But What If No One Wants To Come? Part Two

“The plans differ; the planners are all alike…” - Frédéric Bastiat

　
In the video accompanying the post “But What If No One Wants To Come?” there are several political economy, public choice theory and general economic concepts worthy of mentioning.

Private-public partnership is a warm and fuzzy concept politicos love to trot on stage. The concept politicos want to sell the voter upon is that the private sector, the home of efficiency, is going to partner with the public sector, the home of inefficiency and then a magical moment occurs where an efficient outcome results. Nay, nay! As pointed out by Ludwig von Mises in his 1921 book Socialism, An Economic and Sociological Analysis, private-public partnerships produce sub-optimal outcomes with the only worse outcome being a totally public sector endeavor. How so?

Politicos through the mechanism of government use bureaucrats to deploy their dealings. Bureaucrats are by design cautious characters that take no risk. Meanwhile private sector entrepreneurs are risk takers. The mixture of the risk adverse and the risk taker inevitably produce a sub-optimal outcome. Enterprise is a risk taking venture with the bureaucrat being a fish-out-of-water wanting to take little or no risk. Meanwhile the risk taking entrepreneur is stymied by the bureaucrat’s need to be risk adverse, with the result in the main and upon normal occasion, being a sub-optimal outcome. (1)

Incumbent politicos like to show potential voters that they are “doing something”. The “something” proposed can easily be highly uninformed policy. Notional proposition based policy rather than evidence based “something(s)” are routinely proposed by politicos. How can they propose such non-evidence based propositions? The politico knows that contrary to popular belief, voters are uninformed. Voters are rationally-uninformed as the price to become informed is outweighed by the cost (deploying their time and resources elsewhere i.e. the alternative). Hence uninformed policy matches an uninformed electorate.

The “something” proposed in many cases comes in the form of a “monument building exercise”. Politicos love to build monuments to themselves. Monuments depicting the “something(s)”. Moreover, the monument to themselves is generally advertised as anything but a monument to themselves. The monument building exercise is cloaked as doing so for the greater good (whatever that is), for the voter, for you, for the public and generally enhanced as a “legacy for future generations”.

Then comes the complications of central planning of turning the “doing something” into the “monument”. The base uninformed policy, a central plan, inevitably runs into reality. The notional proposition begins to unravel as rather than being spontaneous/emergent order based with free market forces influencing demand and supply, an artificial demand and supply have been created. Hence the central planner has to tweak their “something” in an attempt to fix the many shortcomings associated with notional propositions (non-market, non-evidence based central plans).

And about the legacy and future generations: The incumbent politico’s event horizon is the next election. Therefore the cascading unintended consequences inherent with the deployment of a notional proposition, occurring years into the future, a price borne by future generations of un-born voters, are of no matter to the politico as they will either be dead or out-of-office. Therefore the event horizon of the politico dictates near-term “something(s)” with the “legacy” being no more than the price of failure of near-term something(s) superimposed upon future generations years into the future.

“The inefficiency of political control of an economy has been demonstrated more often, in more places, and under more varied conditions, than almost anything outside the realm of pure science.” - pg. 166, Thomas Sowell, 1999, The Quest for Cosmic Justice

　
Notes:



(1) Socialism, An Economic and Sociological Analysis, 1921, Ludwig von Mises, pg. 256 - 257.


　

Economics is Fun, Part 17: Public Choice

Public Choice: Why Politicians Don't Cut Spending

Veterinary Science on the Skids: More Expensive Pet Care Saves You Money

“Cutting the Gas Tax, Giving Teachers a Tax Deduction

Raleigh, N.C. – Maintaining a strong transportation system is crucial to preserving a growing and productive economy. North Carolinians deserve roads and bridges that safely connect them to their jobs and families, and businesses need high quality infrastructure to move people and products and keep our economy thriving.

