Lest the true moral of the New York Times story on how companies that have been recipients of federal largesse have found clever ways of circumventing Congress’s putative intentions in banning earmarks from private companies that were showing a profit be lost in the rush to condemn Republicans, Democrats, politicians, lobbyists, or private companies, this should come as no surprise. A few years ago a couple of economists received the Nobel Prize for Economics for their work demonstrating how limited public policy is in achieving its goals because human beings are intelligent actors and will always find ingenious ways around a regulation, often with dramatic and unforeseen adverse secondary effects.
Getting around the intentions of Congress while adhering scrupulously to the terms of the law is not fraud. It just demonstrates the limitations that policy makers should acknowledge. It is not a corruption of the system. It is the nature of the system. Here is the operative section of the article:
“It reminds me of the line from “Jurassic Park” — ‘Life will find a way,’ ” said Representative Jeff Flake, Republican of Arizona, who has pushed for nearly a decade to curtail earmarks. “When you have easy money like this, it finds a way, and members find a way to enable. And that is happening again.”
In ignoring the spirit of the ban, some lawmakers are leaving it up to Congressional committees to block them, a prospect that both Democrats and Republicans on Capitol Hill concede will be near impossible.
“No matter what they tell you, there is just no way they can police all that,” Mr. Flake said. “They just don’t have the time or resources.”
The best regulations are those which align incentives with goals rather than putting up barriers and the most effective government is one that attracts people to strive for the objectives it sets out (soft power) rather than imposing bans, quotas, or limits, or providing subsidies (hard power).