October 2010
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Juan Williams, “Public” Broadcasting, and Public Choice

Back in 1994, after the Republicans won control of both houses of Congress, there was some discussion of defunding public broadcasting. However, talk was pretty much all that happened. The CPB launched a 2-pronged advertising offensive on their affiliates whose message could be summed up by the following catch phrases.

If public broadcasting doesn’t do it, who will?

Public broadcasting costs the public about the same as a postage stamp per month.

The first did not work out, as their critics responded by pointing out the new choices in cable – A&E, Bravo, etc. (It is worth noting that in the early days of both those networks, their concentration was on arts – not L&O reruns and Queer Eye.) The second was more effective, however.

According to the Census Bureau, there are about 150,000,000 registered voters in the US. Divide that into the $422,000,000 CPB federal subsidy, and the cost of CPB to the average voter is less than $3.00 per year, or 25 cents per month. Couple those numbers with the fact that the majority of CPB programming is benign, and it’s a tough sell to get voters worked up over a quarter per month.

Economists refer to this voter reaction as “rational ignorance.” It’s a simple cost/benefit problem. The cost to the voter in terms of studying the issue and writing to representatives is more than the benefit of saving 25 cents per month in federal taxes. However, to the folks at CPB, their jobs depend on that subsidy. And to the members of Congress who vote on CPB’s appropriations, the cost of risking the voter’s ire for giving CPB other people’s money is small compared to the kudos they receive for their generosity in promoting such a noble cause. Public Choice economists refer to this behavior as “rent seeking.”

Rent seeking is the process of earning income by manipulating the political process as opposed to earning profits though transactions that are mutually beneficial to buyer and seller alike. And if the CPB were the only entity engaging in rent seeking this would not be much of a problem. However, there are many interests involved in this behavior. Milk producers want price supports. Home builders and realtors want the mortgage interest deduction. Sugar cane growers want import restrictions. And then there’s Freddie Mac and Fannie Mae. All of these government interventions into the economy wind up costing taxpayers in the long run, while enhancing the profits of few.

NPR’s ham-handed firing of Juan Williams could not have occurred at a worse time for them. Only a few days out from an election, it has highlighted one of the driving forces behind the tea party movement – a return to Constitutional government. If the folks in DC took their oaths to abide by the Constitution seriously, then none of this would be an issue.

So thank you, NPR, for helping to break the grip of rational ignorance.

fiat lux!

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