Tuesday, June 04, 2002

costs are costs Send this entry to: Del.icio.us Spurl Ma.gnolia Digg Newsvine Reddit

costs are costs Fantastic (as always) Landsburg column in Slate today. Despite the title of the piece ("Shut City Hall! The Supreme Court concludes that most government agencies should be out of business."), it's not really about anti-governmentism. Instead it points out the easy-to-overlook truth that costs are costs.
When local landowners requested compensation for moratorium-related losses, the court turned them down. Why? Because, according to Justice Stevens, land-use regulation -- and for that matter most other government activity -- would be prohibitively expensive if governments bore all the costs. But if a regulation is too expensive when governments (i.e., taxpayers) bear the costs, then that same regulation is too expensive, period. If a development moratorium costs landowners $10,000, then the cost of that moratorium is $10,000, whether or not the landowners are compensated. Without compensation, the landowners are out $10,000; with compensation, the taxpayers are out $10,000; either way, the $10,000 cost is the same.
Landsburg's piece is timely, because I was thinking about the same issue today after reading a silly JWR column advocating a draft to force people to be airport screeners "at a price we can afford." To parallel Landsburg's argument, if I'm making, say, $100K working at MSFT, and the government wants me to be an airport screener, they have two options. They can offer me $100K (which costs the taxpayers $100K) so that I'm willing to leave MSFT. Or they can force me to work for $20K (which costs the taxpayers $20K and me $80K, or $100K total). Either way it costs $100K to get me as an airport screener. In the first case the costs are distributed widely among taxpayers, in the second they fall mostly on me. But the suggestion that mandatory service is a "cheap" way to get airport screeners is disingenuous. True, it's cheaper for the average taxpayer. But it's potentially very costly for those roped into serving.







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