Police, Courts, and Prisons

Part 9 – Special Interest Groups

Lee Friday

I recommend reading Parts 1 through 8 before reading this essay

The vast majority of authoritarian laws are created not because a majority of the public demands these laws, but because of the lobbying efforts of special interest groups. These interest groups are incentivized to use the legislative process to force rules of behaviour (laws) on others because they can externalize the cost of enforcement onto the backs of taxpayers. Political interests, not evolving customs, dictate new law creation.

German sociologist Franz Oppenheimer observed that there only two ways to acquire the things we want in life: (1) through one’s own production and voluntary exchange in the marketplace, which he called the economic means (2) through the violent expropriation of the wealth of others, which he called the political means.[1] While I do not share all of Oppenheimer’s views, this particular observation is self-evident. The giving of gifts does not involve an exchange, but the act is voluntary on the part of the giver. Other than this, there is no third method of acquiring what you want.

Individuals do not pay taxes voluntarily. They do so only under the threat of violence – forcible confiscation and/or incarceration. Thus, under authoritarian law, all actions of government involve the use of the political means. Above all else, the primary function of the State has always been to serve as a coercive mechanism for the transfer of wealth. Special interest groups lobby for legislation favouring their group. Politicians seek to satisfy those requests which will generate the greatest return for themselves, while penalizing taxpayers/consumers.

Benefits for politicians include (a) political campaign contributions, and (b) enhanced prospects for election due to promised legislation benefitting particular individuals – thus more votes are bought from a particular group, industry, or constituency, regardless the cost to the majority of the population, and (c) corporate jobs when they leave office. Powerful political campaigns are managed by individuals trained in the practice of selective vote targeting. The goal is to get elected, or re-elected, by satisfying the desires of special interest groups, not the majority of the public.

Politicians and bureaucrats wish to serve themselves, but they can achieve this goal only by serving the special interests. These are the perverse incentives hard-wired into every system of authoritarian law. There may be a few honest individuals who are not motivated in this way, but they are rendered impotent because their power-hungry peers outnumber them by a significant margin. As Bruce Benson wrote:

Political pressure groups play a significant role in determining legal policy emanating from the legislative process. In fact, as Rhodes pointed out, “as far as crime policy and legislation are concerned, public opinion and attitudes are generally irrelevant. The same is not true, however, of specifically interested criminal justice publics, particularly in the politics of legislation.” What gets defined as criminal behaviour by statute, for instance, is the result of a political process. One must understand this political process in order to understand crime.

Interest group pressure influences more than the legislative definition of criminal activities and sanctions. All areas of law are subject to interest group manipulation through the legislative process. Furthermore, once laws are passed, the administration of justice is also influenced by interest groups. After all, the mere legislative passage of rules does not provide any guidance or incentive for enforcement. Attempts will be made to influence the courts, the police, the prosecutors, and the rest of the administrative system to assure that the laws each group desires are enforced.

. . . Courts may be very attractive avenues through which to pursue interest group goals. . . . Because the advantages that courts can generate for an interest group can be lost if the judge in power does not favor that group’s position, interest groups actively pursue favorable judicial appointments. As Judge Neely explained, “Any concept of merit selection – that is, selection based exclusively on objective standards rather than politics – is chimerical. . . .”

. . . Public law enforcement bureaucrats also have tremendous discretion in the allocation of bureau resources. As Bent noted:

. . . the overload of statutes has made impractical the mechanical application of law by police. Instead, this overload invites the influence of prejudices of individual police officers . . . resulting in the law being administered unevenly and selectively.

With such discretion, police can choose which laws to enforce strictly and which not to enforce at all. In fact, this discretion is an important ingredient for meeting the demands of powerful special interests; police can not only choose which laws to enforce, but which laws to enforce for whom. A person’s chances of police protection correspond closely to his position in the “geography of political power.” Much more attention is paid to the robbery of an important political figure than to the murder of an out-of-work, uneducated member of a racial minority.

