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Quotation of the Day…

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… is from page 130 of the 1999 Liberty Fund edition of the late Nobel-laureate James Buchanan [2]‘s 1967 volume, Public Finance in Democratic Process [3]; here, Jim summarizes some general conclusions of late-19th and early- to mid-20th-century Italian public-finance scholars, most notably Amilcare Puviani [4]:

The ruling group attempts, to the extent that it is possible, to create fiscal illusions, and these have the effect of making taxpayers think that the taxes to which they are subjected are less burdensome than they actually are. At the same time, other illusions are created that make beneficiaries consider the values of public goods and services provided them to be larger than may actually be the case. The various institutions of taxing and spending are so organized as to create this set of illusions.

DBx: Jim himself believed that it is possible, through a sound system of selecting constitutional rules, to reduce the extent of – and the damage done by – these illusions. I am less optimistic on this score than was Jim. (Pictured above is Puviani.)

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