Commentary
Adam Smith said it all in his work “Wealth of Nations”: “The real price of everything, what everything really costs to the man who wants to acquire it, is the toil and trouble of acquiring it.”
Interpreting “toil” as the money price and “trouble” as the transaction cost, we see that an increase in either the money price or the trouble results in cost increases. With demand curves sloping downward, reducing the price or trouble makes people better off as they are substitutes for citizens.
However, bureaucracies do not see these costs as substitutes at all. This leads to citizens paying substantial “trouble taxes” to save money for bureaucracies, resulting in avoidable inconveniences.
For instance, at passport control barriers in airports like Charlotte and Dulles, long lines due to a shortage of agents impose a significant “trouble tax” on travelers. The inefficiency in hiring more agents to reduce wait times results in deadweight loss.
Similarly, in scenarios like parents buying school supplies for their children, the burden of time and effort falls on individuals due to inefficient bureaucratic processes. Centralizing procurement could streamline the process and lead to social efficiency.
The use of bureaucracy as a service provision method highlights the inefficiency and frustration faced by citizens. While citizens bear both money and trouble costs, bureaucracies only consider the monetary cost, leading to a disconnect in incentives.
This disconnect often results in a cycle of tax cuts reducing funding, which in turn reduces services and imposes a significant “trouble tax” on citizens. Without competitive alternatives, citizens are left with no choice but to bear the burden of inefficiencies.
Instances like long wait times at DMV driver’s license stations in North Carolina further exemplify the consequences of prioritizing budget savings over efficient service delivery. The refusal to hire additional staff leads to hours-long wait times for essential services.
Overall, the failure to address these inefficiencies in bureaucratic systems perpetuates unnecessary burdens on citizens and highlights the need for more efficient and citizen-centric approaches to service delivery.
This type of government failure, caused by state employees prioritizing money over the time of citizens, is a result of bureaucracy and monopoly power. The system lacks incentives for convenience or efficiency, as there is no profit motive or reward for providing good service. Citizens are essentially compelled, under threat, to endure whatever “service” the state chooses to offer.
