WTF, yo...oh
C'mon, duh, duh, c'mon, duh
I am a, duh, I'm a big donor man
I'm a big donor man
The plebes don't know, but the rich folk understand
Hey, all you serfs that are tryin' to survive
I'm taking away the money that keeps you alive, duh
'Cause I'm a big dough man
The plebes don't
know, but the rich folk understand
All reet, duh
You chumps go eat your lunch, crap on week-old bread
What we say at fund raisers make you wish you were dead, duh,
I'm a big donor man, wtf
The plebes don't
know, but the rich folk understand
Well, I'm a big donor man
I'm a big dough man
Duh, sucka, I'm a big dough man
The plebes don't know, but the rich folk understand
Excerpt from Fix It. Voters don’t usually notice charitable donations that are subsidized by government, but these aren’t the only invisible ways in which elites can leverage government for their own advantage. Rent-seeking occurs when scarcity adds to the amount that can be charged for a product or service. Scarcity, however, can be artificially created by groups seeking to create regulations which favor themselves. There are four ways in which special interests can gain unfair market advantages, Brink Lindsey and Steven Teles write in, The Captured Economy: How the Powerful Enrich Themselves, Slow Down Growth, and Increase Inequality.
Their examples of special interest rent-seeking come from finance, intellectual property, occupational licensing, and land use. Lack of competition, they argue, is one of the reasons behind income inequality. Enforcing antitrust laws would create more competition “But an absence of competition also comes from the affirmative use of government power, such as when incumbents are able to fend off challenges by constructing barriers to entry like licenses or intellectual property protection.”
While no one wants to see a doctor lacking sufficient credentials, over-strenuous requirements can keep qualified physicians out of the game:
Although graduation from a U.S. medical school is not required to obtain a medical license, completion of a U.S. residency program is … The U.S. residency requirement, combined with highly restrictive policies on high-skill immigration, makes AMA power over medical school accreditation a powerful lever to constrict supply. Meanwhile, by historical accident the vast bulk of funding for residency slots is provided by Medicare, and for cost saving reasons the number of slots has been frozen since 1997. In 2016, for example, 8,640 graduates of accredited medical schools who applied for residencies—or roughly a quarter of all applicants—failed to be given a match.
If a quarter of new doctors can’t find residencies, then shortages of doctors are bound to lead to higher healthcare costs. Should the AMA choose to loosen requirements enough to increase the supply of physicians, they would also be reducing the potential salaries of their members. Groups like the AMA lack incentives to increase membership and are likely to become even more restrictive in influencing licensing requirements. Unfortunately lawmakers receive most of their information from those most likely to engage in rent seeking. Such groups have both money and organization on their side while ordinary citizens lack both and are often unaware of potential rent seekers.
Silicon Valley is another source of rent seeking. Just recently one of Amazon’s patents expired. This was for their one-click purchasing method. While there’s nothing inherently inventive in a method that saves a mouse click, Amazon none-the-less gained an advantage over Barnes and Nobel with this dubious patent.
It’s easier now than in earlier years to obtain patents. “In 1982, the newly established Court of Appeals for the Federal Circuit (CAFC) was vested with exclusive appellate jurisdiction over patent cases. Since then, the CAFC has reshaped the law by lowering the standards for patentability and expanding the scope of patentable inventions to include software, business methods, and even parts of the human genome. As a result, the number of patents issued annually by the US Patent and Trademark Office has increased almost fivefold. …
For this reason an entire industry buys patents in order to sue those who infringe upon them. The potential liability that one might be sued for accidentally using another company’s patented method discourages innovators from developing new products. Loosely defined and over-enforced, patent laws are stifling start-ups, crushing competition, and preventing progress.
