A recent commentary by Michael Barone points out the unsurprising truth that American’s tend to move to places where they are taxed less heavily and where the costs of living are cheaper. I say unsurprising, but this obvious little bit of behavioral economics continues to elude even the most illustrious figures in the realm of public policy. It cannot be said enough times: people respond to incentives. When voting at the ballot box fails to yield results, there is always the option to vote with one’s feet, an option which many are happy to exercise in these tough economic times.
Despite the difficulty many modern minds have with this concept, it is not new, and in fact was one of the core pillars of federalism intended by the founders of the United States. By allowing states and localities to, for the most part, make their own laws that conform to their own needs and cultures, the founders put in place a series of little laboratories for democracy, where a wide variety of different approaches to the law provided examples of what works and what doesn’t. Perhaps more importantly, since people were free to move from one locality to another, it allowed individuals the freedom to choose the sorts of communities in which they wanted to live and work, complete with a corresponding social and legal framework.
In recent years, this model has been increasingly abandoned in favor of greaert top-down, federal control. Lawmakers in Washington want their laws to apply to everybody, not just the people from their home district, especially when the laws in question restrict freedoms or extract tax revenue likely to displease voters. Legislative efforts like the Marketplace Fairness Act are designed to eliminate the people’s ability to relocate in order to live under more favorable laws.
This is a move in the wrong direction. We need more decentralization, not less, and not just at the state level. Why not let individual communities determine their own rules? We already see this to a limited degree in neighborhood organizations. What if they were able to go further, personalizing their laws to meet the demands of their residents? Why not have a diverse marketplace of laws as we do for every other product on the market? Basic economic thought holds that the larger a number of sellers in a marketplace, the more benefits to the consumer in terms of decreased prices and increased choices. Why not apply this kind of thinking to laws as well?
Obviously, we do not want to let individual neighborhoods violate basic human rights by implementing things like slavery or ritual sacrifice, but what’s the harm in letting one area permit, for example, smoking in restaurants while another forbids it? Then, people who want to smoke will have a place to go that tolerates their habit, while others who fear the effects of secondhand smoke can rest easy in the knowledge that they can dine in comfort and safety. Not only would each consumer be able to satisfy his own needs without imposing them on others who think differently, but we would be blessed with a plethora of economic mini-experiments, where the results of various policies could be examined in a way that is currently only rarely possible.
Decentralization of the law and allowing citizens to vote with their feet represents a way for individuals to live the way they want without the values of others being imposed on them from on high. It promotes stronger communities and more responsible social attitudes, since the societal norms are built by residents who voluntarily choose to live there instead of by bureaucrats who have little understanding of the culture they govern.
It’s the ultimate in democracy. Let people vote with their feet, and then let’s see where they go.