Diffused Costs And Concentrated Benefits, Are Why Politicians Will Never Cut Spending.

This is a short video from learnliberty.org about the uphill battle we have in trying to roll back the size of Government, and hold on to our individual liberty. Any growth of Government means a reciprocal loss in individual freedom, why, because the decision of the individual is usurped by Government bureaucrats who are back stopped by the coercive power of the state.

The growth of Government and the corresponding loss of individual liberty has happened incrementally over the past century. The result is that Government programs that started out relatively small have grown so big, and have caught so many people in the Government’s net of dependency, that you can’t even talk about cutting them back without being labeled an extremist. When I talk about the net of dependency I’m not just talking about welfare for the “poor”, I’m also talking about entitlement programs like social security and medicare, and also corporate welfare subsidies like GM’s Chevy volt subsidy, GE’s wind turbine subsidy, agriculture subsidies, bank bailouts, wall street bailouts, and thousands more. Read here for more about corporate welfare and entitlement programs.

These subsidies, in every part of the welfare spectrum, create their own constituency group that will fight to the death before they will think about agreeing to a cut in their subsidy. Recipients and administrators of this “welfare state” have no idea that the most important constituency group is the tax payers who fund the entitlement state. If the productive class decided not to produce, their would be nothing to confiscate and redistribute. If the tax paying producers ever came together as an organized constituency, this loss of individual liberty through the expansionist state would stop.

Tax payers don’t fight as hard to protect themselves against confiscatory taxes and regulations, as the receivers of this Government largess fight to maintain their ill-gotten gains. Each constituency group cries about what would happen is their subsidy was cut. If the cost of each program is looked at individually, it doesn’t look like that much in tax dollars compared to the total federal budget. The costs are pennies on the tax dollar when they are diffused among all the tax payers, and it doesn’t seem worth fighting a special interest group. The concentrated benefit to the constituency group means they will be highly motivated, and well-funded for the fight to save their subsidy. Politicians will never cut these programs because the squeaky wheel always gets the Government grease, especially if the squeaky wheel can deliver a bloc of votes for the next election.

For more analysis read “Why Government Can’t Make Decisions Rationally”, by Ben O’Neill at mises.org.

Explore posts in the same categories: Econ. 101, Government and Politics

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