But the lack of certainty in North Carolina’s gas tax makes it very difficult for the state to plan and fund road projects. One of our state’s most volatile revenue streams, the gas tax, makes up nearly 70 percent of the fund to maintain roads and bridges and approximately 60 percent of the state Department of Transportation’s budget.

That’s why, with wide-ranging support, the Senate passed a bipartisan bill to cut and freeze the gas tax to 35 cents per gallon effective March 1. The bill changes how the gas tax is calculated, providing much-needed funding stability to help protect critical transportation projects. It also provides a tax deduction for teachers who purchase classroom supplies out of their own pockets.

Members of the business and transportation communities – including the North Carolina Chamber and AAA Carolinas – along with local governments have all come out in support of the bill.

This balanced plan provides tax relief for all North Carolina drivers while helping ensure the state has the long-term resources necessary to build and maintain safe roadways, bridges and economic corridors.

A recent report released from NCDOH provided a list of projects in both the Highway Fund and Highway Trust Fund that will be delayed if the gas tax drops to projected levels.

Potential project delays included in the list for Guilford County total $20,527,242 ($5,422,982 from Contract Resurfacing, $743,214 from Pavement Preservation, $412,060 from the Bridge Program, $6,550,490 from Primary and Secondary Maintenance Activities and $7,398,496 from the Powell Bill).”

District 27 Newsletter - Volume 2, Issue 2 - February 24, 2015‏

　
Senator Trudy Wade
300 N. Salisbury Street
Room 521
Raleigh, NC 27603-5925

　

　

Being an expert in one field by no means makes one an expert in another field. Hence Veterinary Science might just, maybe, be a stretch regarding public policy in the field of infrastructure and taxation thereof (public finance).

One might consider engaging in a public choice theory adventure and examine the above news release to see if one can indeed understand pet care more thoroughly:

　

“Maintaining a strong transportation system is crucial to preserving a growing and productive economy. North Carolinians deserve roads and bridges that safely connect them to their jobs and families, and businesses need high quality infrastructure to move people and products and keep our economy thriving.”

Got it, safety and economic growth are the main concern. Very warm and fuzzy stuff!

　

“But the lack of certainty in North Carolina’s gas tax makes it very difficult for the state to plan and fund road projects. One of our state’s most volatile revenue streams, the gas tax, makes up nearly 70 percent of the fund to maintain roads and bridges and approximately 60 percent of the state Department of Transportation’s budget.”

Ah, politicos don’t have enough money and said politicos need a steady stream of other people’s money. Go figure.

　

“That’s why, with wide-ranging support, the Senate passed a bipartisan bill to cut and freeze the gas tax to 35 cents per gallon effective March 1. The bill changes how the gas tax is calculated, providing much-needed funding stability to help protect critical transportation projects. It also provides a tax deduction for teachers who purchase classroom supplies out of their own pockets.”

Oh, new zeniths in rationalization of somehow and in some way all the James and Jane Goodfellow(s) across North Carolina wanted their gasoline tax raised. Yep, politicos just raised your gasoline tax:

Senate bill could push NC gas tax 7 cents higher in future years, news observer.com, 02/10/2015


http://www.newsobserver.com/2015/02/10/4545808_senate-bill-could-push-nc-gas.html?rh=1


　

“Members of the business and transportation communities – including the North Carolina Chamber and AAA Carolinas – along with local governments have all come out in support of the bill.”

That’s the ticket! When notorious special interests and other politicos support tax hikes that makes for good public policy...errr...politics!

　

“A recent report released from NCDOH provided a list of projects in both the Highway Fund and Highway Trust Fund that will be delayed if the gas tax drops to projected levels.”

Great! Raise a regressive tax on the poor and have them build the bridges. Brilliant!

