June 6, 2016
Acute vs. Chronic Harm
ThreeSourcers are familiar with the fact that concentrated interests, i.e. special interest lobbying groups, have an advantage when lobbying government over diffuse interests, i.e. individual taxpayers. A similar inequality [yes, I admit the gratuitous use of a leftist dog whistle term - anyone think it will prompt the righteous indignation that is due? - me neither] exists in the harm done to commerce by government.
Americans for Prosperity's Brent Gardner writes in a WSJ piece that multinational corporations are well situated to demand and receive special treatment from government. On one hand I support such behavior, on the grounds that government should not be taxing corporations in the first place. But government should not be taxing mom and pop businesses either, and they have less leverage to fight the (equal) injustice.
To coin a phrase, the harm to a large company is often acute where the harm to thousands of small companies is chronic. Large companies are often unable to pursue a particular market without these special carve outs. Not only can they do something about it, they have the accounting and business development wherewithal to be aware of it in the first place. Many entrepreneurs simply wonder why its so hard to keep the doors open. One large hint: Taxation.
But the villain in this story is not multinational corporations, nor any large business. It is the government who favors them in naked surrender to the power of their concentrated interest. Gardner:
If state and local lawmakers are truly interested in spurring job creation and economic growth, they have better options than handing out taxpayer money to a lucky few.
Readers will note that the entire excerpt starts with the word "if."Economics and Markets Government We're from the government, and here to help. Posted by JohnGalt at June 6, 2016 2:52 PM