The Natural History of Governmental Intervention

The Natural History of Governmental Intervention MARY PETERSONpersuasively illustrates for sevenselected agencies what might be called the ,natural history of govern mental intervention into economic affairs: A real or fancied evil leads to demands to "do something about it"; a polit ical coalition forms consisting of sincere high-minded re formers and equally sincere interested parties; the incom patible objectives of the members of the coalition (e.g., low prices to consumers and high prices to producers) are glossed over by fine rhetoric about "the public interest," "fair competition," and the like; the coalition succeeds in getting Congress (or a state legislature) to pass a law; the preamble to the law entombs the rhetoric and the body of the law grants power to governmental officials to "do some thing"; the high-minded reformers experience a glow' of triumph and turn their attention to new causes; the inter ested parties go to work to make sure that the power is used for their benefit and generally succeed; success breeds its problems, requiring the scope of intervention to broaden; bureaucracy takes its toll so that even the initial special interests no longer benefit; ultimately, the effects are pre ciselythe opposite of the noble objectives of the high-minded reformers without achieving the more mundane objectives ofthespecial interests; yetthe activity is sofirmlyestablished and so many vested interests are connected with it that re peal of the initial legislation .is nearly inconceivable; instead, new governmental legislation is called for to cope with the problems produced by the old; and a new cycle begins.

From Milton Friedman's Introduction to The Regulated Consumer by Mary Bennett Peter son (Los Angeles: Nash Publishing, 1971).