Subsidies and Regulation

Before I begin, I would like to congratulate the staff, supporters, and readers of REPUBLIC MAGAZINE for the incredible impact they have had on our society. Someone approached me recently and said, “Hey! You’re the guy who writes for Republic Magazine!”. I assured him that I was merely one of several writers and activists who dedicate their time and talent to what I consider the modern version of Thomas Paine’s “Common Sense”. Before we can change the way our government operates, we have to alter the opinions of our fellow Americans by appealing to their common sense and rational self-interest. Distributing thousands of copies of this magazine is successfully doing exactly that. If you are reading these words you will be thrilled to learn that you are far from being alone. If you find yourself wishing you could do more to fight for Liberty, I suggest handing out several hundred copies of this magazine to people who are still unaware of the tyranny we face.



This month’s theme is alternative energy. My resume’ documents twelve years spent working in the nuclear industry, however I won’t be extolling the virtues of pressurized water reactors. (Not unless the editors grant me an additional 2000 words in a future issue. :) ) For the moment I will limit my comments to what the constitution conspicuously doesn’t say about alternative energy.

Perhaps the two most misunderstood and congressionally abused phrases in the constituton are the “general welfare” (1.8.1) and the “interstate commerce” (1.8.3) clauses. The former is misinterpreted to justify entitlement clauses for individuals, while the latter is misinterpreted to justify welfare at the corporate level. Both are huge drains on our economy, and both are repugnant to the constitution.

We pay lip service to ideas like free market economy and level playing field, but it is apparent to a growing percentage of the population that those concepts are nothing more than slogans. America (and the world) is watching in shock and awe as our politicians pretend to justify last year’s trillion dollar bailout, this year’s double-trillion dollar stimulus package, and next year’s triple-trillion dollar budget – as if anything with twelve zeros to the left of the decimal point can be called a budget with a straight face.

This economic train wreck did not explode onto the scene overnight. For those who survive the financial meltdown, it would be prudent to understand the genesis of the monster now before us. Government invariably uses a carrot and a stick to tilt the level playing field in favor of one or more players of the game.

The carrot strategy provides subsidies to selected players, allowing them to offer their goods or services at lower prices, thus making competition a relative term. Amtrak would have disappeared long ago without a constant influx of government money. American gasoline prices are significantly lower than other countries because our oil industries are subsidized by a Congress whose campaigns have been greased by Chevron and Exxon since long before any of today’s readers were alive. Immigrant workers can survive working for a few dollars an hour, but only because their housing, food, medical care, and children’s education are subsizided by a government extremely generous with your money.

The stick in this analogy is stringent regulation. Laws that “protect society” are dreamed up by large institutions because they know that smaller competitors cannot afford expensive compliance standards. Forcing small businesses to install handicap friendly modifications is often expensive, and occasionally ridiculous. One California restaurant had a wheelchair ramp leading down to the beach. WHY?! How far is someone in a wheelchair going to travel in the sand? What’s next? High wire in triplicate for people with crutches?

During my presidential campaign I criticized the government’s long term subsidies for the oil and automotive industries. Someone asked me what energy alternatives the government should be subsidizing. “NONE!”, I shouted to someone who clearly shared the government’s definition of “free market”. In the tug of war for your consumer dollars, the constitution forbids the government from taking sides.




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