An old Slate Star Codex post on cost disease from 2017 features a comment that includes you: https://slatestarcodex.com/2017/02/17/highlights-from-the-comments-on-cost-disease/. It begins, "I think you gave short shrift to libertarian explanations of this phenomena. In particular, the Kling Theory of Public Choice may explain a significant fraction of cost disease: public policy will always choose to subsidize demand and restrict supply . . ."
"Public Choice" is a terrible name, unfortunately. It should be "Government Choice". It's only barely true that the public has a choice - all the decisions taken, chosen, are done by the government. (for the government).
"It emerged in the fifties and received widespread public attention in 1986, when James Buchanan, one of its two leading architects (the other was his colleague Gordon Tullock), was awarded the Nobel Prize in economics."
Gov't choice, gov't schools, gov't buildings, gov't ownership (of nearly 50% of the West). And virtually all of the Government Choice theory applies to dictatorships and quasi dictatorships and oligarchies - since they all develop gov't bureaucracies.
Like you say, because of special interests, who care more (especially Dems), the gov't usually subsidizes demand, and restricts supply.
It is stunning to watch the Biden administration cause immense problems and then beg for credit when it scrambles to patch the problem it caused.
I'm going to speak boldly here because the facts point to this conclusion: Progressivism / Socialism / Communism are inherently linked to the pathological belief that humans are a stain on the earth and the fewer, the better. The far-left loathes the idea of general prosperity. They hate the idea that people can enjoy an abundant life, independent of what government offers or allows.
Name a progressive idea that promotes human life and liberty. Everything they do is about constraining choice and pitting groups of people against each other. Progressive policies create misery and rather than fix the policy and admit error, the Progressives blame the Boogeyman and triple down on failure.
Election day cannot come soon enough. If we can make it that far...
True story. In 1985 I'm a college student hanging out with friends and trying to impress some girls. We go to a Shopko because one of the girls wants to buy a birthday card. This takes far longer than it should because being America there are hundreds of cards from which to choose. Demonstrating my geopolitical brilliance, I quipped, "If this were the Soviet Union we would have one choice of card and we'd be done shopping."
Scarcity is what leftists do best. It is engrained in their pathology. We need to actively oppose this mindset and show there is a better way.
What does that Josh Barro quote have to do with your meme? I checked out your link containing a transcript and searched for "supply", "demand", "restrict" & "subsidize" and didn't find anything.
With regard to email micropayments to kill spam, you could even set up the system in such a way that recipients keep the cash. So you'd effectively attach 0.001 cent to email you send out and recipients would keep the cash, and use it when they in turn send emails. For the vast majority of people, this would balance out, give or take a couple bucks a year.
Of course, you would see advertisers for the most valuable products willing to attach large sums (maybe $0.01!!!) to mails to their most valuable customers. Spammers though would be screwed.
Yes, Arnold, you didn't start Public Choice but you should take credit for a great meme. Many government interventions in markets for goods and services amount to restrict supply and subsidize demand (others amount to either restrict supply or subsidize demand). Unfortunately too many economists still ignore Public Choice and your meme because they want to serve their present or future political bosses.
I read just the introduction, not the full report, but it appeared to me that they were saying that the political pressure to subsidize demand becomes stronger and stronger as supply is restricted; so, politically, the only hope is to defeat the political forces of supply-restriction. If the latter are allowed to prevail, the pressures for demand-subsidization will prove irresistible.
It seems to me that the 'Public Choice' problem is driven by the classic issue that the benefits of supply-restriction flowing to a monopsony are going to be fiercely protected while the costs of the demand-subsidy are born by a diffuse populace that is difficult to organize to eliminate it. In the formula case, the single source WIC contracts provide the supply restriction. This drives people who need formula to demand a greater subsidy as prices rise (I saw a stat that half of all infants in the US are eligible for WIC!) rather than agitate for an end to the single source contract, coupled with the fact that nobody else is bothered sufficiently (who wants to be tagged as being against feeding babies?) to try to end it, either.
And yes, the answer is government action .. end the sole source contract!
Government action--which, according to Public Choice, is very unlikely. The Niskanen report should go one step further: as they say, the key to improving the situation is to defeat the supply-restricters; but the latter are a concentrated interest group which will very likely prevail. In short, defeatism.
An old Slate Star Codex post on cost disease from 2017 features a comment that includes you: https://slatestarcodex.com/2017/02/17/highlights-from-the-comments-on-cost-disease/. It begins, "I think you gave short shrift to libertarian explanations of this phenomena. In particular, the Kling Theory of Public Choice may explain a significant fraction of cost disease: public policy will always choose to subsidize demand and restrict supply . . ."
