Entries Tagged 'Government' ↓

Rent-seeking is a technical term few people understand. Put simply, rent-seeking is the effort to gain a privilege from government intended to increase the seekers’ incomes.

You’ll note I used the plurals for the words “seeker” and “income”. That’s because rent-seeking these days is being driven by lobbyists paid to promote the incomes of whole industry sectors or even areas of the world.

It’s no longer individuals or individual corporations seeking privileges from government: it’s groups of big corporations working together through their industry trade associations to use governments for their own self-interest, regardless of the impact or costs to others.

Rent-seeking by whole industries

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Rent seeking is the petitioning of governments for special privileges or monopolies that are made possible by governments’ power to coerce citizens to do things, e.g., pay money or obey laws. The purpose of rent-seeking is to gain a higher income.

Why isn’t rent-seeking called “profit” seeking?

Some say rent-seeking should be called profit-seeking. It is income-seeking via government privileges, but rents and profits are different kinds of income. Successful rent-seekers  gain “economic rents“.

If this is too technical, you could focus on the “privileges” government gives rent seekers. Special privileges containing words like “rights” or “incentives” or “subsidies” that governments grant political income-seekers are usually of a finite duration – one can only lease or rent them.

An example of rent-seeking

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The discussion of the Trayvon Martin case, oops, I meant to say the George Zimmerman case, is currently focusing on the jurors. I can’t help but think it should focus on the judge, attorneys, and witnesses. This is where the real racism, sexism, homophobism and injustice really lies.

This case, a case branded from the start as chiefly about the victim rather than the defendant charged with committing a crime, hit me really hard for a couple of reasons.

One reason is that I’ve lived in the South. Continue reading →