The Privatization of Roads and Highways - Ludwig von Mises Institute

140 The Privatization of Roads and Highways
No minor rearrangement of an indifference curve can erase
the harm done to a man so confronted. At best, Samuelson’s suggestion
of permitting the indifference curve to bend forward provides
a means of representing the problem—a geometrical way
of stating the dilemma—but hardly a solution to it. It is as if, in
response to a complaint that the economy is constantly in a state
of disequilibrium, Samuelson were to offer to draw supply and
demand curves, showing price to be other than at their intersection.
Such a drawing would be an illustration of the difficulty, not
a solution to it. It cannot seriously be maintained that a man’s lot
will be bettered by forcibly extracting his money in taxes, if it is
intended that these funds be spent on a good that for him is detrimental.
The objection cannot be dissolved by pointing out that
the situation where one man’s circus is another man’s poison can
adequately be portrayed by forward-falling indifference curves.
IS GROUP ACTION IRRATIONAL?
We next consider a version of the public-good argument put
forth by Mancur Olson. It is his contention that “unless the number
of individuals in a group is quite small, or unless there is
coercion or some other special device to make individuals act in
their common interest, rational, self-interested individuals will
not act to achieve their common or group interests.” And, as a
corollary, only “groups composed of either altruistic individuals
or irrational individuals may sometimes act in common for
group interests . . . even when there is unanimous agreement in a
group about the common good and the methods of achieving
it.” 55
Olson limits his analysis to groups whose avowed purpose is
the furtherance of the economic well-being of their membership:
“The kinds of organizations that are the focus of this study are
expected to further the interests of their members.” 56 A group
55Mancur Olson, Jr., The Logic of Collective Action (New York: Sehocken
Books, 1965), p. 2.
56Ibid., p. 6.