Coolican echoes Bastiat, shows problem with businesses using government to stifle competition

Victor Joecks

Just like it’s wrong for government take from the rich and redistribute their wealth to others, it’s wrong for businesses to use the power of government to stifle competition.

J. Patrick Coolican points out one way that could happen in Las Vegas.

We often hear that businesses wish government would merely get out of the way. Just as often, however, I see businesses lobbying government to kill off the competition.

In the latest example, the Las Vegas City Council is mulling protecting Downtown brick-and-mortar restaurants from their wily new competitors: food trucks. As my Las Vegas Sun colleague Joe Schoenmann reported recently, the owner of Uncle Joe’s Pizza on Fremont East was outraged that “there, in front of his pizza joint, was parked a food truck. And it was selling pizza, no less.”

How dare they?! Next thing you know, someone is going to open a pizzeria next door! So now the City Council is considering an ordinance that would force food trucks to be parked at least 300 feet from an established restaurant-nearly the distance from home plate to the right field wall in Yankee Stadium-and operate there for just four hours in a 24-hour time period.

Unfortunately, businesses using the government to hinder their competition are not a new phenomenon.

Frédéric Bastiat (1801-1850), a French economist, details how government authority is perverted and misused in a short and amazing book called The Law. While Bastiat is describing a generality here, notice how the above story is a perfect “real life” example of what Bastiat describes.

Sometimes the law defends plunder and participates in it. Thus the beneficiaries are spared the shame, danger, and scruple which their acts would otherwise involve. Sometimes the law places the whole apparatus of judges, police, prisons, and gendarmes at the service of the plunderers, and treats the victim-when he defends himself-as a criminal. …

How to Identify Legal Plunder

But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime.

Then abolish this law without delay, for it is not only an evil itself, but also it is a fertile source for further evils because it invites reprisals. If such a law-which may be an isolated case-is not abolished immediately, it will spread, multiply, and develop into a system.

The person who profits from this law will complain bitterly, defending his acquired rights. He will claim that the state is obligated to protect and encourage his particular industry; that this procedure enriches the state because the protected industry is thus able to spend more and to pay higher wages to the poor workingmen.

Do not listen to this sophistry by vested interests. The acceptance of these arguments will build legal plunder into a whole system. In fact, this has already occurred. The present-day delusion is an attempt to enrich everyone at the expense of everyone else; to make plunder universal under the pretense of organizing it. (Emphasis added.)

If you haven’t read The Law, it is available for free online here. Read it. It is an amazing book that clearly describes the principles of a just government.

Coolican concludes his article with a line that Bastiat could have written himself.

As (Slate’s Matthew) Yglesias notes: “The fact that business owners would prefer not to face competition is not a valid regulatory purpose.” Let the food trucks live.