. . . Eisenstein found that because the conviction rate is the main concern of most prosecutors, it is more important “not to lose than to win.” As a result, many prosecutors dismiss a case or plea bargain, giving them a large number of convictions at a low cost in terms of their time and effort. Criminals are generally convicted on fewer or lesser counts and receive lighter punishment . . . Judges benefit as pressure on the court docket is relieved. Notice that there is no advantage for crime victims in these exchanges. . . . After all, the only potential benefit accruing to victims under the current system might be the satisfaction of revenge, knowing that the perpetrator is being punished for his crime, or that he will be prevented from committing another crime for a significant period of time. Plea bargaining generally leads to shorter and concurrent sentences. The victim often feels violated by the justice system as well as by the criminal because of plea bargained forgiveness of crimes. These exchanges make bureaucrats and criminals better off, but it is not clear that they enhance justice. [2]

GOOD  LAWS  versus  BAD  LAWS  i.e.  VICTIMS  versus  NO  VICTIMS

Remember the golden rule.

We have seen the statistics for crime resolution in Canada. Go back to have a quick look at the chart in Part 8. Notice that each of the categories listed represents crimes against a person, or the property of a person, which means there are identifiable victims in all cases. Also, recall the extremely low rate of crime resolution in every category.

Laws which contemplate victims are a small fraction of the total number of laws created by the authoritarian state. Thus, for the vast majority of laws, when they are broken, we need to recognize the offender’s action as a victimless crime.

The authorities always justify these laws as being in the public interest, or to ensure the safety of the public, or in the interests of national security. These are abstract terms intended to deceive. There is no such thing as the public interest or consumer safety or national security. There is only the interest, or safety, or security, of an individual. A particular set of circumstances which one individual considers to be adequate to address their personal interest, safety, or security, will not necessarily satisfy the next individual. These are subjective issues. However, the growth of authoritarian law is firmly rooted in propaganda aimed at convincing the public these issues are objective, not subjective. This paves the way for innumerable laws designed to satisfy, not some nebulous notion of the public interest or national security, but the interests and security of profits for special interest groups, including the government itself.

We have speed limit laws, seatbelt laws, motorcycle helmet laws, home gardening laws, home renovation laws, prostitution laws, gambling laws, and thousands of other laws which, when violated, do not create victims. We are told these laws exist because the government’s primary concern is for our personal safety, but such claims are disturbingly curious. If citizen safety is indeed the priority of government, then all resources should be directed to the prevention, investigation, and prosecution of murders, rapes, and robberies, before any resources are devoted to ostensibly improving other aspects of our lives. However, the evidence proves (Part 8) this is not happening.

Prevention, investigation, and prosecution of crimes such as murder, rape, and robbery consumes considerable resources, at least from the viewpoint of government. In contrast, fewer resources can be deployed for rapid prosecution of innumerable easier-to-solve victimless crimes, many of which result in fines. Remember what Benson said: “police can choose which laws to enforce strictly and which not to enforce at all.” As Laurence Vance wrote “Is there any doubt that governments are more interested in revenue than safety?”[3] Every government department wants to increase its size, its scope, its budget, its prestige, its authority, its profits, as easily as possible. Thus, these various departments are special interest groups.

Before you continue reading this essay, I strongly encourage you to take 5 minutes to read Vance’s article, titled “Every Crime Needs a Victim”.

Non-governmental special interest groups – there are many – benefit from thousands of laws and regulations enacted by all three levels of government. Definition of ‘regulation’: the imposition of rules by a government, backed by the use of penalties, that are intended specifically to modify the economic behaviour of individuals and firms in the private sector.[4] Thus, resources are devoted to the creation and enforcement of regulations, the violation of which do not produce victims. There are no victims because these laws are arbitrary rules of behaviour designed to benefit special interest groups. As such, it is decided by the State – by its actions, not its words – that the creation and enforcement of these rules is a much higher priority than keeping citizens safe from murders, rapes, and robberies.

It is irrelevant whether politicians and bureaucrats intentionally make this trade-off. All that matters are the results, which clearly indicate that citizen wellbeing is not a political priority.

Numerous regulations are enacted because the State says it can correct market inefficiencies, while the real intent is to reduce competition for various corporations and industries, often by imposing regulatory costs on all companies within a particular industry. The large company(s) which lobbied for the law can easily absorb these costs, while their smaller competitors and potential start-up companies, lacking the financial wherewithal for regulatory compliance, are eliminated.

