Economic Opportunity Needs a Moral Dimension; L.W. Reed

Each 1 percent increase in the federal tax burden, report economists William Dunkel burg and John Skorburg for the Cato Insti tute, results in a 1.8 percent decline in national output and a 1.14percent decline in national employmenta loss of about 1.5 million jobs. A study from the National Center for Policy Analysis points out that a Lawrence W. Reed, economist and author, is President of The Mackinac Center for Public Policy, a free market research and educational organization headquartered in Midland, Michi gan. 1 percent decrease in the tax rates on all saving and investment income would gen erate enough new investment to increase the nation's output by $25 billion. Dozens of studies have shown that exces sively restrictive zoning laws, building codes, and property taxes constitute the greatest obstacles to affordable housing for the poor. Minimum wage laws, by making it illegal to employ people whose skills are worth less than Congress decrees, keep hundreds. of thousands from getting a start in the job market. Endless regulations de signed to curtail entry into markets from trucking to taxis freeze out many a would-be entrepreneur from creating new businesses.

I'm not talking about basic laws which prevent or punish harm to others. I'm talk ing about the primary social disease of our age-government beyond its proper bounds, playing Robin Hood, Santa Claus, and Mother Hen all at the same time, inflicting real damage to real people who have vic timized no one. Economists, at least, are increasingly taking a critical eye to such policies. It must be understood, however, that economic analysis will not by itself make the case for ridding ourselves of these man-made obstructions. It is powerful, but still not enough, to simply tote up the numbers and show how many jobs are erased by particular actions of government. It is not enough to produce graphs and models that plot the fluctuations in Gross National Product. 282 ECONOMIC OPPORTUNITY NEEDS A MORAL DIMENSION 283 What is sorely needed in the discussion is a recognition of the moral backwardness that so many of these barriers to economic opportunity represent. Dismantling the bar ricade requires that we who advocate free dom of enterprise seize the high ground. We must appeal to what most people instinc tively know is right, not just what makes the cash register sing. We must learn to speak of the deleterious actions of govern ment in terms of trampled rights, broken dreams, and ruined lives.

For instance, when the city of Detroit in my state imposes-as it does-a tax burden that is seven times the average burden in Michigan municipalities, that is not simply bad economics. It is an affront to every citizen of that city who wants the best for his family, who wants simply a chance to be productive. Those high taxes should evoke visions of hungry children, of a boarded-up business that was once someone' s dream, of homes torn apart because of the breadwin ner's inability to pay the bills of irresponsi ble politicians. In case a reader might think I'm dealing in generalities, let me provide a very specific example-also from my state of Michigan. As is the policy in 41 other states which regulate the business of trucking, the "au thority" to haul goods within the state is granted by state government. The Michigan Public Service Commission is empowered to determine who can be in the trucking business, what goods they can and can't transport, where they can haul them, and what rates they can charge their customers.

Doing business as a Michigan trucker means playing an elaborate and costly game of "Mother, May I?" with state bureaucrats filing forms and begging permission every step of the way. The regulatory apparatus is not designed to protect the public from any harm. Rather, it is a means by which some of the regulated firms discourage newcomers and keep rates artificially high. One company, known as Federal Armored, Inc., ran afoul of these rules recently. A Public Service Commis sion ruling stripped the company of its right to do intrastate business in Michigan, re sulting in its severance of more than 160 employees. There were no public health or safety questions involved, no alleged fraud, and no complaints against Federal Armored by any of its customers or employees. The com pany's "crimes" boiled down to nothing more than charging customers less than the fixed rate and failing to file worthless paper work with state regulators. The PSC itself brazenly asserted, "The absence of shipper objection ... is irrelevant to Federal Ar mored's fitness" to do business in Michigan!

Why is it that people who go to work for government as officeholders or bureaucrats are known as "public servants"-even when highly paid? Why isn't "public ser vant" a term reserved for those entrepre neurial heroes in the private sector who createjobs, invent machines, cure illnesses, build businesses, serve customers, and pay the bills of government through their taxes? When the barriers erected by "public ser vants" crush the self-reliance of citizens like those at Federal Armored, where is the outcry of righteous indignation from the public or the press? What regulators did to Federal Armored -and what countless other acts of govern ment inflict upon people every day-is mor ally repugnant. Such deeds are throwbacks to less enlightened times when the common thief and the uncommon prince were indis tinguishable but for their robes. The campaign to restore our liberties and enhance our economic opportunities must incorporate a personal, moral dimension at its core. A law which suffocates the aspira tions of enterprising men and women is more than bad economics. In a free society, it ought to be a moral outrage. D THEFREEMAN IDEASON LIBERTY THE FASCIST EPITHET by Mack Tanner E Pithets are always good political weap ons. If they are well chosen, they paint the opponent's reputation so black that further discussion is no longer required. If an opponent is inherently evil, then one has no reason to expect that rational discussion and debate would produce any useful result.