Government Means Subsidies for Failing Businesses and Labor Unions

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Steven Frias’s brief history of the Rhode Island Public Transit Authority (RIPTA) provides another illustration in miniature of one of our government’s core problems:

Before RIPTA, most bus service in Rhode Island was provided by United Transit Company. After World War II, personal automobile ownership became more widespread, the suburbs grew, and bus ridership naturally shrank. Consequently, United Transit began to reduce its workforce and scale back its services. In the meantime, the transit workers union sought and obtained more pay and benefits, and United Transit raised bus fares to pay for these increasing operating costs. Eventually, United Transit began to operate at a loss.

In 1964, when United Transit refused the union’s demands for more pay, job security, and much larger pensions, the union initiated a strike that lasted two weeks. In response, Gov. John Chafee and Henry Molloy Jr., a transit union leader, supported creating a public transit authority to take over the United Transit bus system.

Such government activities are nothing other than crony capitalism, vote-buying redistribution schemes, and money transfers to labor unions.  People in all three groups — the business men and women who want to transfer risk to taxpayers, the people receiving government subsidies, and the employees who want to elect the people with whom they’ll be negotiating — elect politicians who promise to take money away from other people and give it to their political supporters.

It’s that simple.



  • Mike678

    Funny. We tell our children not to feed wild animals because they will become dependant and cease making efforts to be self-sufficient. I wonder how the country would be if we applied these lessons to ourselves….

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