supply of the service. In the absence of this law, entrepreneurs would purchase MRI machines like pharmacies purchased photo developing machines for their stores decades ago. Of course, very few of us use these photo services now because the technology has moved beyond them. But in the MRI case, the cost per procedure would fall from $3,000 per procedure to $10 probably. And like the photo machines, new technology would come along and the MRI would be history, too. Because the government forbids this normal process of market development, we still pay a fortune for diagnostic MRI tests.
The medical industry is a complete mess. The mess is the product of crony capitalism. I think it is probably impossible to fix because these service providers are held in such high esteem. No legislator or voter would move to fix the system. The only solution is the unique geographic circumstance that created freedom in America in the first instance. People moved to the East coast from Europe in our early centuries seeking freedom. As government regulations increased on the East coast people moved westward toward more freedom. Further movement is not possible. It is no longer possible to move away from totalitarian systems and into areas of freedom. We are doomed to achieve full totalitarianism.
I would rather not end with a medical example because I have (or had?) many doctor friends.
Consider the minimum wage law, a law whose stated purpose is to increase the wages of the poor. The unemployment rate for teenagers is over 40 percent at this writing. Teenagers have been priced out of the employment by this “well-intended” law. The federal minimum wage is $7.25 per hour. Is it better to have no job, than to have a job under the minimum wage? No one in his right mind can claim that the minimum wage law benefits teenagers. The law simply makes it illegal to employ people in work that is worth less than $7.25 to perform. Stated again another way, it is illegal for two people to trade one hour of labor for less than $7.25 even if the transaction is completely voluntary, sorely needed, and urgently sought by both parties. The true beneficiary of this law is the unions that benefit from a reduction in the work force. The union members eliminate thousands of competitors from the work force. A more vicious law is not on the books.
Finally, consider the War on Drugs. The political Copernican Revolution explanation for this law escaped me for some time. While it is undeniably wise to avoid habitual intoxication, in what way is it my business that a person chooses habitual intoxication? Common answers are physical danger (e.g. driving under the influence) and the burden on the public health care system. These problems are easily solved by providing harsh penalties for people who hurt or kill others while intoxicated and by eliminating all public health care. A consideration of the consequences of the American experiment with Prohibition in the 1930s ought to be enough to do away with the War on Drugs. So what sustains this terrible policy? Who are the beneficiaries? Criminal defense attorneys? I do this work, yet I advocate full repeal of all drug laws. None of my colleagues would say that they like the War on Drugs becausethey make a living by it. Some might have sympathy of the War on Drugs for the standard reasons that any citizen might give. Judges, prosecutors, police, prison guards, and the prison system all are provided with “product” (“product” means the people who violate the drug laws and are caught to be processed by the system) and therefore their living as a consequence of the War on Drugs. I do not think that any of these would articulate job security as a factor in their support of the War on Drugs. I think the real beneficiaries of the War on Drugs are pharmaceutical companies. Can you imagine the loss of revenue if a person could legally self-medicate for bi-polar disease, depression, cancer, or whatever, by using very cheap and unregulated drugs, like medical marijuana? Billions of dollars in profit for the pharmaceutical companies are at stake. These companies can hirer all the professional and degreed apologists they need to keep a gullible public and greedy legislatures fooled as to the real reason for the War on Drugs.
This problem, too, is unlikely to be solved in our lifetimes. People love to meddle in the lives of others. “Mind your own business” is not a widely held virtue in America.
The political Copernican Revolution teaches that we should not believe legislators when they tell us that their new law is “for the children,” “for grandma,” “for the needy,” “to save the planet,” or “to save the consumer.” Without exception, new laws are designed to provide an economic benefit for a moneyed constituency. The named beneficiary is merely a cover story to provide a plausible excuse for fleecing the public or a competitor.
