Wax on, Wax off!

Here’s hoping for the “off.” At least for Representative Henry Waxman, the California Democrat who was recently the subject of a book, The Waxman Report. The Washington Post recently published a fawning book review which contained the following:

“But the corruption of Congress, the corrosive influence of money and lobbying and the failure of one Congress after another to address the country’s biggest problems have done much more to undermine the reputation of our legislative branch than Watergate and Vietnam. To his credit, as the new chairman of the House Energy and Commerce Committee, Waxman is currently addressing one of the nation’s most complex crises: climate change.”

That people fail to make the connection between an intrusive government and lobbying is one reason why we must continual bemoan the “influence of money” in Congress. As government regulates more and more, more and more people are affected which naturally leads to lobbying. The only reason people have to lobby is to attempt to have government legislate policies that positively affect them.  Mr Waxman’s climate change will be no different looking at the bill recently passed by the House.

One of the more obvious cases of this is regulation of businesses. Back in the day, Bill Gates used to brag that he never paid attention to what was going on in Washington. Then suddenly the Department of Justice got involved with a possible antitrust lawsuit against Microsoft. Gates realized his mistake and quickly hired Washington lobbyists and consultants to preserve Microsoft’s interests. He later lamented:

I’m sorry that we have to have a Washington presence. We thrived during our first 16 years without any of this. I never made a political visit to Washington and we had no people here. It wasn’t on our radar screen. We were just making great software.

The same occurred with Wal-Mart. Sam Walton rarely disguised his disdain for Washington. Then Congress and state assemblies started passing laws that adversely affected Wal-Mart (e.g. mandating health coverage or anti-Wal-Mart zoning laws like in Maryland). Wal-Mart quickly opened up a Washington office and engaged a team of lobbyists.

These examples are illustrated in Ayn Rand’s Atlas Shrugged where Hank Rearden focused solely on his company, trying to improve his product and increase sales with only Wesley Mouch on payroll as a Washington lobbyist. Then the government started to oppose Rearden Metal because other steel firms had more lobbyists and could influence key officials to try to stifle competition from Rearden.

This is the unintended consequence of expanding government in the free market: The business with the most lobbyists uses government to shut down competition. Phillip Morris and other large tobacco firms used this with the tobacco lawsuit settlement and now Wal-Mart is trying to use it with health care now that President Obama has promised them “a seat at the table.”

The review ended with this aspiration:

“The Waxman Report explains, at least, how Congress can work, and it is fun to read. You finish it with gratitude to the voters of Beverly Hills and nearby areas who keep returning this ornery fellow to the House to challenge entrenched special interests. More Henry Waxmans on both sides of the aisle would give us a much better Congress than the one we’ve got.”

Well, not really. We should only want more Henry Waxmans if we have a national death wish. Basically, if we eventually end up with more Henry Waxmans, we’ll end up with more and more lobbying and government being used to stifle competition by big business. We ignore the consequences of increased government intervention at our peril.