The Silly Subsidies That Cost Us So Much
YOU probably never knew of the federal funding of museums commemorating America’s longgone whaling industry. The funding existed for nearly nine years, until 2011, because almost no one knew about it. A mohair subsidy continues six decades after it was deemed a military necessity in the context of the Cold War. The subsidy survives because its beneficiaries are too clever to call attention to it by proclaiming it necessary, which of course it isn’t.
To understand these two matters is to understand how American government functions. And why James Madison, whose flinty realism is often called pessimism, was too optimistic.
Federal funding went to whaling museums in three states from which whalers went to sea (Massachusetts, Alaska and Hawaii) and in Mississippi, which was not a home of whalers but is the home of Republican Sen. Thad Cochran, an Appropriations Committee titan. The whaling program, which cost about $9 million in its last year, was administered by the Department of Education. It objected to doing this, which is one reason the funding ended: Government changed because part of it was annoyed. Also, a congressman publicized the subsidy.
The $9 million was a piddling smidgen of a fraction of the federal budget, as is the $5 million wool and mohair subsidy. It was smuggled into the 1954 National Wool Act, which was supposed to stimulate wool production, lest we run short when next we need 12 million uniforms for a twofront world war. Mohair had nothing to do with this supposed military necessity, but mohair producers wanted a seat on the gravy train.
Their subsidy became briefly notorious and briefly died (it was resuscitated when no one was any longer paying attention) after Jonathan Rauch called attention to it in his 1994 book “Demosclerosis.” Rauch’s neologism describes government that is resistant to change because it is solicitous toward many minor but attentive factions.
These clients thrive in obscurity because of the law that governs much of government, the law of dispersed costs and concentrated benefits. Taxpayers don’t notice, unless someone like Rauch tells them, the costs of subsidizing whaling museums or mohair, but the subsidies mean much to those who run the museums or produce the mohair. Similarly, consumers do not notice the cost of sugar import quotas added to the sugar they consume, quotas that substantially enrich sugar producers. And so on and on.
This is why minorities constantly manage to milk money from majorities, which is not how Madison thought things would work. Greg Weiner, an Assump tion College political scientist, notes that in Federalist Paper 10 Madison confidently says minority factions will be defeated by “the republican principle,” which enables the majority to trounce the minority “by regular vote.”
But what if, as usually happens, there is in no meaningful sense a “regular vote” on minority appetites? The whalingprogram subsidy was born as a barnacle on the 2001 No Child Left Behind education bill. There was no majorityminority conflict about it because only the wee minority of whaling enthusiasts and a few solicitous legislators were paying attention.
Madison counted on conflict, but gargantuan government is, because of its junglelike sprawl, mostly opaque. So there is what Weiner
JamesMadison,whoseflintyrealismis
’ oftencalledpessimism,wastoooptimistic.
calls “dissipation of conflict.” And Weiner suggests that this, which enables minorities to feed off the inattentive majority, is the result of what Madison thought would inhibit abusive majorities — the size of what Madison called an “extensive” republic.
For a century now, Weiner writes, the national government has been hyperactive in distributing economic advantages to attentive but inconspicuous factions. This will not stop. Why?
James Joyce said his readers should devote their entire lives to understanding his fiction (not that a lifetime is long enough to fathom “Finnegans Wake”). If Americans devoted their lives to mastering the federal budget’s minutiae, gargantuan government might behave better. But what economists call the “information costs” of such mastery would be much higher than the costs of just paying the hundreds of billions that the subsidies cost. There is a name for what this fact produces: demosclerosis.