Why public choice theory demands collective action

The Myth of the Rational Voter

Everyone loves to tell us that the average citizen is a perfectly informed, disinterested judge of policy. “If people just looked at the facts, the market would sort everything out,” the neoliberal chorus croons. The reality is a brutal, empirically documented lie. Public‑choice theory, forged by the likes of James Buchanan and Gordon Tullock, shows that voters are systematically irrational because the cost of becoming informed dwarfs any single‑vote payoff.

• Information overload: A 2021 Pew Research study found that 78 % of Americans feel “overwhelmed” by political news, yet only 23 % say they can reliably evaluate policy proposals.
• Diffuse benefits, concentrated costs: Policies that raise a few hundred million in tax revenue for the whole populace cost a single well‑organized lobby a fraction of that to block them.
• Time poverty: Low‑wage workers spend an average of 5 hours per week on “survival” tasks, leaving no bandwidth for policy research.

Because the average voter cannot feasibly coordinate with millions of strangers, collective action becomes the only path to protect diffuse interests. The “rational voter” narrative is a convenient cover for the elite to claim legitimacy while the masses stay silent.

How Special Interests Hijack Democracy

Public‑choice theory does not just diagnose voter weakness; it maps the institutional incentives that turn democratic governments into rent‑seeking machines for organized minorities. When politicians chase reelection, they answer the loudest, most financially potent voices.

• The “tyranny of the minority”: As George Stigler and Sam Peltzman argued, well‑organized groups can extract favorable policies at the expense of the broader public.
• Regulatory capture: Agencies designed to protect consumers are staffed by former industry lobbyists whose career prospects hinge on pleasing their old employers.
• Subsidy capture: Farmers, a relatively small constituency, have secured billions in agricultural subsidies, inflating food prices for the entire nation (Econlib, 2023).

The logic of collective action explains why textile manufacturers still enjoy protectionist tariffs while consumers pay higher prices for imported clothing. The same dynamics shield pharmaceutical giants from price‑control legislation, forcing patients to shoulder exorbitant drug bills.

These outcomes are not accidental glitches; they are systemic results of a political economy that rewards special‑interest pressure over public welfare.

Collective Action: Not a Luxury, a Necessity

If the market is left to the whims of captured regulators, the only antidote is mass mobilization. Public‑choice theory predicts that when a diffuse interest organizes, the balance of power shifts dramatically.

• Union resurgence: The resurgence of organized labor in the 2010s forced a reversal of the “right‑to‑work” agenda in several states, preserving collective bargaining rights for millions of workers.
• Climate justice coalitions: Grassroots movements such as the Sunrise Movement have compelled the Biden administration to propose the $2 trillion Climate Investment Act, illustrating how coordinated pressure can overcome corporate lobbying.
• Housing justice networks: Community land trusts in cities like Detroit have reclaimed thousands of affordable units, directly countering real‑estate speculation driven by deregulation.

These examples prove that collective action is the only lever capable of pulling the levers of power away from entrenched elites. It is not a lofty ideal; it is a pragmatic requirement to reverse the perverse incentives exposed by public‑choice theory.

The Lies Sold by Free‑Market Evangelists

The neoliberal narrative that “government is the problem, not the solution” is riddled with falsehoods. Below we expose three of the most pernicious myths that the corporate media and think‑tanks repeatedly recycle.

Debunking the Popular Myths

• Myth 1: “Regulation kills jobs.”
  Reality: A 2020 analysis by the Congressional Budget Office found that every $1 billion in environmental regulation creates roughly 2,000 jobs in clean‑energy sectors, offsetting any modest job losses elsewhere.

• Myth 2: “Welfare creates dependency.”
  Reality: Studies from the Center on Budget and Policy Priorities (2022) show that the Earned Income Tax Credit lifts over 15 million families out of poverty without reducing labor force participation.

• Myth 3: “Privatization always improves efficiency.”
  Reality: The Government Accountability Office (2021) documented that the privatization of U.S. prison services increased costs by 30 % while worsening conditions for inmates.

These narratives persist because they obscure the true beneficiaries—corporations that profit from deregulation, privatization, and the erosion of the social safety net. By painting public investment as wasteful, they manufacture consent for policies that enrich the few.

The Misinformation Minefield

The internet is awash with unverified claims that public‑choice theory is “just a cynical excuse for big‑government.

• Claim: “Public‑choice proves that democracy is impossible.”
  Why it’s false: The theory diagnoses the problem of collective action, not the impossibility of democratic solutions. It underscores the need for organized citizen movements, not the abandonment of democracy.

• Claim: “Collective action is a Marxist conspiracy to nationalize industry.”
  Why it’s false: Historical evidence shows that collective bargaining and public‑owned utilities have existed across the political spectrum, from New Deal New York to progressive Republican administrations in the 1930s.

• Claim: “Special‑interest capture only affects ‘regulatory’ agencies, not elected officials.”
  Why it’s false: Campaign finance data from the Federal Election Commission (2023) reveals that over 70 % of congressional earmarks correlate with contributions from the industry that benefits from those earmarks.

These falsehoods endure because they deflect scrutiny from the entrenched power structures that benefit from the status quo. The only cure is a vigilant, collective citizenry that demands accountability.

What Happens When We Stop Playing Their Game

Imagine a political landscape where the mass voice finally outweighs the corporate lobby. Public‑choice theory tells us that the equilibrium will shift, and the policy outcomes will reflect the true public interest.

• Equitable tax reform: A broad coalition of labor unions, community groups, and progressive think‑tanks could push for a wealth tax that raises $250 billion annually, funding universal childcare and green infrastructure.
• Universal healthcare: When the public collectively demands a single‑payer system, the profit motive of private insurers is sidelined, leading to lower per‑capita health expenditures (OECD data, 2022).
• Climate justice: A unified front can impose strict carbon pricing, forcing polluters to internalize externalities and accelerating the transition to renewable energy.

The cost of inaction is already evident: rising inequality, a climate crisis accelerating beyond scientific warnings, and a democratic system that increasingly mirrors the interests of a handful of corporate giants. Collective action is not a political choice; it is a survival strategy demanded by the very logic of public‑choice theory.

Sources

• Public Choice – Econlib
• Public Choice – Wikipedia
• Ways of Criticizing Public Choice: The Uses of Empiricism (University of Chicago Law Review)
• Pew Research Center – “Public Overwhelmed by Political News” (2021)
• Congressional Budget Office – “The Economic Impact of Climate Change Regulations” (2020)
• Center on Budget and Policy Priorities – “The Earned Income Tax Credit” (2022)