Friday night football is a tradition in the state of Texas, with high school games often attracting very large crowds. Today, I came across a couple of news stories that suggest this cultural tradition indirectly impacts public policy.
Bloomberg has a story about Governor Abbott’s attempt to expand school choice in Texas. He is running into predictable opposition from the Democratic Party, which tends to support teachers unions. But Democrats are in the minority in Texas, and Abbott must also contend with opposition from rural Republicans:
The efforts have been met with stiff opposition not only from Democrats – traditional allies of public education – but also rural Republicans who fear that more parents pulling their kids out of the local schools will decimate funding for institutions that serve as community hubs and a source of regional pride. An additional factor for many GOP lawmakers outside cities is that their sparsely populated districts often don’t have any private schools, limiting the usefulness of the [education saving] accounts for those who don’t want to homeschool their children.
Perhaps government monopolies seem less oppressive in smaller towns where citizens have more influence over public policy. For example, I suspect that rural Texas school boards are less likely to impose “woke” approaches to teaching. If the local football team is a “source of regional pride”, then school choice seems less appealing than in a bigger city such as Dallas or Houston.
A post written by Matt Yglesias looked at a very different industry, but reached a similar conclusion:
There’s a very widespread misperception that the biggest companies have the most clout in politics, when actually highly fragmented industries like auto dealers have more clout as a collective. Just a small example is that when congress was putting the Dodd-Frank financial regulation overhaul together, Elizabeth Warren rolled the entire financial services industry and got her Consumer Financial Protection Bureau created. But to round up the votes in congress, she had to swallow an exemption from CFPB oversight for auto loans because the car dealerships had the clout to demand that.
The key to dealership strength is that there’s a dealership owner (or several) in every district, and they are rooted in the local community — often involved in sponsoring sports teams, visible on local television news, and generally playing a major role as a local influencer. People feel sentimental about local businesses. Republicans like free markets but they love businessmen, so if businessmen want to back an anti-market policy, Republicans are inclined to agree. Democrats are more skeptical of businessmen but less enthusiastic about markets, so it lands in the same place.
In California, the Democratic Party is far more powerful than in Texas, and hence the prospects for education reform are much bleaker. Indeed, Abbott may succeed in the end despite rural opposition. But California is more market friendly in terms of auto retailing, with new manufacturers such as Tesla able to sell directly to consumers. (This does not apply to manufacturers with existing dealer franchises.)
Many people on both the left and the right assume that the US is a free market economy, although they may differ on whether that state of affairs is desirable. In fact, the auto retailing industry is fairly typical; there are hundreds of similar examples. Most US industries are heavily regulated and the regulations generally favor producers at the expense of consumers. We have a large pro-business political party and a large pro-bureaucrat political party. We do not have a significant pro-market political party.