Inequality grows hand-in-hand with the growth of the
regulatory state. The proliferation of regulations increases economic
inequality, since powerful people and politically connected companies know how
to shape and manipulate the regulatory process to harm their rivals and enrich
themselves at the expense of the public. As the Roman senator and historian Tacitus observed, ‘The more corrupt the state, the more numerous
the laws.” Moreover, regulations disproportionately increase the cost of
consumer staples that are a larger part of middle class people’s budgets than
of rich people’s budgets.
The recent growth of major
regulations has created an explosion in lobbying and wealth here in
the Washington, D.C., area, even as much of America suffers economically. This
transfer of wealth to Washington from the rest of America has led to many
people here having incomes I can only envy (I still live in a little
two-bedroom house with my wife and daughter). Neighborhoods full of government
contractors and lobbyists have much higher incomes than other neighborhoods in
the region. A Washington
Post article today discusses
this avalanche of lobbying-related wealth that has enriched the Washington area
at the expense of America. (Actually, it understates things. It likely reflects
narrow legal definitions of lobbying that understate its growth.) As the Post
explains,…..ToRead More……
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