Friday, May 28, 2004

Dated May 28, 2004, 5:30 am

Eric Zorn, Chicago Tribune Columnist (Metro Section, P.1; online at, ends his interesting Thursday column on government employee pensions, with the question: for whose benefit does Government operate? [Qui Bono? Qui Costo?]

Of course, a certain amount of government involvement in our lives is benign, e.g., national defense-- that is, true public goods-- goods for which individuals A's consumption does not detract from individual B being able to consume it, as well, without any additional cost.[Even the libertarians might agree with this]. For example, a missile shield to protect Zorn's home in Albany Park can fairly easily protect mine in Winnetka, without any additional cost. Having Zorn, me and others buy a missile defense privately would result in too little missile defense in the aggregate when we look at the true benefits and costs. However, there are relatively few such true "Public goods," of the type just described. Education, for example, is not a true public good. We may still choose to subsidize, for a variety of reasons, education- but, most likely, to be efficent, we would have government finance, not provide, education. A very important distinction. One which would, of course, catch the ear and eye of the teachers' unions.

Instead, we find a great many programs in government that are neither appropriate as a government service nor run efficiently. Instead, they tend to more labor intensive than would be justified on efficiency grounds. This is simply because people vote, not capital or machines-- so politicians use the production process to win over votes by employing too many employees (that is, the government production process is too labor intensive). Look at Cook County, 27,000 employees, or so-- almost half of whom are under the discretion of Cook County Board President John Stroger. Even a Democrat, such as Cook County Board Member Forrest Claypool, would agree with me that Cook County Government is very bloated, especially on the employment side. Indeed, to be fair, I stole the word, bloated, from a Claypool campaign slogan.

Further, I think Democratic Cook County Board members Quigley and Suffredin would also agree with me about the bloat, as would Republican Cook County Board Members Hansen, Peraica, Silvestri, Gorman and Goslin. Indeed, President Stroger, who I doubt would agree with me, was defeated in his effort earlier this year to raise taxes to finance his bloated budget-- when Democrat Earlean Collins voted with the bi-partisan block of 8 aforementioned board members to knock the tax boost down, forcing Stroger to "find," some additional money in his Bloated Budget, without a tax increase. BTW, Collins is to the County Board what Kennedy and O'Conner are to the U. S. Supremes, that is, the swing vote-- and perhaps she might have the votes to become the next Cook County Board President, should John Stroger step down sometime in or after January, 2005.

Of course, the above waste on the County level is worse than the City of Chicago, if you can imagine, and much worse than a local village, but not as much as the State, which in turn, is not as bad as the Feds. Thus, the rationale for federalism. That government which governs least governs best. And, of course, the higher up on the food chain you go, the further from the people you go, and the more inefficent you get. Of course, almost always, the free market bring us closer to the individual than would government, making the free market preferred to government-- except, of course, when we have true public goods, which is where we started.

And, yes, as Barack Obama is wont to tell us, there are some cases of market failure. But, as we learned at the University of Chicago from Economics Nobel Prize Laureates Ronald Coase and Gary Becker, and recently on "Public Affairs," from Jack Ryan [See Blog entry, below, updated May 25 at 5:00 am], there are also instances of government failure. Indeed, Professor Gary Becker reminded us, "Demonstrating that a set of government decisions would improve matters is not the same as demonstrating that actual government decisions would do so." So, Eric, you have to ask, in any given instance, which is more likely to fail? The Government or the Free Market?

If we answer Eric's question that governments operate, in large part, for the people and pols in government, and the free market operates, in large part, for consumers, i.e., the people, I say, "Power to the people," or put another way, "All we are saying is, give [school] choice a chance." That is, on average, governments are more likely to fail than free markets. Indeed, we had a controlled experiment, of sorts-- The Soviet Union and the United States. QED.

BTW, folks, in an effort to pick up market share by good, clean, free and open competition, we will be blogging away this Memorial Day Week-end on this, your "Public Affairs," site. Check at least daily for stuff on Obama/Ryan; Antonio Davis Fairman/Danny Davis in the 7th; Fair and Balanced with Carol Marin; Fair and balanced with Chicago Tonight [a target rich environment for media critics]; Fair and Balanced with Fox and and oh, so much more.

Jeff Berkowitz, host and producer of "Public Affairs," can be reached at If you would like to receive an "email alert," telling you that we have posted a new Public Affairs blog entry and you are not currently receiving same, please send an email to with "Blog alert," in the subject matter and we will add you to our PA blog alert list.