Economics in One Lesson:The Government Says It's Fair

It seemed to me that the word “fair” appeared a number of times in this weeks reading.  This section revolved around Exports, “Parity” Pricing, Saving the “X” Industry, and Government Price Fixing.  Mr. Hazlitt does a good job of presenting the arguments many politicians used when this book was written to advocate certain practices.  It’s amazing that these arguments continue to be used today.   It’s also amazing how many times the word “fair” is involved in the justification.

For example:  In the chapter on price-fixing, one of the arguments for government involvement is so that, “…everyone will get their fair share”.  Again when discussing parity prices for farmers, the argument is that parity pricing is,”…the farmer’s equivalent of the tariff.  It is the only fair thing to do.”  I have heard similar arguments for cap and trade, health care, and any number of modern proposals.   Personally, anytime Congress tries to legislate what is or isn’t “fair”, I start to get really nervous.

The main point of Economics in One Lesson is that economists should look at the effect on everyone for any policy being debated.  I would argue that when a politician argues that a law should be passed because it’s fair for group A, we should all cringe.  Much like the classic forgotten man, when politicians want a law to be fair, it is almost guaranteed to be oppressive to someone else.

For example, quoting from Fox News today:

“As Democratic fears increase that health insurance reform could slip away with a crucial vote for a new U.S. senator in Massachusetts, President Obama on Sunday used a church pulpit at a Martin Luther King Day service to say the massive health bill would be a victory for ‘decency.'”

This is the same tactic, only swapping the word “Fair” for “decency”.  Further on, the President said that the healthcare bill will be a victory for decency and dignity.  How so? How is it a victory for the 250+ Million Americans who already had health insurance, but will not either pay more money, or see their health care change under this law.   How is it fair, decent, or dignified to have one party in Washington try to force a bill on Americans who don’t want it?  What about those individuals Democrats and the President promised to cover that won’t be covered under this bill?  How is this bill a victory for them?

In my humble opinion, anytime we are told the government wants to pass a law because its “fair”, we should all grab our wallets and be very afraid.