Under authoritarian law, enforcement requirements will always exceed enforcement resources. It is impossible for the State to seize resources (taxes) sufficient enough to enforce thousands of laws. Therefore, as Benson noted, laws will be enforced selectively, and political influence plays a significant role. The result is a pathetic crime resolution rate where actual victims exist because perverse incentives place the focus on easier to solve victimless crimes. Crime resolution rates for victimless crimes can also be low, but because they are more numerous and easier to solve, more resources are devoted to the task.

ILLEGAL  DRUGS  AND  SPECIAL  INTEREST  GROUPS

A basic principle of economics is that you cannot change one thing in isolation. Illegal drug laws produce various effects, as well as unintended consequences. Drug prohibition has not significantly reduced the rate of addiction, and even if it did, it is difficult to justify these laws in light of their negative effects. Let’s review a few of these effects:

1) A product declared illegal by government will always cost more than its previously legal counterpart because of the prospect of capture and prosecution for all parties dealing in the illegal product.  Manufacturers and dealers will not provide the product unless the payoff is large enough to compensate for the risk. Therefore, buyers must pay substantially higher prices. Higher prices rarely deter addicts, but it transforms many of them into common criminals, resorting to theft and violence in support of a drug habit.

2) Individuals who are completely bereft of morals and lack the wherewithal to hold down an honest job find themselves ideally suited to the risky life of the big-time-drug-dealer. High prices are the initial attraction, but success depends on a willingness to employ violence as a means of eliminating competitors in order to protect and enlarge a particular market (their territory), thereby ensuring prices, and sales, remain at a high level. These individuals are in favour of drug laws – they are a special interest group – and many of them contribute to political campaigns of candidates who offer (sell) their support for such laws. Violent competition has ended the lives of many gang members, and many innocent bystanders.

3) Capitalism, by definition, is non-violent. On the free market, companies must compete for customers by focusing on product quality and price. In the illegal drug market, prices are high and customers are retained not through product quality, but through violent elimination of competitors. The salesmen are efficient but product quality suffers; the need to evade law enforcement authorities impedes the ability of the manufacturer to set up a permanent, professional, quality-control operation for production of drugs, and the elimination of competition reduces the necessity for doing so. Impurities and increased potency lead to overdoses and a much higher consumer death rate than would be the case in a legal drug market.

These three effects, especially the latter two, mirror the U.S. experience of the 1920s during alcohol prohibition, the imposition of which was driven by the temperance movement, a special interest group. As Benson noted, “Joseph Gusfield’s examination of the Volstead Act concluded that temperance advocates represented the interests of a relatively small segment of the population.”[5]

Additionally, the possibility of arrest, prosecution, and imprisonment raises occupational risk for drug dealers, but with profit margins high, they have the means to sidestep the law by bribing police, lawyers, judges, and other government officials. Such complicity by these ‘authorities’ may involve little mental anguish because they consider the sale of illegal drugs to be a victimless crime. Thus, the scope of corruption in the drug world is likely to be much wider compared to offences such as murder, rape, and robbery, crimes which involve a victim.

Here are some of the costs of the war on drugs, some of which are identical to the effects described above.

1) Numerous innocent bystanders killed or wounded during gang turf battles

2) Numerous innocent victims of theft, robbery, assault, and murder by ‘users’ who resort to crime in order to afford the high drug prices created by prohibition

3) Numerous ‘user’ deaths resulting from inferior products made by amateurs

4) Numerous users, who have not caused harm to others, are imprisoned, thus causing irreparable harm to their own lives, and robbing society of their economically productive efforts

5) Social decay in many poor neighbourhoods as police selectively enforce drug laws. As former U.S. Federal Judge Nancy Gertner said, “We were not leveling cities as we did in WWII with bombs, but with prosecution, prison, and punishment.”

6) Billions of tax dollars to support police, court, prison, and other government bureaucracies involved in the war on drugs.

No doubt there are other costs which I have missed.

Special interest groups are not limited to non-government entities. The various government bureaucracies mentioned above must be seen as special interest groups who profit from crime. They will vehemently oppose legalization [6] in the name of public health and safety. If the manufacture, sale, and use of drugs is de-criminalized, they would lose their taxpayer supported jobs, and be forced to find productive jobs in the marketplace.