　

One should strongly consider that regardless of the letter appearing after the politician's name, be it D, R or I, they are politicos first and foremost. And as such, one would be well served to consider this quotation:

“So it’s no surprise that governments with vast powers routinely behave stupidly: they are attempting to do the impossible while being overseen by the ill-informed.” - Don Boudreaux

Gasoline Prices, Gasoline Tax and Politicos

Gasoline prices have fallen. Technological innovation has brought more oil supply and therefore more gasoline to the market place. A welcomed price break for consumers. Yet the same welcomed price break for consumers presents a political incentive to increase gasoline taxes. The argument comes with plenty of notional propositions including the need for additional tax due to slack demand of gasoline. That demand, in part, is slack due to vehicles achieving better gas mileage. (1)

Problem is, demand for gasoline is increasing, merely not increasing at the pace of supply available, therefore price falls. Demand is increasing and the tax per gallon of gasoline is generally fixed, meaning twenty gallons of gasoline at $3.69 yields the same tax revenue as twenty gallons at $2.14 (the tax per gallon is fixed whereas the total price per gallon is variable). Therefore, tax revenue is increasing, not decreasing, despite fuel economy of the aggregate fleet. Besides, the fuel economy of the aggregate fleet is a result of politicos and their legislation not a result of individual choice. (2)

Maybe the subject of gasoline tax revenue requires a visit to public choice theory.

The public choice theory argument is: Politicos champion the building of infrastructure and concentrate focus on the price to build and the wonderful things the “building” will bring. Yes, the benefit exceeds the price in their “economic development” calculation (or non-calculation as the case may be). Yet the same politico ilk fails to price long term maintenance price into their “building“, meaning taxpayers, decades later, are forced to pay the under funded or unfunded maintenance feature of the past “building“.

One might conjecture that the situation is akin to the classic case of cascading unintended consequence regarding “monument building”. Monument building is a public choice theory proposition of politicos building things with other people’s money as a monument to their “doing something”. Matter-of-fact, politicos are so vain as to name the monuments after themselves or their favorite past politico of the same ilk. Meanwhile, the-last-man-standing pays the price of cascading unintended consequence regarding “monument building”. The ongoing maintenance, which the monument required but was not properly priced in by politicos, requires a future set of taxpayers (you) to be saddled with the price to maintain something that has not been properly maintained.

The building phase is a period ripe for political constituency building with other people’s money. Surely politicos would enjoy the maintenance phase, and direction thereof, regarding other people’s money. Yes, during the “repairing” stage of their own making due to a under-funded or unfunded phase, politicos would like to spend your money again.

Stated alternatively, the-last-man-standing pays the price of cascading unintended consequence regarding “monument building” of under funding and/or unfunded maintenance. The politico frames the under funding and/or unfunded maintenance phase, and call for more tax revenue, as unrelated to, or exogenous to, their own political dupery and nitwitery of under funding the “monument building” phase in the first place. Hence a new tax revenue stream for a new period of “repair” is called for, and not so incidentally, ripe for political constituency building with other people’s money. Wash, rinse, dry… begin process again. Sweet!

Politicos many times rely on special interests to make their case for tax increases. Special interests that will directly benefit from the tax revenue being spent, focused up them as it were, always champion a tax increase. Enter the U.S. Chamber of Commerce business group and AFL-CIO union federation: special interests extraordinaire! You guessed it! The U.S. Chamber of Commerce business group and AFL-CIO union federation back a tax hike on gasoline. If anyone can solve their own problems with the use of other people’s money, it certainly is this coalition (or more succinctly under the theory of ‘syndicate’). (3) (4)

Returning to the monument building episode, politicos frame the building phase as economic development but rarely if ever price in the long-term maintenance of the monument they propose to build. If the maintenance price is factored in their “economic impact guess”, their wild guess, will look much less rosy. If the taxpayer knew they and those coming after them would be required to pay ongoing maintenance, many times far in excess of the original monument price, taxpayers might reject politicos building things with other people’s money as a monument to their “doing something”.

If one ponders the debate point of infrastructure crumbling, then one might want to find “why” infrastructure crumbles. Is the crumbling due to lack of tax or lack of foresight? Is the crumbling due to monument building with ongoing maintenance not factored in when politicos want to spend other people’s money as a monument to their “doing something”?

