Epstein on James Surowiecki’s “Corporate Welfare Queens”

The New Yorker’s Closet Libertarian
Richard A. Epstein
Defining Ideas
October 16, 2012

Is Mitt Romney a small-government hypocrite? James Surowiecki’s recent New Yorker piece, “Corporate Welfare Queens” takes Romney to task on just this point. The man who “now seems to fancy himself as a small-government zealot, who promises the end of the culture of entitlement” has had very little to say about “the many American companies whose profits rely, in one form or another, on government assistance,” Surowiecki argues.

His clever title is an obvious riposte to the conservative demonization of Welfare Queens. These are people, usually women, who are charged with collecting excessive welfare benefits through fraud and manipulation. Surowiecki notes that while Mitt Romney, who unwisely attacked 47 percent of the American population for being the beneficiaries of the welfare state, has turned a blind eye toward the corporate welfare queens who snag untold billions in undeserved revenues from the United States government by an even broader range of dubious legal practices that have been sanctified by a corrupt political system.

It’s Time For a “Givings Clause”

Surowiecki’s argument is an unacknowledged tribute to the very libertarian doctrine that he mocks. The libertarian position demands that we examine all government action on a presumption of distrust. In particular, this means that great care should be taken to see that government assets should not be given away to private interests. Rather, they should be transferred through competitive actions that require private parties to pay just compensation to the public treasury for public assets that they buy or lease. In a 1987 article in the Cato Journal, I made the claim that a well-functioning constitution needs to have not only a Takings Clause but also a “Givings Clause.”’

Richard A. Epstein