The biggest myth about government is that it serves “the public interest.” But there is no such thing as “the” public interest. In order for any government policy to be “in the public interest,” there would have to be unanimous agreement; otherwise, part of the public wins while another part loses.
Only in the free market, where buyers and sellers mutually agree on the terms of a deal, is there unanimous agreement over the allocation of resources.
Democratic politics is never unanimous, and is therefore never truly in “the public interest” despite all the rhetoric to the contrary.
Government is in the business of catering primarily to well-organized special interests while spreading the costs of government (i.e., taxes) across the entire taxpaying population. Special interests are well-organized politically, whereas the general public is not, which is why the former group always prevails. Few state legislatures, moreover, are more egregious in pandering to special interests than Maryland?s.
A case in point is the state legislature?s recently passed “Wal-Mart bill,” which forces the company to spend more of its revenues on things the politicians in Annapolis think it should be spending it on (health insurance), in fine fascist fashion. (Fascism was an economic system whereby private property was permitted, but its use was strictly regimented and controlled by government authorities, supposedly “in the public interest”).
The Wal-Mart bill is nothing but a transparent sop to a particularly strong special interest group in Maryland ? labor unions ? at the expense of Maryland consumers (and especially Wal-Mart employees).
The reason there is such a large propaganda campaign against Wal-Mart ? and not Target, K-Mart or other similar enterprises ? is that Wal-Mart has very successfully entered the grocery business and charges as much as a third less for groceries compared to unionized grocery chains like Giant or Safeway. Therefore, the United Food and Commercial Workers Union (UFCW), among others, have “targeted” the company with what is called a “corporatecampaign.”
The purpose of such “campaigns” is to drive up the costs and scare away the customers of nonunion companies ? or drive them out of business altogether ? so that unionized companies can monopolize their markets and continue to charge higher prices. It is essentially a legal price-fixing conspiracy. (It?s legal because unions are exempted from antitrust laws). Thanks a lot, Maryland legislature.
This is an old tactic on the part of unions. For example, at a 1990 UFCW conference the executive vice president of the union, Douglas Dority, announced that the “biggest problem” facing his union was “nonunion stores.” The “problem” is that nonunion stores are always lower-priced, which takes customers away from the unionized grocery chains, and diminishes the union?s ability to increase wages and prices even further. Consequently, Dority said, his union must “either reduce these chains? market share ? or we must put them out of business.” “We have shown we can hurt them with picket lines and bad publicity,” he added.
Another goal of the unions is to go over the heads of the employees of a company like Wal-Mart (who do not want to be unionized) and do enough damage to the company with its negative campaigning and lobbying for “Wal-Mart bills” so that management will sign a union contract without even involving the employees. As another UFCW official, Tom McNutt, said in a Regardies magazine interview, the objective is “to either eliminate them or get them to surrender to the union.” The management of unionized grocery chains are complicit in this anti-consumer conspiracy, as they are more than happy to assist the unions in their attacks on their lower-priced competitors.
If successful, the campaign against Wal-Mart would result in what is effectively a very regressive “tax” on consumers: Higher grocery prices would burden lower-income consumers proportionately more than more affluent consumers. It would also reduce job creation in the state.
Wal-Mart has already voiced second thoughts about opening up two large distribution centers in the poorest parts of the state because of the anti-business attitude of the state legislature. This has not gone unnoticed by other businesses all across America.
Don?t be fooled by the phony “public interest” rhetoric coming out of Annapolis.
Thomas DiLorenzo is professor of economics at Loyola College; the author of “How Capitalism Saved America: The Untold History of Our Country, from the Pilgrims to the Present” (Crown Forum/Random House, 2004); and a member of The Examiner?s editorial board.