"Public Choice" is a terrible name, unfortunately. It should be "Government Choice". It's only barely true that the public has a choice - all the decisions taken, chosen, are done by the government. (for the government).
"It emerged in the fifties and received widespread public attention in 1986, when James Buchanan, one of its two leading architects (the other was his colleague Gordon Tullock), was awarded the Nobel Prize in economics."
Gov't choice, gov't schools, gov't buildings, gov't ownership (of nearly 50% of the West). And virtually all of the Government Choice theory applies to dictatorships and quasi dictatorships and oligarchies - since they all develop gov't bureaucracies.
Like you say, because of special interests, who care more (especially Dems), the gov't usually subsidizes demand, and restricts supply.
"Public Sector" is a terrible name.
Buchanan et al should not be blamed for straightforwardly using the lingo of economics.
Economists should be pushing to change that lingo, to be more accurate.
It is stunning to watch the Biden administration cause immense problems and then beg for credit when it scrambles to patch the problem it caused.
I'm going to speak boldly here because the facts point to this conclusion: Progressivism / Socialism / Communism are inherently linked to the pathological belief that humans are a stain on the earth and the fewer, the better. The far-left loathes the idea of general prosperity. They hate the idea that people can enjoy an abundant life, independent of what government offers or allows.
Name a progressive idea that promotes human life and liberty. Everything they do is about constraining choice and pitting groups of people against each other. Progressive policies create misery and rather than fix the policy and admit error, the Progressives blame the Boogeyman and triple down on failure.
Election day cannot come soon enough. If we can make it that far...
True story. In 1985 I'm a college student hanging out with friends and trying to impress some girls. We go to a Shopko because one of the girls wants to buy a birthday card. This takes far longer than it should because being America there are hundreds of cards from which to choose. Demonstrating my geopolitical brilliance, I quipped, "If this were the Soviet Union we would have one choice of card and we'd be done shopping."
Scarcity is what leftists do best. It is engrained in their pathology. We need to actively oppose this mindset and show there is a better way.
What does that Josh Barro quote have to do with your meme? I checked out your link containing a transcript and searched for "supply", "demand", "restrict" & "subsidize" and didn't find anything.
Restrict Supply Subsidize Demand works very well with health care, higher education, and houses, no reason it can't work with baby formula.
This is such a great concept. Illuminated a lot of policy decisions for me. I’ll do some R&D on it: Rip off and Duplicate. thanks
"replacement level progressive takes"
I just have to say I love this phrase.
Isn't the entire problem with progressivism that it is replacement level.
With regard to email micropayments to kill spam, you could even set up the system in such a way that recipients keep the cash. So you'd effectively attach 0.001 cent to email you send out and recipients would keep the cash, and use it when they in turn send emails. For the vast majority of people, this would balance out, give or take a couple bucks a year.
Of course, you would see advertisers for the most valuable products willing to attach large sums (maybe $0.01!!!) to mails to their most valuable customers. Spammers though would be screwed.
Yes, Arnold, you didn't start Public Choice but you should take credit for a great meme. Many government interventions in markets for goods and services amount to restrict supply and subsidize demand (others amount to either restrict supply or subsidize demand). Unfortunately too many economists still ignore Public Choice and your meme because they want to serve their present or future political bosses.
https://www.niskanencenter.org/cost-disease-socialism-how-subsidizing-costs-while-restricting-supply-drives-americas-fiscal-imbalance/
Cost disease socialism. Oh dear.
they write as if government is the solution, rather than the cause, of "cost disease." They don't appreciate the Public Choice aspect.
I read just the introduction, not the full report, but it appeared to me that they were saying that the political pressure to subsidize demand becomes stronger and stronger as supply is restricted; so, politically, the only hope is to defeat the political forces of supply-restriction. If the latter are allowed to prevail, the pressures for demand-subsidization will prove irresistible.
It seems to me that the 'Public Choice' problem is driven by the classic issue that the benefits of supply-restriction flowing to a monopsony are going to be fiercely protected while the costs of the demand-subsidy are born by a diffuse populace that is difficult to organize to eliminate it. In the formula case, the single source WIC contracts provide the supply restriction. This drives people who need formula to demand a greater subsidy as prices rise (I saw a stat that half of all infants in the US are eligible for WIC!) rather than agitate for an end to the single source contract, coupled with the fact that nobody else is bothered sufficiently (who wants to be tagged as being against feeding babies?) to try to end it, either.
And yes, the answer is government action .. end the sole source contract!
Government action--which, according to Public Choice, is very unlikely. The Niskanen report should go one step further: as they say, the key to improving the situation is to defeat the supply-restricters; but the latter are a concentrated interest group which will very likely prevail. In short, defeatism.