Tuesday, January 29, 2002
THE LIGHTHOUSE
THE LIGHTHOUSE
"Enlightening Ideas for Public Policy..."
VOL. 4, ISSUE 4
January 29, 2002
-------------------------------------------------------------
IN THIS WEEK'S ISSUE:
1. Enron and the Influence Peddlers
2. Farmers and Pork
3. The Legacy of Robert Nozick
--------------------------------------------------------------
ENRON AND THE INFLUENCE PEDDLERS
Enron's bankruptcy, say campaign-finance reformers, underscores the
need to limit private money donations to political campaigns. With
Enron having contributed to most members of the U.S. Senate,
investigations into the energy giant's influence-buying are easily
justified.
Enron, for example, stood to gain from the Kyoto Accord on global
warming and heavily lobbied the Clinton administration to authorize
the Environmental Protection Agency to regulate carbon dioxide
emissions, which would have brought us one step closer to adopting
the accord. Did lobbying by Enron result in a stronger EPA?
Campaign-finance reformers err, however, by focusing on the tree of
special-interesting politicking while overlooking the forest of
political influence peddling. Lobbying happens only because
politicians have favors to sell; reduce their favor-selling power and
you reduce the incentive to lobby.
President Clinton's 1996 campaign, for example, received $100,000
from Enron after he helped the company secure more than $600 million
in financing from the Export-Import Bank and $1 billion from the
Overseas Private Investment Corporation to subsidize such disasters
as Enron's ill-fated power plant in India. However, without agencies
such as the Ex-Im Bank and the OPIC to provide corporate welfare,
campaign contributions would not prompt such controversy.
Moreover, much of what looks like favor-seeking by private interests
is actually tribute-seeking by politicians, explains economist Fred
S. McChesney in the current issue of The Independent Review.
"Even when rent extraction is recognized as part of a politician's
arsenal [e.g., via implicit threats of new taxes or regulations], the
standard arguments against campaign-finance reform still apply,"
writes McChesney.
Campaign-finance reformers, and others taken aback by Enron's
political contributions, should therefore focus on curtailing the
power of government officials to sell favors. This would limit both
demand-driven favor seeking and supply-driven favor selling.
See 'Pay to Play' Politics Examined, with Lessons for
Campaign-Finance Reform" by Fred S. McChesney
Also see:
"After Kyoto: A Global Scramble for Advantage" by Bruce Yandle (THE
INDEPENDENT REVIEW, Summer 1999)
"Even After Enron, Energy Markets Thrive" by Robert J. Michaels (USA
TODAY, 12/10/01)
--------------------------------------------------------------
FARMERS AND PORK
As further evidence that politicians have too much power to sell,
consider the Daschle-Harkin farm bill. Most of its $73.5 billion in
new farm subsidies go to only the wealthiest 10 percent of farmers.
The problem, however, is not that the bill favors rich farmers rather
than all farmers equally; it's that it favors farmers at the expense
of consumers and taxpayers. Add $73.5 billion to the $98.5 billion
the bill earmarks for current farm programs, and you get a sum that
approaches the scandalous savings and loan bailout of the late 1980s.
Farm subsidies have become so entrenched that even alternative farm
bills that are intended to roll back "farm subsidies as usual," such
as Sen. Richard Lugar's, must offer sizable farm subsidies to be
politically viable. Politicians should never have been given the
power to subsidize farms in the first place, as this problem was
easily anticipated.
Earlier generations of policymakers could have expected the farm
price supports, and other subsidies, they planted to grow into the
dense thicket that today's reformers have little hope of pruning. And
yet these programs began long before the era of huge "soft money"
campaign contributions. As the farm fiasco illustrates, politicians
don't need special contributions to rationalize the robbing of City
Slicker Peter to pay Farmer Paul. They just need the power to grant
special favors to reward their constituents for returning them to
office.
