The Skeptical Entrepreneur lives for this - call it Executives Behaving Poorly.
Buon appetito. Don't say we never gave ya nothin'.
Wednesday, December 18, 2013
Wednesday, December 11, 2013
Of Subsidies, Spending Priorities and Corporate Profits
From TIME magazine comes an analysis piece that says that fears of $8/gallon milk are overblown. The Skeptical Entrepreneur and family are the milk-drinkin'est bunch that you're ever likely to find this side of Pediatric Ward; even if milk had (more than) doubled in price, we would still be lined up in the dairy aisle to keep fresh moo-juice on hand.
The point that is being missed in all of the hoopla about a spike in dairy prices is that, in the end, the only people who would be hurt by the expiration of Federal dairy subsidies would be, not the dairy producers, not the consumers, but the other [non-supermarket] [retail] businesses whose potential revenues would have gone to the supermarket sector to pay for more-expensive dairy products.
TSE is left to marvel at the short-sightedness of the "starve-the-beast" mentality that animates so many fiscal conservatives. Their misguided, undisciplined zeal for cutting Federal spending and demonizing "takers" presents an unacceptable level of risk of damaging the economy, in the interest of "stabilizing" and "strengthening" the public purse. The only "beast" who would be harmed by allowing dairy subsidies to expire would be the retail sector's ox, gored by the free market's re-allocation of scarce consumer dollars toward more-expensive milk.
Does the "cut-the-budget" crowd simply not understand their own mantra of "socialize costs?" Do they imagine that costs should be socialized only among the "Other" (read: consumers), and not among entrepreneurs and enterprises?
Do they not understand that the cost of maintaining the inflow of consumer dollars into their tills is the outflow of their tax dollars into the Federal till, to fund dairy (and other agricultural) subsidies? Do they not understand that socializing the cost of subsidized milk is the price of admission to access to a stream of privatized profit?
The Skeptical Entrepreneur is forced, sadly and even a little bit reluctantly, to the conclusion that these shrill, fringe groups do not, in fact, understand the second- and third-order ramifications of their ideology. That's too bad - one would hope that people in charge of billions of dollars worth of assets would be a little more teleological - but at least there is job security in it.
The point that is being missed in all of the hoopla about a spike in dairy prices is that, in the end, the only people who would be hurt by the expiration of Federal dairy subsidies would be, not the dairy producers, not the consumers, but the other [non-supermarket] [retail] businesses whose potential revenues would have gone to the supermarket sector to pay for more-expensive dairy products.
TSE is left to marvel at the short-sightedness of the "starve-the-beast" mentality that animates so many fiscal conservatives. Their misguided, undisciplined zeal for cutting Federal spending and demonizing "takers" presents an unacceptable level of risk of damaging the economy, in the interest of "stabilizing" and "strengthening" the public purse. The only "beast" who would be harmed by allowing dairy subsidies to expire would be the retail sector's ox, gored by the free market's re-allocation of scarce consumer dollars toward more-expensive milk.
Does the "cut-the-budget" crowd simply not understand their own mantra of "socialize costs?" Do they imagine that costs should be socialized only among the "Other" (read: consumers), and not among entrepreneurs and enterprises?
Do they not understand that the cost of maintaining the inflow of consumer dollars into their tills is the outflow of their tax dollars into the Federal till, to fund dairy (and other agricultural) subsidies? Do they not understand that socializing the cost of subsidized milk is the price of admission to access to a stream of privatized profit?
The Skeptical Entrepreneur is forced, sadly and even a little bit reluctantly, to the conclusion that these shrill, fringe groups do not, in fact, understand the second- and third-order ramifications of their ideology. That's too bad - one would hope that people in charge of billions of dollars worth of assets would be a little more teleological - but at least there is job security in it.
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