Also, the debate point of infrastructure crumbling is sophistry. Road, bridges and general social overhead capital is in better shape today than anytime in the last twenty years. Oops! (5) (6)

One might also consider the political class as the quintessential shirking partner. Yes, the partner that wants part of the gain without putting forth any effort. That’s right, anytime one gains, be it through irksome toil such as work or technological innovation reducing price, any gain one enjoys, becomes fertile ground for the shirking partner, the political class. (7)

Finally, the gasoline tax is a regressive tax hitting lower income individuals hardest. Should the working poor or those climbing the economic ladder from below pay more now that they have increased their meager disposable income due to technological innovation?

　

Notes:

(1) In Low Gasoline Prices, an Opening Emerges for Higher Taxes, WSJ, 01/08/2015

http://www.wsj.com/articles/in-low-gasoline-prices-an-opening-emerges-for-higher-taxes-1420747684?mod=WSJ_hpp_MIDDLENexttoWhatsNewsForth


(2) Ibid

(3) Ibid

(4) A Theory of Syndicate, Pichler and Wilhelm.

http://gates.comm.virginia.edu/wjw9a/Papers/syndicate1.pdf

 (5) New report shows state highways in good shape, USAToday, 09/01/2010

http://usatoday30.usatoday.com/news/nation/2010-09-02-roads02_ST_N.htm


(6) 19th Annual Highway Report, Reason Magazine, 09/02/2010

http://reason.org/news/show/19th-annual-highway-report


　

(7) From Economic Man to Economic System, Harold Demsetz

http://www.amazon.com/Economic-Man-System-Institutions-Capitalism/dp/1107640857/ref=sr_1_1?s=books&ie=UTF8&qid=1420921465&sr=1-1&keywords=From+economic+man+to+economic+system




　

Welcome to Cronyland: Mid and Long-Run Cronyism at Work

“So it’s no surprise that governments with vast powers routinely behave stupidly: they are attempting to do the impossible while being overseen by the ill-informed.” - Don Boudreaux
 
　
-Cronyland-

Apparently Greensboro, NC does not rank highly as a place individuals or individual firms would desire as a relocation destination. Could it be that Greensboro is viewed as an economy that is not chronically and indigenously innovative? With an economy lacking in chronic and indigenous innovation the economy at large will lack dynamism and hence lack in jobs in which people feel vital. Would one want to relocate to such a non-innovative and non-vital environment? (1)

If an economy is not innovative and hence not a dynamic economy in which people feel vital, then what sort of economy is one viewing? Likely one is viewing an economy of the few and not an economy of the many. An economy based on the plans of the few and not the plans of the many. A politically directed economy where what little growth that does occur flows to the few and not the many. One might say an economy with a focus on the few at the expense of the many. (2)

An economy that is chronically and indigenously innovative that produces vitality, such economies are in the main, products of spontaneous/emergent order or what some people refer to as “bottom-up”. The economy is a product of the many. (3)

-Back to the Future-

Most economies that existed prior to the year seventeen hundred were economies of the few. Kings, queens, despots and the like were common. However, after the year seventeen hundred spontaneous/emergent order had produced an overwhelming and unstoppable force of the many. The many wanted to act as free individuals and freely pursue their individualistic needs, wants, talents and desires. The result, the ensuing growth, on a global scale was and still is astounding. (4)

Some two hundred and thirty years into the “bottom-up” revolution a small secondary group emerged known as the predator class which some refer to as the political class. A predator class in that their existence depends to one degree or another, consequent to, preying upon other people’s money:

“The government has nothing to give. The government is simply a mechanism which has the power to take from some to give to others. It is a way in which some people can spend other peoples' money for the benefit of a third party - and not so incidentally themselves" - Milton Friedman (5)