Decriminalization also means taxpayers would keep more of their earnings, thousands of prisoners convicted of victimless crimes would be released, and all of the other costs listed above would disappear. The resulting increase in the freedom of human interaction would produce more peaceful, prosperous communities.

Some current and former law enforcement individuals are opposed to prohibition.[7] Unfortunately, at present, they are too few in number to make a difference.

ILLEGAL  DRUGS – SUMMARY

Criminalization of drugs decreases public health and safety, which is the opposite of the stated purpose of the legislation. When considering the imposition of an authoritarian law, we should always ask ourselves “who benefits from this law?” Or, we can turn the question around – if a particular law is repealed, “who loses?”

People always have and always will use drugs. The government cannot keep drugs out of the hands of convicted criminals, in prison, yet professes an ability to keep drugs out of the hands of the rest of us. Drug prohibition is a failure just as alcohol prohibition was a failure in the 1920’s. In both cases many problems were caused and few, if any, problems were solved. Legislation ostensibly intended to save lives ends up destroying lives. We cannot create a utopian world. Addicts will acquire drugs, legal or not, which means the harmful effects of drug use are unavoidable. When we attempt to use the power of the State to defy the laws of human nature, we achieve the opposite of our objective; instead of reducing harm to individuals, we increase harm to individuals. Prohibition creates perverse opportunities for some individuals to achieve huge profits through violence, corruption, and taxpayer funded jobs – and that, dear reader, is the purpose of prohibition. Follow the money, and see the transfer of wealth.

Having identified the economic and social effects of the criminalization of drugs, let’s consider the issue philosophically. Here is Ludwig von Mises, writing in 1949:

The problems involved in direct government interference with consumption . . . concern the fundamental issues of human life and social organization . . .

Self-styled “realistic” people fail to recognize the immense importance of the principles implied. They contend that they do not want to deal with the matter from what, they say, is a philosophic and academic point of view. Their approach is, they argue, exclusively guided by practical considerations. It is a fact, they say, that some people harm themselves and their innocent families by consuming narcotic drugs. Only doctrinaires could be so dogmatic as to object to the government’s regulation of the drug traffic. Its beneficent effects cannot be contested.

However, the case is not so simple as that. Opium and morphine are certainly dangerous, habit-forming drugs. But once the principle is admitted that it is the duty of government to protect the individual against his own foolishness, no serious objections can be advanced against further encroachments. A good case could be made out in favour of the prohibition of alcohol and nicotine. And why limit the government’s benevolent providence to the protection of the individual’s body only? Is not the harm a man can inflict on his mind and soul even more disastrous than any bodily evils? Why not prevent him from reading bad books and seeing bad plays, from looking at bad paintings and statues and from hearing bad music? The mischief done by bad ideologies, surely, is much more pernicious, both for the individual and for the whole society, than that done by narcotic drugs.

These fears are not merely imaginary spectres terrifying secluded doctrinaires. It is a fact that no paternal government, whether ancient or modern, ever shrank from regimenting its subjects’ minds, beliefs, and opinions. If one abolishes man’s freedom to determine his own consumption, one takes all freedoms away. The naive advocates of government interference with consumption delude themselves when they neglect what they disdainfully call the philosophical aspect of the problem. They unwittingly support the case of censorship, inquisition, religious intolerance, and the persecution of dissenters.[8]

CONCLUSION

Economics is about identifying ‘causes and effects’ of human actions on an individual level as each of us attempts to satisfy unlimited wants and desires in a world of scarce resources. With respect to illegal drugs, criminalization is the cause, for which politicians speak about only one effect – fewer people use drugs. That this one effect has been achieved is highly debatable, but far more importantly, there are many other effects, as seen above.

This is the norm for most authoritarian laws, where politicians and bureaucrats pontificate about the supposed benefit of a particular law, while remaining silent about the potential for disastrous negative effects. Their silence guarantees the evening news anchor will present the sound bites we are intended to hear. However, as Henry Hazlitt wrote in his book Economics in One Lesson, “economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group, but for all groups.”

Competition is prohibited by numerous regulations, which results in a lower standard of living for the masses. This is manifest in declining production and employment, lower paying jobs, higher taxation, declining freedom, and consumer products which are lower in quantity, lower in quality, and higher in price. Thus, the government facilitates a transfer of wealth from the masses to the favoured corporations who have captured a larger share of the smaller market.