For more on farm policy, see AGRICULTURE AND THE STATE: Market Processes and Bureaucracy, by Ernest C. Pasour, Jr. (The Independent Institute)
Also see Also see: Randal Rucker's review of PLOWING THE GROUND IN WASHINGTON: The Political Economy of U.S. Agriculture, by B. Delworth Gardner (THE INDEPENDENT REVIEW, Summer 1997)
-------------------------------------------------------------
THE LEGACY OF ROBERT NOZICK
The death of Harvard University philosopher Robert Nozick last week
is a sad occasion but an appropriate one for recalling the major
positive impact of his 1974 book, ANARCHY, STATE AND UTOPIA.
It is impossible to appreciate the importance of Nozick's National
Book Award-winner without understanding the extent to which
collectivist assumptions had drowned out the voices of individualism
and liberty in college philosophy departments. In short, Nozick's
treatise made academicians take rights and liberty seriously. As
Charles Rowley wrote in THE INDEPENDENT REVIEW:
"In 1974, Robert Nozick challenged the most commonly held political
and social positions of that time -- liberal democrat, socialist, and
conservative -- by reasserting that individuals have rights and that
there are things no person or group may do to them without violating
their rights. So strong and far-reaching are these rights that they
raise the question of what, if anything, the state and its officials
may do.
"Nozick's main conclusions were that a minimal state, limited to the
narrow functions of protection against force, theft, and fraud, and
concerned with the enforcement of contracts, is justified; that a
more extensive state must violate individuals' rights to do certain
things, and is unjustified; and that the minimal state is *inspiring*
as well as right. Two implications are that the state may not use its
coercive apparatus to (1) require some citizens to aid others or (2)
prohibit individuals from certain activities for their *own* good or
protection."
The academic uproar of Nozick's pro-liberty treatise was followed
years later by an uproar of many of Nozick's supporters, who believed
their silver-haired knight had abandoned the cause. Exhibit A was
Nozick's legal action in the mid 1980s against his landlord (Erich
Segal of LOVE STORY fame) in rent-controlled Cambridge, Mass.,
interpreted by some as opposition to private property rights. Exhibit
B was Nozick's declaration of support (in his 1989 book, THE EXAMINED
LIFE) for the "zigzag" of democratic politics over political
principles.
Nozick himself, however, said in a 2001 interview that he had never
left the pro-freedom camp. "What I was really saying in THE EXAMINED
LIFE was that I was no longer as hardcore a libertarian as I had been
before. But the rumors of my deviation (or apostasy!) from
libertarianism were much exaggerated."
Regardless, any late-term deviation, softening or zigzagging would
likely have been irrelevant to Nozick's long-run influence. Keynes,
for example, is alleged to have repudiated parts of Keynesianism
before his death, but it was full-bodied Keynesianism and not a
brief, whispered repudiation that spread to the world's economics
classrooms and government treasury departments. Similarly, it is
Nozick's ANARCHY, STATE AND UTOPIA and not his later work that is
widely read. Already, a generation of pro-freedom philosophers has
passed through the academic door opened by Nozick. His legacy is
already being felt.
See "Harvard Philosopher Robert Nozick Dies at 63" (Harvard
University Press Release)
Robert Nozick's work is discussed in:
"What is Living and What is Dead in Classical Liberalism?" by Charles
K. Rowley (THE INDEPENDENT REVIEW, Summer 1996)
-------------------------------------------------------------
THE LIGHTHOUSE, edited by Carl P. Close, is made possible by the
generous contributions of supporters of The Independent Institute. If
you enjoy THE LIGHTHOUSE, please consider making a donation to The
Independent Institute. For details on the Independent Associate
Membership program, see
http://www.independent.org/tii/tii_info/associat.html or contact Mr.
Rod Martin by phone at 510-632-1366 x114, fax to 510-568-6040, email
to , or snail mail to The Independent
Institute, 100 Swan Way, Oakland, CA 94621-1428. All contributions
are tax-deductible. Thank you!
-------------------------------------------------------------
For previous issues of THE LIGHTHOUSE, see
http://www.independent.org/tii/lighthouse/Lighthouse.html
-------------------------------------------------------------
For information on books and other publications from The Independent
Institute, see
http://www.independent.org/tii/pubs.html
|
 |
| | |
| |
 |