-Political Slight of Hand-

The predator class depends greatly on political slight of hand as they cloak their activities as being directed toward the many. But in essence their activities, in the main, boil down to the plans of the few superseding the plans of the many. James and Jane Goodfellow have been superseded. One ends this exercise with an economy that moves back toward the direction of kings, queens and despots, with political solutions as the only solutions, as political solutions are the predator class bread and butter:

　

Perhaps the greatest achievement of market economies is in economizing on the amount of knowledge needed to produce a given economic result. That is also their greatest political vulnerability. The public can get the economic benefits of such systems by judging results without understanding processes. But in their political behavior, the public must judge processes - including economic processes of which they may be ignorant or misinformed. Public misunderstandings can lead not only to misinterpretations of economic benefit as harm, but to actual harm resulting from policies designed to “correct” perceived problems. Once the process is underway, every perceived problem - whatever its reality or origin - calls for political solution, and these “solutions” tend to create a never-ending supply of new problems to be “solved”. - Thomas Sowell (6)

-Welcome to Cronyland-

　
Returning to Greensboro: Welcome to Cronyland where the only room available is for the plans of the few, and not so incidentally, plans that benefit the few. In Greensboro’s particular case, from coliseum to music hall and all the empty industrial parks in-between, to the use of taxpayer dollars to attempt to attract or retain firms that have grown to depend on crony handouts, the many pay and the few receive. 

Cronyland is a bust for the many and a boom for the few.


Politicos and their ilk come up with master plans (more succinctly notional propositions), financed by the many and their associated tax dollars. The supposed master plan, which generally are far outside their field of expertise of the sponsoring politicos, are then advertised as a panacea. When that plan fails, and the known-known cascading unintended consequence mount related to the notional proposition playing out, a new master plan appears. Yes, the new plan will cause things to be different this time. Alas, same result. Then yet another master plan appears and so on it goes with an unending chain of master plan failure. And when the failure occurs, yet again, the excuse is: You can't make mistakes if
it's everybody else's fault. (7) (8) (9)

 “The plans differ; the planners are all alike…” - Frédéric Bastiat

"That illustrates a general rule: If a private enterprise is a failure, it closes down - unless it can get a government subsidy to keep it going; if a government enterprise fails, it is expanded. I challenge you to find an exception." - Milton Friedman, from the essay Why Government is the Problem

“Government is the only enterprise on earth, that when it fails, it merely does the same thing over again, just bigger” - Don Luskin

 
Notes:

(1) Mass Flourishing, Edmond Phelps

http://www.amazon.com/Mass-Flourishing-Grassroots-Innovation-Challenge/dp/0691158983/ref=sr_1_1?s=books&ie=UTF8&qid=1419451306&sr=1-1&keywords=mass+flourishing+how+grassroots+innovation+created+jobs+challenge+and+change


　

(2) F.A. Hayek, The Constitution of Liberty. Chicago: University of Chicago Press

http://www.amazon.com/Constitution-Liberty-Definitive-Collected-Works/dp/0226315398/ref=sr_1_1?s=books&ie=UTF8&qid=1419451353&sr=1-1&keywords=The+Constitution+of+Liberty


　

(3) Mass Flourishing, Edmond Phelps

　

(4) Why Does 1% of History Have 99% of the Wealth? McCloskey

https://www.youtube.com/watch?v=a0nsKBx77EQ


(5) The Invisible Hand in Economics and Politics, Milton Friedman, Institute of Southeast Asian Studies, 1981, p11

http://www.amazon.com/invisible-economics-politics-Inaugural-Singapore/dp/9971902222/ref=sr_1_7?s=books&ie=UTF8&qid=1419451445&sr=1-7&keywords=The+Invisible+Hand+in+Economics+and+Politics




(6) Knowledge and Decisions, Thomas Sowell, p. 69

http://www.amazon.com/Knowledge-Decisions-Thomas-Sowell/dp/0465037380/ref=sr_1_1?s=books&ie=UTF8&qid=1419451538&sr=1-1&keywords=Knowledge+and+Decisions


