A story in this morning’s Wall Street Journal follows up on the EU government’s actions in the face of “Russia” (i.e. Putin’s Russian state) cutting gas supplies to European customers. The article contains some some confused statements and some sound points from a narrow economic viewpoint, but that is not what I want to focus on. (See my more mainstream post of yesterday on the same topic.) I will instead underline what I think is a general result of in the economic analysis of politics.
The WSJ writes (“Europe Agrees to Cut Gas Consumption as Russia Crimps Supplies,” July 26):
“Governments haven’t done a good job at preparing the public for these kinds of demand-saving measures,” said Natasha Fielding, analyst at Argus Media.
I wonder where Ms. Fielding has been living or what she has read about the past century or century and a half—and longer if we want to reach to Alexis de Tocqueville‘s premonitions about the soft tyranny of future democratic regimes. Governments have done whatever they could without open violence, and often with sanctimonious open violence, to accustom individuals to being dependent upon, trustful of, and addicted to their political and bureaucratic masters. “Citizens” often tell pollsters that they mistrust the current government in power, but they deify the state as it should be and as it would be if and when the democratic crowd or the plebiscitic strongman espouses their own views and interests. The failure to see how free-market prices could resolve heightened scarcity in the gas market is only an example among zillions.
READER COMMENTS
Thomas Lee Hutcheson
Jul 26 2022 at 12:04pm
No, regulation that is not guided by cost benefit analyses can reduce real growth, but unless done secret, in such a way as the Fed cannot take into account, it cannot produce a recession. If anything a secret or under-appreciated supply-reducing regulatory shock would lead to above target inflation, not below-target employment.
Pierre Lemieux
Jul 26 2022 at 4:17pm
Thomas: Posted on the wrong blog post?
Thomas Lee Hutcheson
Jul 26 2022 at 12:11pm
The failure to see how free-market prices could resolve heightened scarcity in the gas market is only an example among zillions.
And this this post that does not actually explain or advocate for how policy could move toward “free market” prices is only and example among zillions. “)
Pierre Lemieux
Jul 26 2022 at 4:22pm
Thomas: I try to adopt a constitutional political economy approach, that is, I am interested in broad “constitutional” rules, not in whether the government (flectamus genua) should subsidize bubble gum and tax hula hoops, or the other way around. From a different viewpoint, as I think Buchanan said (my eternal gratitude to whom will find a citation), I am trying to advise citizens, not statocrats.
Mactoul
Jul 26 2022 at 10:42pm
And your broad constitutional rule is that political action is only valid if supported by all citizens. Thus ruling out all politics.
Pierre Lemieux
Jul 27 2022 at 10:40am
Mactoul: Perhaps the jury is still out on whether or not all politics can or should be ruled out, but it is important to understand James Buchanan’s argument to the effect that unanimity does not rule out politics. In short (in very short): the unanimity requirement applies only to the rules that guide and constrain politics. This argument is complex and seductive. See my review of Buchanan’s Why I, Too, Am Not a Conservative and of his classic with Gordon Tullock, The Calculus of Consent. The question is, How can politics can be as non-exploitative as possible?
Comments are closed.