Full disclosure – I am not a user, so this is not the reason for my support of decriminalization of drugs. I am writing about the benefits accruing to special interest groups due to the perverse incentives embedded in a system of authoritarian law. I have explained that authoritarian law is a coercive mechanism for the creation of laws which transfer wealth to politicians, bureaucrats, and other special interest groups, while the economic and social costs of these laws are borne by everyone else. It is useful to present a short summary of a particular law to more clearly illustrate these concepts. Space is limited, and I chose to discuss laws which criminalize the manufacture, sale, and use of drugs. I could just as easily have presented a detailed summary of a different law. There are thousands from which to choose. Here are four examples of benefits granted to producers (special interest groups):

Tariffs – foreign competitors are penalized, resulting in higher consumer prices

Agricultural supply management (quotas) – supply is restricted, resulting in higher consumer prices

Antitrust, Competition law – reduces competition, resulting in higher consumer prices

Money & Banking laws – see my essays on Money; one of many results is higher consumer prices

Authorities are not overly concerned with resolving crimes such as murder, rape and robbery (Part 8), though they allocate considerable resources to the creation and enforcement of laws which benefit special interest groups. Thus, taxpayers believe they are paying for enforcement of laws which envision actual victims, but they are actually paying for enforcement of laws which benefit powerful interests, including the government itself. Ordinary citizens, who have virtually no influence over this process, suffer the effects of:

1) Poor crime prevention – where actual victims are created

2) Poor crime resolution – where actual victims are created

3) Externalized costs for laws benefiting special interest groups

I must emphasize this again – citizens have virtually no influence over the operations of government (this will be discussed in Part 12). Voting creates the illusion of influence. Voters might ‘kick the bums out’ and put a new party in control, but the new party is still an authoritarian party. Any visible improvement is marginal at best. Powerful special interests are still calling the shots. The players may change but the fraud continues.[9]

The predominance of special interest groups imposes costs on the general public which go far beyond the tax dollars collected by government. This will be covered in Part 12.

Go to Part 10

 

[1] See Murray N. Rothbard Man, Economy, and State, with Power and Market (Scholar’s Edition, Second edition, Ludwig von Mises Institute, Auburn, Alabama, 2009) pp 1057-58

[2] Bruce L. Benson The Enterprise of Law (The Independent Institute, 2011) pp 87-8, 96-7, 132-3, 137-8 [additional sources provided by Benson: Robert Rhodes, The Insoluble Problems of Crime (New York: John  Wiley and Sons, 1977) p 13; William Chambliss, “The State, the Law, and the Definition of Behavior as Criminal or Delinquent” in Handbook of Criminology, ed. Daniel Glaser (Chicago: Rand McNally, 1974) p 39; Richard Neely, Why Courts Don’t Work (New York: McGraw-Hill, 1982) pp 37-38, 131; Alan Bent, The Politics of Law Enforcement: Conflict and Power in Urban Communities (Lexington, Mass.: Lexington Books, 1974) pp 3-6; Eisenstein, Politics and the Legal Process, pp 104-5]

[3] Laurence M. Vance Every Crime Needs a Victim (2010)

[4] Laura Jones, Stephen Graf Canada’s Regulatory Burden. How Many Regulations? At What Cost? (The Fraser Institute, 2001) p 7

[5] Bruce L. Benson The Enterprise of Law (The Independent Institute, 2011) p 106 [source provided by Benson: Joseph Gusfield, Symbolic Crusade (Urbana: University of Illinois Press, 1963)

[6] Jacob Huebert When All Drugs Were Legal, this article is excerpted from Huebert’s book Libertarianism Today (Praeger, 2010) pp 68 – 69

[7] Law Enforcement Action Partnership – Drug Policy I fully support this group’s goal of ending prohibition, though I oppose some of their policy recommendations.

[8] Ludwig von Mises Human Action, A Treatise on Economics (Ludwig von Mises Institute, 1998) pp 728-29

[9] The exception to this – though it has never occurred – would be a party elected on a platform of (1) No new laws, and (2) Repeal all laws which do not contemplate victims. This would be an exception, assuming the party kept its promises.

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