Rent Seeking in SF: 'The Midas Plague'

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Rent Seeking in Science Fiction: The Midas Plague

Science fiction often exaggerates real-world tendencies until the absurd becomes visible. Frederik Pohl’s 1954 novella The Midas Plague (which I read as a young teen) is a case in point. Where most mid-century dystopias warned of shortages, rationing and austere futures, Pohl imagined the opposite problem: a world drowning in overabundance.

His premise is simple enough. Automation has advanced to the point where factories churn out limitless consumer goods at negligible cost. The problem is demand: no one actually wants the mountain of tat that pours from the assembly lines. In a market system this would mean bankruptcies, idle plants, falling prices, and eventually equilibrium.

But in Pohl’s world, society refuses to let the productive apparatus shrink. Instead, the state steps in to enforce consumption quotas. The poor are compelled to eat, drink, wear and dispose of endless commodities; their burden is to consume beyond desire. The rich, by contrast, are privileged to live sparsely; they forgo this orgy of waste. 

Simplicity becomes a status symbol, while the underclass gorges on surplus in a parody of plenty.

'America, where the poor people are fat'.

This grotesque inversion makes for good satire, but it also requires economic analysis. What exactly is going on here? The answer lies in the concept of rent seeking.

Economists use this term to describe situations where individuals or groups manipulate political and legal structures to secure income without creating new value. Instead of competing to serve customers, they capture the state and force through laws or regulations that guarantee their revenue stream. Classic examples are protective tariffs, agricultural subsidies, or the procurement of gold-plated exquisites in the military-industrial complex.

In The Midas Plague, rent seeking is taken to its extreme. Producers - facing a world glutted with their output - lobby for a system where their goods must be consumed regardless of demand. The state obliges, turning compulsion into law: every citizen must devour their allotted quota. Value is not created here; it is destroyed. Consumers are made worse off - literally sickened - while producers are shielded from market discipline.

The costs of abundance are socialised, the rents privatised.

The satire bites because it echoes real practice. Think of American farmers paid to destroy crops while food is scarce elsewhere. Think of armaments produced at vast cost with questionable utility, justified by political scaremongering. Or of “zombie firms” kept alive today by cheap money and state backstops, resources locked into unproductive channels. Pohl’s vision is exaggerated, but the underlying economic pathology is sadly familiar.