I know, I’ve said it a thousand times before, almost all subsidies are a waste of time, and end up costing more than any benefit they provide.
There are three reasons:
First, if you are getting a subsidy, you don’t have to worry so much about careful planning, or financial responsibility (because someone else – the taxpayer, usually – is picking up the bills), or whether anyone will like or buy what you produce. In other words, subsidies enourage a lack of efficiency, and the production of goods and services which nobody wants.
Secondly, subsidies are inefficient. Subsidies mean taking money off some people and giving it to other people at the whim of a politician or lobby group. This bad enough, but the process itself, its planning, administration and record-keeping, all cost time and money – which means substantially more money is taken from the taxpayer than ends up in the hands of the recipient. In some instances, the cost of assessing a person or group’s eligibility for a subsidy is more than the value of the subsidy itself.
Thirdly, subsidies (and food and clothing and other material aid, except in the most dire emergencies) discourage potentially viable businesses, and therefore discourage investment of both time and money in creativity, in business, in research and industry. The long term consequence of this is that businesses, artists, causes, etc, that might be successful on their own merits are disadvantaged.
In developing nations, local business people cannot compete with shiploads of food and clothing aid. So the West’s generous subsidies mean local people have no incentive to invest in developing the primary production, trade and industry which produce long-term wealth.
In relation to art, it is sometimes argued that good art is not necessarily commercial. Something may not sell well, and yet be worthy of support.
But who decides this? If no-one wants something enough to pay money for it, on what basis is it judged to be good?
I cannot think of a single piece of visual art or music, or a play or film that people have wanted and enjoyed, or which has shown itself to have lasting value, which depended on subsidies for its production.
On the other hand, there are hundreds of talented artists, musicians and playwrights who stand on their own feet, and who have made the world a more interesting place, by showing us truth or beauty or meaning where we had not seen it before.
My friend Neil Sheppard is one. Neil makes a good living from producing good paintings – that is, paintings that say something worthwhile, and that people enjoy enough to be willing to pay for.