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Monday, October 12, 2015

Who Exactly Is Government Helping?

The State Is a Quagmire at Every Level

Almost everyone believes that government is an essential institution, necessary to protect us from those threats we cannot counter on our own. But even if we accept that justification, it rarely describes what American government actually does, whether at the local, state, or federal level.

What exactly is the government protecting — and from whom?

Local Protection from Food Trucks

Late last year, Rachel Kennedy wanted to bring a Cuban food truck to North Kansas City, Missouri, a town of four square miles and 4,500 people. That shouldn’t have been controversial. The city agreed to allow the trucks to operate during lunchtime, and several other operators came, too. There was no reason to restrict the trucks to lunchtime, but never mind. At least for one meal a day, consumers enjoyed more choices at less cost. What could possibly go wrong?

The restaurant owners might lobby to expel the food trucks, that’s what. Choice and competition are good, except when you are an incumbent provider. Monte Martello, a local Dairy Queen operator, complained, “They bring the truck in, they compete against us for four hours, and then they drive away.” Outrageous!

Choice and competition are good, except when you are an incumbent provider. 

Worse, Martello went on, “They don’t actually contribute to the community in any way.” All the food trucks do is provide hungry people with lunch, and nothing more. If that’s all, who needs them? City Councilman Gene Bruns asked, “Why are we trying to rob our local businesses with vendors that come in from outside?”

Once the protest got going, city officials ran for cover. The community development director who helped arrange the pilot program refused to take a position. The executive director of the business council refused to be quoted on the issue. Another city councilman suggested allowing in the trucks once a week as a “compromise.” Even that would “rob” some restaurant of some business. Why not restrict the trucks to midnight every other Wednesday?

This attack on basic liberty is occurring in the “land of the free.” Business owners bringing a new variety of foods to hungry consumers are said not to contribute to the community. Competing against existing restaurants is treated as theft. Public officials see government’s essential role as protecting restaurateurs from having to satisfy consumers’ desires, particularly to enjoy diverse forms of low-cost food. For this, the early Americans fought a revolution?

State Protection from Gas Pumps

Most Americans take for granted the opportunity to drive into a gas station, fuel their car, and get back on the road having spent less money than if they’d let someone else pump their gas for them.

But not in New Jersey and Oregon. These two states ban self-service stations. Earlier this year, legislation was introduced into both states to end the prohibition. In Oregon, the state house voted for repeal in rural counties. In New Jersey, legislative leaders announced that members would not be allowed to cast a vote. Governor Chris Christie has previously pushed for elimination of the ban — but not this year: “I[‘d] get my head handed to me.”

Public officials see government’s essential role as protecting restaurateurs from having to satisfy consumers’ desires.

Prohibitionists argue that self-serve stations are bad for the elderly, the handicapped, and, yes, those of limited height. But then why does New Jersey allow “self-serve” restaurants (buffets), supermarkets (fill your own cart), retail stores (try on clothes yourself), doctors (go to his or her office), and much more? Shouldn’t these businesses have to ensure that every special need is met? After all, America being the “land of the free” shouldn’t actually mean, well, “free.”

Of course, there are those other 48 states in which people seem to get by without a ban on self-serve pumps. New Jersey State Assemblyman Declan O’Scanlon asked, “Do they have no senior citizens in 48 other states? No short people?” Apparently not. Or if so, they must be living in horrid, pitiable conditions, unable to drive.

New Jersey State Senate President Stephen Sweeney, one of the chief obstacles to getting his state out of the gas-pumping business, argued: “In New Jersey, we grew up with it. People have gotten used to it. We like it.” No doubt he and his friends like it. Moreover, a 2012 poll found that 63 percent of residents preferred full service.

But then, who wouldn’t prefer to have someone else pump gas for you, all other things being equal? Many if not most people probably would prefer to save the money, which is why most states don’t prescribe who pumps what when. Estimates of the added cost run from 8 to 20 cents a gallon. In fact, it was not consumers who originally demanded the law. The prohibition came in decades ago at the behest of smaller gas station owners, who feared they would be undercut by stations owned by oil companies. Now, most stations are owned by independent operators, who are lobbying to end the restriction.

Even if the great majority of people prefer full-service pumps, there’s no need for legislation. After all, businesses gain from catering to consumer demand. If people are willing to pay more for someone to provide “full-service” gas, stations will offer that option. If Senator Sweeney believes full-service wouldn’t survive consumer freedom, it is because he realizes most people would choose to save money in practice, if not in answer to a survey question.

So here states are “protecting” people by prohibiting lower-cost alternatives.

Federal Protection from Employment

With little ability to push legislation through Congress, President Barack Obama is attempting to unilaterally reward his chief backers. One recent measure expanded mandatory overtime. Another would force government contractors to provide paid sick leave; some legislators would mandate that, plus paid parental leave, for all employers. The president is also pushing new guidelines and rules to force companies to turn independent contractors into company employees.

If the great majority of people prefer full-service pumps, there’s no need for legislation.

Set aside the convenient fact that the last measure would benefit the government by making tax collection easier. All of these steps only appear to help employees. As Milton Friedman once said, there ain’t no such thing as a free lunch.

Unless someone, say some Persian Gulf king or other potentate, is handing out free money to American businesses, government can only rearrange the compensation paid to workers. More money in fringe benefits means less money in salaries. More money to parents means less money to the childless. More money in government-mandated benefits for people as staff members means less money in pay for people as freelancers — as well as fewer people hired and fewer hours worked.

Thus, here is more government “protection,” this time at the national level, that makes people worse off. Indeed, examples like these demonstrate how often those who run the government act as if serving those governed is their last priority. In every one of these cases, it is clamorous interest groups that demand action in the name of everyone else. The fact that they benefit at everyone else’s expense should surprise no one.

Government routinely abuses its power. That’s not a particularly profound observation. Even if it doesn’t eliminate the justification for government, it should cause us to be far more skeptical in assessing the claims of those who lobby on behalf of expansive programs and restrictive regulations. Politicians and bureaucrats routinely come to us claiming that they want to help us. Instead, they make us pay more to eat, and pay more to drive to where we are going to eat. Far too often, they do much more harm than good.

  • Doug Bandow is a senior fellow at the Cato Institute and the author of a number of books on economics and politics. He writes regularly on military non-interventionism.