Wednesday, June 5, 2013

The IRS, The DOJ, The FDA, and Milton Friedman's Barking Cat

Why are people surprised that the IRS targeted groups that want a smaller IRS? 

Why do almost half of us think that Obama is lying when he says he didn't know that the IRS was targeting groups that want a smaller IRS? 

If you worked for the IRS, and had a great salary, would you want a larger IRS or a smaller IRS?  Would you use your power to intimidate people who wanted a smaller IRS?  Unless your name is Gandhi or Jesus, you would do exactly and precisely what the IRS did.  You would target your enemies. 
Almost half of Americans say President Barack Obama isn’t telling the truth when he says he didn’t know the Internal Revenue Service was giving extra scrutiny to the applications of small government groups seeking tax-exempt status.

.Forty-seven percent of Americans say they don’t believe Obama compared with 40 percent who say he is being truthful, according to a Bloomberg National Poll of 1,002 adults conducted May 31 through June 3.

More than half of political independents -- 53 percent -- say Obama’s explanation that he learned it from media reports is untrue, while 34 percent say they believe him.
Why is this even called a "scandal"?  It's.... what.... large.... powerful.... governments..... do. 

1) They protect themselves and their families. 
2) They protect their organization.
3) Then they look out for you. Maybe.  All other considerations are in a distant 3rd place. 

To expect an honest, selfless system of angelic revenue thieves is to demand what Milton Friedman called a "Barking Cat".  Friedman used the example of the FDA slowing down pharmaceutical advancement, but you can insert FBI, CIA, Tarrant Regional Water District, VA Hospital, or any other government organization that has the power to control others.
Friedman got a letter that began as follows: "In contrast to your opinion, I do not believe that the FDA should be abolished, but I do believe that its power should be" changed in (such and such a way)....

Friedman replied as follows: "What would you think of someone who said, " I would like to have a cat, provided it barked"? Yet your statement that you favor an FDA provided it behaves as you believe desirable is precisely equivalent. The biological laws that specify the characteristics of cats are no more rigid than the political laws that specify the behavior of governmental agencies once they are established. The way the FDA now behaves, and the adverse consequences are not an accident, not a result of some easily corrected human mistake, but a consequence of its constitution in precisely the same way that a meow is related to the constitution of a cat. As a natural scientist, you recognize that you cannot assign characteristics at will to chemical and biological entities, cannot demand that cats bark or water burn. Why do you suppose that the situation is different in the "social sciences?"

The error of supposing that the behavior of social organisms can be shaped at will is widespread. It is the fundamental error of most so-called reformers. It explains why they so often believe that the fault lies in the man, not the "system," that the way to solve problems is to "throw the rascals out" and put well-meaning people in charge. It explains why their reforms, when ostensibly achieved, so often go astray.

The harm done by the FDA does not result from defects in the men in charge-unless it be a defect to be human. Most are and have been able, devoted and public-spirited civil servants. What reformers so often fail to recognize is that social, political and economic pressures determine the behavior of the men supposedly in charge of a governmental agency to a far greater extent than they determine its behavior. No doubt there are exceptions, but they are exceedingly rare-about as rare as barking cats.
This is what Big Government organizations do.  They abuse their power.  They look out for themselves.  In economics, it's called "Public Choice".  I understand the theory better than I do the name. 
As James Buchanan artfully defined it, public choice is “politics without romance.” The wishful thinking it displaced presumes that participants in the political sphere aspire to promote the common good. In the conventional “public interest” view, public officials are portrayed as benevolent “public servants” who faithfully carry out the “will of the people.” In tending to the public’s business, voters, politicians, and policymakers are supposed somehow to rise above their own parochial concerns.

Public "servants" look out for themselves before they look out for you.  And cats don't bark. 
Well, Friedman acknowledged that some cats might rarely bark, but only when they think none of their co-workers are watching. 

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