Saturday, July 31, 2004

No Free Lunches

David Friedman may be an anarcho-capitalist, but the following statements of his, quoted on the Adam Smith Institute's blog, capture very well the way in which the agendas pushed by special interest groups tend to work out in practice.

"Special interest politics is a simple game. A hundred people sit in a circle, each with his pocket full of pennies. A politician walks around the outside of the circle, taking a penny from each person. No one minds; who cares about a penny? When he has gotten all the way around the circle, the politician throws fifty cents down in front of one person, who is overjoyed at the unexpected windfall. That process is repeated, ending with a different person. After a hundred rounds everyone is a hundred cents poorer, fifty cents richer, and happy."
This is a bit of an oversimplification of course; what makes special interest politicking especially pernicious in real life is that some people are made far better off for having engaged in it, with the most successful raking in hundreds of millions or even billions of dollars from it, while the costs to the rest of the populace tend not only to be diffuse but also opaque to reckoning.