Mayor Bloomberg, Money and Politics

Posted by Jeff Carter
on August 14th, 2012

This morning I was at a Chicago Economic Club breakfast. The two panelists were Mayor Bloomberg from NYC, and Obama’s former chief of staff, Bill Daley. It was moderated by Andrea Mitchell. That’s about as middle of the road as we get in Chicago!

The panel was supposed to be about immigration. Some excellent points were made. Personally, I favor a very liberal immigration policy in the United States. We need high quality immigrants. They fill jobs, create businesses and add to the vibrancy of the US. What we don’t need are poor quality illegal immigrants. It seems to me that there is a supply for immigration and a demand for immigration. That means there are economics involved with real curves that intersect at a price. What’s hilarious to me is the fences we put up to stop people from leaving once they get in!

Gary Becker proposed charging for immigration and I think it’s a compelling idea. Immigration is not a zero sum game. There are huge network effects for countries that encourage immigration. The US is a net benefactor from immigration, particularly in the 20th century.

But the panel degenerated into the current political campaign and the statements made were telling. Especially some of the things said by Mayor Bloomberg. It reflected his deep distrust of the individual to make their own decisions. Given his recent policies, that point has been put into practice.

Bloomberg said that money in politics was corrupting the system. Not because of donations to individual politicians, but because of all the SuperPACs on each side of the aisle. He advocated for full disclosure of donations. I agree with him. Every dime anyone, or any company or organization gives ought to be searchable in an online data base.

However, Bloomberg said he though social media was terrible for politics. He said all the bloggers, all the tweeters and Facebookers were ruining politics worse than the money. He said it was much better when there was an editor at a newspaper, or an editor on a television news desk that filtered stories and “fact checked” them before they were run. On that point he and I disagree.

Bloggers and tweeters are the new media that brings transparency and truth to the political process. Would the Anthony Weiner story been broken twenty years ago? How about Jack Abramhoff? Politicians lie today and they are instantly accountable. For example, the left currently says Paul Ryan’s Medicare plan guts funding for everyone. The truth is that it doesn’t affect anyone over 55, and changes the way people get their medical insurance. Ryan’s plan bets that private industry can provide medical coverage cheaper than the government. It’s a good bet. Bloggers got that information out there.

The centralized planning that Bloomberg advocates goes against the grain of a market economy. There is wisdom in crowds. Twitter, Facebook, and other social media outlets allow crowds to interact and come up with solutions. The more centralized the government is, the more it consolidates power. Eventually, it becomes so overbearing free people cease to be free. Individual rights and social justice go away, and the populace is left with a giant government to pay for.

This crucial point is the crux of the debate we are having today. Can government decide better for you and your family or are you the better arbiter of what’s good for you and what’s not? Should you have the freedom to choose, or should you be trapped in a government program that won’t let you out-but has exceptions for people that can get them?

Of course, we all know that it takes political clout to get those exemptions. That’s why it’s called crony capitalism. Bloomberg believes in centralization and crony capitalism. He came out in favor of it today. The solutions to our problems are letting individuals choose for themselves. We need a big gulp of freshwater economics.

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