Ideologically Convenient...Economically Corrosive
By Amy Willis
21st century America has been hit by a “double whammy malaise,” according to the Niskanen Center’s Brink Lindsey, one of two guests joining host Russ Roberts on this EconTalk. Lindsey joins his co-author, Steven Teles, to talk about their new book, The Captured Economy.
Lindsey and Teles argue, in an appeal to both the political Left and Right, that inequality has been worsened in America by special interests who steer policy to benefit themselves, and that the concentration of political power hampers both innovation and economic growth to a large degree.
1. As mentioned above, Teles and Lindsay maintain that their argument should hold appeal for both the Left and the Right. What is it they think will appeal to each, and what what do they say are the blind spots of the political Left and Right? To what extent do you think their argument will appeal to each, and why?
2. How do policy-makers create demand for economists, according to Roberts, and how does this cause problems for politics? (Hint: You might also want to check out this previous episode with Luigi Zingales for inspiration.)
3. Teles suggests that the standard model of regulatory capture is overdrawn. What does he mean by that, and why then do special interests still pose a problem for politics today?
4. The conversation spends a good bit of time on what the three see as the problems with the US finance industry today. Of the several problems they discuss, which do you think is the most significant, and why?
5. How has occupational licensing failed in its purpose, according to Teles? (Did you know there is no license for performing heart surgery?) Would you be comfortable having your teeth cleaned at a specialty office led by a dental hygienist rather than a dentist? Why or why not?