clipped from www.townhall.com
Stupid, Ignorant or Biased? President Franklin D. Roosevelt's closest adviser and architect of the New Deal, Harry Hopkins, advised, "Tax and tax, spend and spend, elect and elect, because the people are too damn dumb to know the difference." Professor Bryan Caplan, my colleague at George Mason University, sheds some light on Hopkins' observation in his new book, "The Myth of the Rational Voter: Why Democracies Choose Bad Policies."
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FDR perfected the idea of buying votes, but never paid the cost because he was smart enough to use devices like Social Security that wouldn't explode until decades after his death, and he was lucky enough to have WWII to end the depression. The full article here is WELL worth reading so I'll copy it in, and it looks like the book will be as well.
We live in a country where the advantages of market vs government control and greater individual responsibility and choice are very evident. We don't need to take our own experience, we can look at England, Ireland, China, India, Japan, Hong Kong, Singapore and others and see the same rules play out. No small set of people in a centralized government can be as smart as the votes of millions and billions of people acting in a market. One wouldn't think that actually required as much thought as it seems to, but apparently it does. Since most of the basic biases discussed here are simply liberal biases and the MSM tends to agree with that point of view, the general public hears them stated as "fact" day in and day out.
President Franklin D. Roosevelt's closest adviser and architect of the New Deal, Harry Hopkins, advised, "Tax and tax, spend and spend, elect and elect, because the people are too damn dumb to know the difference." Professor Bryan Caplan, my colleague at George Mason University, sheds some light on Hopkins' observation in his new book, "The Myth of the Rational Voter: Why Democracies Choose Bad Policies." Caplan is far more generous than Hopkins. Instead, he says people harbor economic biases, several of which he discusses. There's the anti-market bias, the failure to believe that market forces determine prices. Many believe that prices are a function of a CEO's intentions and conspiracies. If a CEO wakes up feeling greedy, he'll raise prices. They also believe that profits are undeserving gifts. They fail to see that, at least in open markets, profits are incentives for firms to satisfy customers, find least-cost production methods and move resources from low-valued to high-valued uses.
Caplan is one of George Mason University Economics Department's up-and-coming young scholars. In fact, I'm proud to say, he was hired during my department chairmanship. "The Myth of the Rational Voter: Why Democracies Choose Bad Policies" is a highly readable and interesting political-economic discussion of why we choose bad policies. Those policies are harmful to the general public but beneficial to particular interest groups who gain from restrictions on peaceable, voluntary exchange. Maybe that's why our founders loathed a democracy and gave us a republic -- which we've lost. |