I saw this post on my Twitter feed earlier:
When will people start questioning why their food is so cheap and stop being excited that its so cheap. [sic]
The poster — and I’m not about to give him free advertising — is the owner of a restaurant that charges $18 for a burger. You can understand why he’s upset that people are excited that there are dozens of other restaurants in town that charge less for a burger.
Now, maybe he’s trying to make a point here about the public’s blindness to the impact of food subsidies. And this particular restaurant is one that goes out of its way to use locally grown ingredients. Which only makes his argument more laughably elitist. You would think a restaurant relying primarily on local ingredients would not be charging substantially more than chain restaurants — not a McDonald’s necessarily, but say, a Bennigan’s — for something as basic as a burger. Shaking your fist in the air and crying, “CORN SUBSIDIES!” doesn’t explain this state of affairs.
This restaurant happens to be in a part of the city where zoning and other local government interference drives up the cost of doing business substantially. I bet I could open a restaurant with the same menu (and local ingredients) in a less developed part of the city and charge $6 for a hamburger. And then the local authorities would shut me down for one of a hundred reasons, not the least of which is that I’m offering a service outside the areas “zoned” for commercial and restaurant use.
The point is that government economic distortions are everywhere you look. While it’s useful (and necessary) to focus on certain interventions, such as agricultural subsidies, in isolation, there is always a larger context to keep in mind. And it’s especially important not to let self-interested parties attempt to seize the moral high ground by claiming only their business model avoids the distorting effects of the state.