“Eternal vigilance is the price of liberty. Power is ever stealing from the many to the few.”

– Wendell Phillips (1852)

Government wealth transfers from the many to the few is called the concentrated benefits, diffuse costs problem. Certain companies and projects get the loot–one hundred cents on the dollar–while the rest of us (taxpayers) pay an incalculable fraction per redistributionist dollar.

Democracy is perverted too because the majority would say “no” if directly asked but are far too busy tending to their own (nonpolitical) lives.  Michael Giberson found this in a 1935 book explaining the passage of the Smoot-Hawley Tariff of 1932:

Although . . . theoretically the interests supporting and opposed to legislation . . . are approximately equal, the pressures upon Congress are extremely unbalanced.

For most economists, the workings of “price gouging” laws are simple and predictable. Binding price caps in emergencies create shortages on the most urgently needed goods and services during emergencies.

The recommended policy reform is simple, too: stop harming citizens when they can least afford it!

It would seem to be an open-and-shut case, a slam dunk for economics to inform the electorate and thus policymakers to avoid such folly. Remember the gasoline lines and natural gas shortages of the 1970s? Perhaps no simple event has convinced mainstream economists that price controls have bad consequences despite intention.

Defenders of economic liberty have an even easier argument: merchants ought to be free to ask what ever price they like for the goods and services they offer. Price gouging laws unjustly limit that freedom and government ought not to do that.…

“The PTC was created in 1992 to get the wind industry off the ground. Yet 20 years later, we have little to show for it.”

When it comes to rent-seeking by business, Concentrated Benefits + Diffused Costs = Government Growth.

In “Regulatory Failure by the Numbers,” a simple hypothetical was given:

“While the benefits of a regulation may be enjoyed by a relative few, the costs are often spread out among many. If the per person cost of a regulation is only a dollar or two, no one has a financial incentive to travel to Washington to lobby against it.”

Economists in the 19th century understood the problem created by this incentive asymmetry, and Michael Giberson found this in a 1935 book explaining the passage of the  Smoot-Hawley Tariff:

“Although .

The coalition in support of wind power’s Production Tax Credit (PTC) has always had a bit of a Bootleggers and Baptists flavor: environmentalists making a clean and green argument in favor of wind power and the multinational wind power development corporations funding the political muscle needed to get things done.

The coalition has proven durable even as wind power took a few environmental hits, but now the business side of the coalition is beginning to fray. The PTC will expire at the end of 2012 unless Congress acts to extend it, and some interesting positions are being advertised as the tax-cliff approaches.

For example, the Chicago Tribune reports that Exelon Corp., a large electric power company that owns a significant amount of wind power and is a member of the American Wind Energy Association, is opposing efforts to renew the tax credit (sub.…