　

(7) This Time is Different, Eight Centuries of Financial Folly, Reinhart and Rogoff

http://www.amazon.com/This-Time-Different-Centuries-Financial/dp/0691152640/ref=sr_1_1?s=books&ie=UTF8&qid=1419461465&sr=1-1&keywords=This+Time+is+Different%2C+Eight+Centuries+of+Financial+Folly%2C+Reinhart+and+Rogoff


(8) The Vision of the Anointed, Self-Congratulation as a Basis for Social Policy, Thomas Sowell

http://www.amazon.com/Vision-Anointed-Self-Congratulation-Social-Policy/dp/046508995X/ref=sr_1_1?s=books&ie=UTF8&qid=1419475448&sr=1-1&keywords=The+Vision+of+the+Anointed


　


(9) No, They Can’t, Why Government Fails but Individuals Succeed, John Stossel

　

http://www.amazon.com/They-Cant-Government-Fails-But-Individuals/dp/1451640943/ref=sr_1_2?s=books&ie=UTF8&qid=1419475565&sr=1-2&keywords=No%2C+They+Can%E2%80%99t%2C+Why+Government+Fails+but+Individuals+Succeed

Branding the City State

One might consider that branding a city state, such as Greensboro, NC, by advertising the same city state brand locally, at the price of $35,000, year after year, to the same residents of said city state, is quite ridiculous. That observation would be the “seen”. What about the “unseen”?

Branding the city state is an extension of a zero sum game. A zero sum game, known to power purveyors within the city state and advertised to the same residents of the city state as: “Economic development”.

Economic development, as deployed by directing politicos, through local and state economic development authorities, ends as a zero sum game as locality X merely wins while locality Z loses. The economic pie does not grow, rather one locale gains at the expense of another locale with the economic pie, the size thereof, remaining the same. For instance, building airplanes doesn’t occur in Seattle, Washington, it merely occurs in South Carolina. The same airplane is built, merely in a different locale. Seattle loses and South Carolina wins. But in the aggregate, the economic pie does not grow, rather one locale gains at the expense of another locale.

Moreover, the political exercise of “economic development” is an exercise of picking winners and losers as the exercise favors firm A over firms B - Z within, say, the widget industry. Hence firm A receives special treatment within the universe of widget producers, putting the remaining widget producers at a competitive disadvantage as they did not receive such special benefit. Firms B - Z, the losers, now at a competitive disadvantage to firm A may have to reduce output and consequently reduce inputs such as labor and capital. Firm A, the winner, now at a competitive advantage increases output and consequently inputs such as labor and capital due to their new artificially competitive position, with such increases, occurring at the expense of firms B - Z within the widget industry. Once again the economic pie does not grow, rather, winners gain at the expense of losers.

“Economic” incentives directed by politicos through their quazi-political branch known as economic development authorities must have resources to bestow upon the winners. Since government creates nothing, the resources bestowed must come from the private sector in the form of taxes. Therefore an incremental tax is levied against existing firms and households within locale L, that in turn, after bureaucratic overhead expense, is bestowed upon the winner.

The entire political process of this zero sum game of picking winners and losers through taxpayer funded prizes is framed as a cost/benefit winner. Enter political dupery and nitwitery. The sponsoring politicos through their quazi-political branch known as economic development authorities fashion an economic impact study. An economic impact study, the results thereof, better known to James and Jane Goodfellow as: A wild guess.

The wild guess aka economic impact study is based upon predictive economics which makes many, many assumptions about trends and patterns, none of which may occur. The predictive economics is then dipped in normative economics (the way things ought to be), then a miracle occurs, and the wild guess becomes framed as fact. Positive economics (if this, then these possible outcomes) is thrown out the window as the vast majority of economic impact studies fail to present the counterfactual. The counterfactual being: If the incremental tax levied, which represents the prize bestowed, never occurred, would the now non-taxed firms and households with additional resources available have created as much or more “economic impact”?

