Monday, January 9, 2012

The Government Subsidy Fallacy

Lyndon Baines Johnson Department of Education ...
No Federal Department Left Behind

Just because you don’t think the government should do it, doesn’t mean that you’re against it.
David Henderson points out a Bastiat insight in this blog post that I, as well, find frustrating.  This is from Bastiat’s What is Seen and What Is Not Seen:
When we oppose subsidies, we are charged with opposing the very thing that it was proposed to subsidize and of being the enemies of all kinds of activity, because we want these activities to be voluntary and to seek their proper reward in themselves.
Henderson then shares a technique he uses in his economics class to illustrate this:
When I teach this article in class, I ask the students, who are almost all American, how many of them favor having government subsidize religion or requiring that people be religious. Typically no one raises his hand. Then I say:
Wow! That’s really something. I’m going to go home tonight and say to my wife, “Babes, I have a class of 25 people and all of them are atheists.” Did I get that right? Am I leaving something out?
The classic example of this is the Federal Department of Education.
Mention that we should get rid of it and — despite the fact that since its establishment per student, inflation-adjusted spending on public education has tripled while declining in quality, despite the fact that DC driven education accountability has proven not work (not under this guy, that guy, or that one) and the best accountability is parents, despite the common sense view that sending our money to Washington to have bureaucrats give it a hair cut and then send it back to our schools doesn’t make sense — you will likely be accused of being against education.
When actually, it’s just the opposite.

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