As a thought experiment, let us assume that you had the privilege to allocate 50 million dollars of public funds. These funds were originally intended for the Department of Health but a magical twist of fate has let you spend the money as you see fit. With the decision on how to allocate it is all yours, would you spend it on your own betterment or on more socially minded purposes?
Putting aside the moral aspect of this dilemma you may have with buying yourself a financially secure and luxurious future using public funds, would it be worth it?
After all, you will be making your country, where you and your loved ones reside, a worse place by potentially disadvantaging valuable programs. These programs could one day help you or someone you care about. They could do this directly, by you being a recipient of one of them, or indirectly by allowing business and innovation to continue enriching your life in a safe and healthy environment. Whilst you will be cutting the branch on which you sit, 50 million is such a huge sum, and the damage to your environment so limited, that it’s probably worth it.
However, if, instead of 50 million dollar in one budget, you pocketed 90% of Australia’s tax revenue over 5 budgets, would it still be worth it? Probably not: functioning property rights, welfare, army, public service and investments in the future will all be damaged beyond repair. It simply wouldn’t be in your interest to take so much because the secure and pleasant environment you and your loved ones need to enjoy hundreds of billions of dollars wouldn’t exist anymore.
This fantastical situation is closer to your life than you may imagine. You are part of a number of voting demographics. Unsurprisingly, evidence exists that politicians allocate more funds to voting demographics then to nonvoting demographics. Politicians do this, in part, because they want to win favor with the demographic. Of course, that’s less likely to work if they think the long-term cost of allocating the funds or favor to them is not worth it for them
The real-life equivalent to the 50 million dollar question may be “a politician is running on the ticket of advocating for only my ethnic sect/ tax bracket, is it a good idea to vote for him on that basis?”
The reason deliberate deliberation on this non-moral dilemma is important is because the rewards may be more forthcoming then the costs. An election promise could come to fruition within a few months whereas the consequences of revenue problems or sectarian division can take years to come back to bite you – and when it does you might not even know why your buttocks is aching.
At this point you might have noticed how information poor you are. You don’t know exactly how much you will benefit from a given policy or politicians, or if you do you don’t know what will happen as a result in years to come. You don’t know what the alternative politician will do to the institutions or sect you are trying to advantage. Even worse, there is nobody to help you to quantify the costs because even in the rare cases where we do know how to measure the quality of institutions it is well beyond us to measure the effect of a specific policy on them and extrapolate from that the impact on you and your loved ones.
Much of the rational choice themed economic literature around rent seeking assumes that the conflict before the perpetrator is between accountability/ punishment mechanisms and the potential size of the reward. Maybe, in some cases, rent seeking has more to do with self-interested short term thinking winning over against self-interested long term thinking. Such a model would emphasize tools that combat hyperbolic discounting as opposed to accountability.
As for myself, my life is too good, I have too much to lose and am too aware of the horrors of the Middle East to take such risks by aligning my political power in the pursuit of self-interested short term personal gains. Perhaps if I was in direr need of firewood I would more readily collect wood from the branch on which I sit.
razipilli 