Last week I presented an example of a voluntary market transaction with negative externalities for the local community. With a pack of journalists trailing behind him day and night, it must have been easy for Sofia's mayor to crunch the numbers. How many politicians would take the side of one landowner against the interests of hundreds of parents with more than a million potential voters watching the evening news? He met with the protestors girded by a reputation of being a problem-solver from his days as a firefighter and chief of police.
The mayor made a promise and consequently used all of the available executive powers at his disposal to stop construction-one of his many swift actions in response to popular demand that won him the office of the prime minister during national elections that year. But was there a "market failure" that necessitated his intervention? Classical liberals like Friedrich Hayek would most likely disagree since in this case property rights were clearly established; there was a well-functioning market for land and easy access to information. The neighbors were free to form an alliance, raise funds, and negotiate the purchase of the land or sign a long-term lease.
They also knew that the building would be worth more than a million dollars to the future homeowners. The parents loved their children but none of them thought it was worth it to pay their share of the market price in order to keep the playground. And so they abused the political system, acting as a tyrannical majority against the inalienable rights of their fellow men. Fortunately for the landowner, the courts acted in defense of the law that respects those rights (the outcome may have been different had the judge been up for reelection instead of appointed).
The walnut tree that protected me and my friends from the sun and the rain during so many games of marbles is gone. It makes me sad to see that playground replaced by a building. Nevertheless, as an economist I salute the fact that a government intervention without economic justification was overturned. What is more, the natural rights philosopher in me knows that in this tiny case Bulgaria's independent judicial system has done its job of serving blind justice.