Thursday, June 6, 2013

If you're paying, I'll have top sirloin

This brilliant Russ Roberts essay, copied from here, explains why costs don't go down once government is involved in an industry - Education, Healthcare, Defense, Infrastructure, or anything else. 

Because if you're paying, and I don't know you, and I'm not likely to ever meet you, I'm having top sirloin.  And a loaded baked potato with two appetizers.  And let's bring out that pint of Crown Royal to chase it with, shall we?  Here's Mr. Roberts:

As Congress prepares to try to cut spending, I am reminded of an evening last fall at the St. Louis Repertory Theater, our local company. Before the curtain rose, the company's director appeared and encouraged us to vote against a ballot proposition to limit state taxes. He feared it would lead to reduced funding for the company.
I turned to the woman sitting next to me and asked her if she felt guilty knowing that her ticket was subsidized by some farmer in the "boot-heel" of Missouri. No, she answered, he's probably getting something, too. She seemed to be implying that somehow, it all evened out.

I left her alone, but I wanted to say, no it doesn't even out. If it "evened out" for everybody, then government spending would really be depressing: all that money shuffled around, all those people working at the IRS, all those marginal tax rates discouraging work effort just to get everybody to get the same deal.

Here in St. Louis we recently completed Metrolink, a light rail system. It cost $380 million to build. We locals contributed zero out of pocket. It was paid for by the rest of the country. Shouldn't we feel guilty making people in Kentucky, Mississippi and Maine pay for our trips to the hockey arena downtown? No, say the beneficiaries. After all, we paid for BART in San Francisco and MARTA in Atlanta and all the other extraordinarily expensive, underutilized public transportation systems whose benefits fall far short of their costs. It's only fair we get our turn at the trough.

This destructive justification reminds me of a very strange restaurant.

When you eat there, you usually spend about $6—you have a sandwich, some fries and a drink. Of course you'd also enjoy dessert and a second drink, but that costs an additional $4. The extra food isn't worth $4 to you, so you stick with the $6 meal.

Sometimes, you go to the same restaurant with three friends. The four of you are in the habit of splitting the check evenly. You realize after a while that the $4 drink and dessert will end up costing you only $1, because the total tab is split four ways. Should you order the drink and dessert? If you're a nice person, you might want to spare your friends from having to subsidize your extravagance. Then it dawns on you that they may be ordering extras financed out of your pocket. But they're your friends. They wouldn't do that to you and you wouldn't do that to them. And if anyone tries it among the group, social pressure will keep things under control.

But now suppose the tab is split not at each table but across the 100 diners that evening across all the tables. Now adding the $4 drink and dessert costs only 4¢. Splurging is easy to justify now. In fact you won't just add a drink and dessert; you'll upgrade to the steak and add a bottle of wine. Suppose you and everyone else each orders $40 worth of food. The tab for the entire restaurant will be $4000. Divided by the 100 diners, your bill comes to $40. Here is the irony. Like my neighbor at the theater, you'll get your "fair share." The stranger at the restaurant a few tables over pays for your meal, but you also help subsidize his. It all "evens out."

But this outcome is a disaster. When you dine alone, you spend $6. The extra $34 of steak and other treats are not worth it. But in competition with the others, you've chosen a meal far out of your price range whose enjoyment falls far short of its cost.

Self-restraint goes unrewarded. If you go back to ordering your $6 meal in hopes of saving money, your tab will be close to $40 anyway unless the other 99 diners cut back also. The good citizen feels like a chump.

And so we read of the freshman Congressman who comes to Congress eager to cut pork out of the budget but in trouble back home because local projects will also come under the knife. Instead of being proud to lead the way, he is forced to fight for those projects to make sure his district gets its "fair share."

Matters get much worse when there are gluttons and drunkards at the restaurant mixing with dieters and teetotalers. The average tab might be $40, but some are eating $80 worth of food while others are stuck with a salad and an iced tea.

Those with modest appetites would like to flee the smorgasbord, but suppose it's the only restaurant in town and you are forced to eat there every night. Resentment and anger come naturally. And being the only restaurant in town, you can imagine the quality of the service.