Returning to the proposition of branding the city state as an extension of a zero sum game: Is the branding merely an attempt to brand the city state’s economic development activity as a positive game? Stated alternatively, one takes a zero sum game, paints a smiley face on such, in a grand attempt to present the zero sum game as a happy little positive exploit. Hence the “brand” is no more than the city state’s particular brand of zero sum. One’s happy face “brand” might be that of aviation, internet service providers, biotech, green energy and so on. But in the end corporate welfare is not a happy face.

Upon Further Review: 1/4 Cent Sales Tax Increase

Within the realm of public choice theory (politics without the romance) is the proposition of: Focused benefit and diffused costs.

Focused benefit and diffused costs is an observation regarding special interests through politico enablers. The special interest, be it the education establishment or any other special interest, want to acquire a focused benefit upon themselves through a small incremental price extracted from a diffused group.

The insidious mechanics are as follows:

(1) the special interest desires additional funding for their particular constituents making up the aggregate special interest,

(2) the special interest knows that a small incremental price (tax) increase will not be rationally opposed by any one individual in a large diffused group,

(3) the special interest is highly organized and knows the unorganized/diffused group, that the price is to be extracted from, is not organized,

(4) the special interest then recruits politicos to champion the additional funding, with the implicit assumption that the constituents of the special interest will become constituents of the sponsoring politico,

(5) the politico sees an opportunity for a political constituency building exercise through other people’s money (the unorganized/diffused group),

(6) the special interest, with resources supplied by its constituents, mount a very focused campaign for the increased funding while the diffused group has zero resources and a diffused constituency that is highly unlikely to form a focused campaign against the increased funding.


The insidious stratagem of the special interest depends heavily upon: A small incremental price (tax) increase that will not be rationally opposed by any one individual in a large diffused group. An example might help. Jane Goodfellow, one of many price payers (taxpayers) is not going to expend one hundred hours of research to fully understand the issue, spend many evenings attending multiple meetings and become fully aware of the issue proposed by the special interest. Jane Goodfellow’s rational position is to forgo the research and meetings and merely pay the increased price (tax) as the increased price (tax) is a smaller price than the price of the research and meetings.

Moreover, the special interest knows the chances are remote that many Jane Goodfellow(s) will organize themselves together around a particular and small incremental price (tax) increase as the Goodfellow(s) are diffused with no organization.

Insidious to say the least.

　
An additional observation is the rational choice by individual constituents of the special interest. What rational choice? The individual constituent is in effect campaigning to raise his or her individual price (tax). That is, the individual constituent of the special interest faces the same price (tax) increase as the unorganized/diffused group. However, it is rational for the individual constituent of the special interest to support a price (tax) increase upon themselves if the benefits flowing to such individual constituent is greater than the price (tax) increase experienced by the individual constituent.

Therefore, in the particular case of ¼ cent sales tax increase, the aggregated ¼ cent sales tax increase, across millions of dollars of taxable purchases (conceivably billions of dollars of taxable purchases), becomes a very large number of aggregated additional tax collected. The large sum collected is then dispersed to the small focused benefit group of which the constituent is a part. As long as the benefit bestowed is perceived to be larger than the self imposed price (tax) increase experience by the individual constituent of the special interest, then it is totally rational to support a price (tax) increase upon oneself as the price (tax) is less than benefit bestowed.

The rational choice by the individual constituent of the special interest, to increase price (tax) upon themselves, explains a nagging question of why someone feverously supports a price (tax) increase that they themselves will experience. How so? In the main, the outward political position of the individual constituent of the special interest supporting a price (tax) increase, that they themselves will experience, is that such increased price (tax) will create/facilitate some altruistic endeavor. Meanwhile, the inward focused benefit being greater than the individual’s price (tax) is a motivating factor, if not an overriding factor.

Even more insidious, huh?

Welcome to public choice theory, politics without the romance.