Reno Hayek Symposium

Today’s (8/6/09) WSJ editorial page discussed Obama’s courtship of Republican Chuck Grassley’s vote on the Obamacare package. Seems like a straightforward persuasion attempt. But in a totally off-point issue, Grassley’s desire to support the flagrantly protective tariff against Brazilian sugar based ethanol in favor of the less effective corn ethanol supported by the tariff for his constituents, becomes the trading point, the political point, the unseen point of so-called “compromise.” The editorial hopes that Grassley won’t make Americans pay twice! Good luck!

There is no more common good. This ingrained political behavior is economically called “rent seeking.” For the fat cat corn growers the mandates and tariff bases price supports feed the revenue that would otherwise be non existent. Growers would otherwise need to get an honest, read “economic,” job. That’s too much trouble when the government is there to fund them! For the politicians, the Grassley’s of this world, this “rent seeking” is “contribution seeking” and ultimately “vote seeking,” to sustain them in office.

The Republicans are just as bad as the Democrats in this regard. Frank Murtha logically argues that if he didn’t get the earmark for his district some other Congressmen would get the money for his! It’s a way of life. I fear, it’s unchangeable. The lesson: join the rent seekers or perish? No, that’s not morally correct. That’s not competitive. That will not bring out the best! And, in the end, we will ultimately lose.

By the way, in the same August 6th WSJ, Chad P. Brown has a good op-ed called “Protectionism Exposed.” In it he touts a World Bank website which he helped organize that set outs the various protectionists measures which if unchecked will bring the demise to world trade. It’s worth the look.

Tom Motherway, tom@renohayek.com