Abraham Lincoln on the Theory of Public Choice
By David Henderson
We then, do not say, nor need we say, to maintain our proposition, that Bank officers are more honest than Government officers, selected by the same rule. What we do say is that the interest of the Sub-Treasurer is against his duty–while the interest of the Bank is on the side of its duty. Take instances–a Sub-Treasurer has in his hands one hundred thousand dollars of public money; his duty says–“You ought to pay this money over”–but his interest says, “You ought to run away with this sum, and be a nabob the balance of your life.” And who that knows anything of human nature, doubts that, in many instances, interest will prevail over duty, and that the Sub-Treasurers will prefer opulent knavery in a foreign land, to honest poverty at home? But how different it is with a Bank. . . . Its interest therefore is on the side of its duty–is to be faithful to the Government, and consequently, even the dishonest amongst its managers, have no temptation to be faithless to it.
This is from a speech given by Abraham Lincoln on December 26, 1839 in Springfield, IL.
I highlight it because it’s on the back cover of the June 1993 issue of the Journal of Political Economy. From sometime in the 1970s to sometime in the 1990s, the JPE had a quote on the back cover of virtually every issue. I once suggested one that got used. This one was suggested by Milton Friedman.