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When Good Intentions Bring Bad Results
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If you thought that American farmers was the only group powerful enough to hold a firm grip on policy makers, you haven’t met the “Landing Beach Committees” of Ghana’s fishing sector.

It’s a rare phenomenon, but it’s been known to happen, some subsidies aimed at helping the poor end up benefiting the rich, particularly in the rural sector and in basic public services. If ever there were a classic demonstration of how subsidies fail to achieve their intended effect, i.e. cushion the poor and vulnerable in society, the perennial premix (a special type of fuel that is used for fishing canoes) confusion is it.

Franklin Cudjoe, Kofi Bentil, and Bright Simons of IMANI Center for Policy and Education see no economic justification for subsidizing premix fuel for fishermen. The practice, they say, is “A political dance favored by the vote-obsessed elites of our major political parties… It is also a self-reinforcing system of perverse incentives for all those lucky to be caught up in the situation’s management.

Source: atlasnetwork.org

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