Corruption? In New Jersey?!

This Newark Star-Ledger article was brought to my attention today, although it is a couple weeks old. Who would ever have thought that public officials and religious leaders in New Jersey could be guilty of corruption?

On the political side, apparently an informant "portrayed himself as a big-spending developer willing to pay cash to grease the way for building approvals." He helped bring charges against 44 people in New Jersey and New York, taping conversations of illegal deal-making for two years.

So, basically the politicians were taking bribes that couldn't be masked as lawful campaign contributions. And of course, Chris Christie, hoping to take away Governor Corzine's throne in the up-coming election, proposes reforms including strict punishments and enforcement of campaign finance laws.

Don't get me wrong – I'd prefer almost anyone to Corzine – but piling on more legislation for campaign finance, etc, isn't going to do anything because it doesn't strike at the root of the problem.

Scandals like this only tell me one thing: politicians have too much power. And expecting them to regulate themselves only gives them more power. If there are loopholes in the current campaign finance laws, who do you think wrote them in?

What I thought was interesting is that the bargains made with the political officials seemed to center around building and zoning laws, just one way government grants itself arbitrary power to make it difficult and expensive to do business.

If it's worth it for businesses to pay many thousands of dollars in bribes and risk their reputations as well as criminal punishment in exchange for expedited building permits or favorable zoning laws, then that must mean the cost of dealing legally with the government must be phenomenal!

I imagine waiting several months for a building permit or other permission to build would be costly. Construction and development companies, dealing with such large amounts of capital and long-term contracts, would be certain to have very large fixed costs.

So they have a choice. They can sit on their hands, watching their business leak more and more cash, or they can pay a little extra to get things moving. The larger the costs imposed by government, the more businesses will be willing to pay in bribes. The extra reform and punishments might increase the amount demanded for favors, but it's not likely to stop politicians altogether from sacrificing their integrity, as long as they have the power and the payoff is big enough.

Moreover, it's not like these building restrictions and other arbitrary government powers really serve much of a purpose. According to Thomas Sowell's excellent new book The Housing Boom and Bust, "less than 10% of the land area in the United States has been developed. Trees alone cover more than six times the area of all the cities and towns put together" (page 17).

Sounds like we have plenty of 'open space,' so we're paying the extra costs of available land and development for what? So that politicians can make a little extra granting favors on the side?

If we don't like this corruption, there is only one solution: don't let the politicians have so much power. If they can't keep their hands out of the cookie jar, take away the cookie jar! How much simpler does it get?