Such a restaurant can be a happy place if the light eaters enjoy watching the gluttony of those who eat and drink with gusto. Many government programs generate a comparable wide range of support. But many do not. How many Americans other than farmers benefit from the farm subsidy programs? How many Americans other than train riders derive benefit from the Amtrak subsidy?

People who are overeating at the expense of others should be ashamed. That shame will return when others are forced to cut back too. This requires deep cuts and an end to the government smorgasbord where the few benefit at the expense of the many.

TANSTAAFL.  There ain't no such thing as a free lunch.  And thanks for paying!! 


Tudor said...

Hail oh Whited Sepulchre!

I love the new look of the blog, but it is REEEEEAAAAAALLLYY slow to try and scroll down and navigate, making the site unreadable/unbearable

Maybe the background or some widget is slwoing everything down to like it's 1997 or something?


Peace out.

Tudor said...

Yep, the comments pages are all fine.

I even tried clicking on separate news items and each of those pages is deathly slow too.

So, my guess the background or something you altered during the reboot.

And no, it's not my computer - I checked several other pages and they're all loading up fine :P

HTH x2

The Whited Sepulchre said...

Thanks for the info. I'm having a similar problem!! Plus, the text keeps changing sizes.

Anonymous said...

this is John Rambo, Anti-Feminist Soldier. I am posting this on behalf of Peter-Andrew: Nolan© also now known as Joschua-Brandon: Boehm©. I am doing this because, as a young men who knows Peter well, I know he has our best interests at heart.

It is well known that five years ago, April 2008, I spent a month suicidal as I went through the process of disowning my former children. When I came out of that rather unpleasant experience I contacted other men who had been similarly affected. I realized that many men were killing themselves because of the criminal abuse of the family law courts all across the western English speaking world.

As a direct result of this experience, and my compassion for my fellow men, I made a vow in June 2008 to re-introduce the rule of law into Australia and Ireland. Naturally, at the time I made the vow I had no idea how that might be done. We call it “throw your hat over the wall”. You make the vow and “figure it out later”.

Along the way I have talked to many tens of thousands of men, perhaps as many as 100,000 men have seen at least one comment by me one way or another. What I heard from men in 2008 was that they were DESPERATE for a remedy for the crimes being committed against them in the family courts. They were DESPERATE to find a way to end the criminal effects of feminism on their lives. Because so many men told me the same thing I mistook this to mean they actually WANTED to solve the problems of the family courts and feminism. As I said. My mistake.

Through very extensive research and labour, and collaborating with the best and brightest, the remedy for both the family courts and feminism was proven on 2009-11-26. A mere 18 months after I was suicidal. The court meeting that I did on 2009-11-26 I regard as one of the finest achievements of my life. Regardless? The very men I risked my life to create a remedy for have ignored that remedy, preferring to whine, bitch, moan and complain because that is far more rewarding to them than actually solving their problems. If they solved their problems they would have nothing to whine, bitch, moan and complain about.

The remedy has now been available 2.5 times as long as it took to develop and has proved uniquely unpopular. I am hated for even talking about it. The blood of every man who kills himself due to criminal abuse in the family courts is on the hands of those perhaps 100,000+ men who have heard from me and done nothing. I did all I could. They did not. It is actually very simple.

The mechanism for men to free themselves now is the Mens Business Association. The MBA provides individual based services to get men out of the control grid. Such services may well save the mans life from suicide. Going forward? It is necessary to create second economy outside the control of any government entity. Why criminals in governments can dominate and control men via the economy they will continue to do so. There is no reason for them to stop. The MBA is the proposal of a second economy outside the control of the government. This is a NECESSARY ingredient for men to live in freedom.

Only a small percentage of men will want to live in freedom. Those men who want to live in freedom? You are invited to watch a short update on how we are going in our efforts to get the second economy going. Naturally? The second economy will grow just as quickly or slowly as men join in and contribute to it. Those who want to “stick with the government run economies”? You are welcome to do so. I wish you luck with that because you are going to need it.

best regards

your brother peter

ukfred said...

This all goes to show that for the best value for money and spending on the right items,

Best is I buy for me with my money
Next is I buy for someone else with my money
Third is someone else buys for me with my money
Last is someone else buys for a thrid party with my money.

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