The Presidential Inauguration: A Prime Example of Why Politicians are Dumb

by A Blinkin on January 20, 2013

Here’s a fun fact for you to impress your co-workers at the water cooler: DID YOU KNOW…the Presidential Inauguration used to take place on March 4th, the day of the year which the Constitution first took effect (1789). After FDR, this date changed to January 20th. So why is the Inauguration Ceremony being held on January 21? Well, technically President Obama is making a private oath of office on January 20th. Monday is just the party.

Allow me to get the party started with a brief lesson in Economics. It will give you a good understanding of why politicians are dumb.

Inauguration Tickets

Congress gives out tickets to the Presidential Inauguration FOR FREE, typically by lottery. Joe Schmo enters his name into the lottery, his name is then selected, and the tickets are his. What Joe Schmo does with his tickets doesn’t matter.

Or does it?

What if Jane Doe REALLY wants to attend the inauguration, but her name was not selected in the lottery? This inauguration means the world to Jane, so she’ll do anything to ensure a spot in the crowd. Joe Schmo, being a savvy business man, decides to sell his ticket to Jane Doe for $500. Jane doesn’t have to buy this ticket, but she places a value on her attendance at $500 – and she buys the ticket.

Everybody is better off. Joe Schmo gets $500. Jane Doe gets to attend the inauguration. And the President speaks to a full crowd.

Unfortunately, the transaction is WAY TOO SIMPLE for a politician to understand. Some stereo-typical Democrat is OUTRAGED at  having to pay to attend the inauguration – which is supposed to be free.

In this specific case, the Democrat is Senator Chuck Schumer of New York. The Senator has worked diligently to ensure that neither eBay nor Craigslist allows listings for the inauguration. Here’s a quick quote from the Yahoo article:

“eBay and Craigslist are doing the right thing in stopping the sale of scalped tickets to one of our nation’s most sacred events.”

“I hope that everyone who has an Inaugural ticket will think twice before posting these tickets on any ticket resale site,” the senator added. “This is a chance for people from all 50 states to celebrate our democracy, not for ticket scalpers to make a quick buck.”

Optimal Solutions

  1. Allow Joe Schmo to sell his ticket to Jane Doe. This benefits both parties.
  2. Auction off the tickets and rebate these funds to American taxpayers. This benefits 47% of Americans +1.
  3. Auction off the tickets and apply this revenue to our growing national debt. This benefits everyone.
  4. We could give away the tickets for free. Tell eBay and Craiglist to monitor their sites. Punish lottery winners for selling their tickets. And prevent those that want to buy tickets from buying them.

Yep – I like the last one!

Good thinking, guys!

  • Darwin’s Money

    This country’s broke, we should just do away with it (or find a Dem sacred cow to cut elsewhere to pay for it). Seriously, my company is not doing as well and we’ve done away with Christmas parties, most travel and compensation has dropped. Imagine if we were LOSING money at the rate the US govt runs a deficit? We’d certainly not be doing

    Inaugurations!

  • John S @ Frugal Rules

    Love the post! I think we could scale WAY back on the money spent on this frivolous event. Sure, it might be historical, but why spend such amounts of money? My brother actually got to go to it yesterday as a friend of his had an extra ticket.

  • http://twitter.com/wstreetstock Brett Wilson

    Great post! Having the inauguration in the in March was necessary when the country was founded because results could take a while to come in and travel time. However, the no longer the case by the 20th so we did away with it.

  • http://twitter.com/Nunzio_Bruno Nunzio Bruno

    I love that you basically broke down consumer and producer surplus – great post! I agree that if you win in the lottery you should be able to do with them what you please. If you can’t find a buyer, the prices may drop per ticket along with a slur of other possibilities. As to the solutions I liked all 4 of them – just don’t think the middle two would carry much weight, more of a emotional win as far as applying it to outstanding debt. Free market or bust :)

  • http://simplefinanceblog.com/ Elizabeth_SimpleFinance

    I like #3 the best… and take mild offense at #2 :)

  • AvgJoeMoney

    What Darwin said. BUT even broke people love a parade. ;-)

  • http://www.myjourneytomillions.com Evan@MyJourneytoMillions

    Or do not have a party that cost the tax payer how many millions?

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