Monday, August 18, 2014

While Government's Intentions May or May Not be Good, the Consequences and Results are Almost Always Inferior to Those of the Free Market .... Let the Free Market Work

Lots of well intentioned people extol the virtues of big government and complain about the vices of big business. One is charged with doing good things on behalf of We the People and the other is required to satisfy customers with offerings valued by those customers and at the same time be responsible to its owners for making a satisfactory profit on their investment.

And that's where the confusion comes into play. For example, if we look at schools, including colleges, government rules the roost. Controlling costs and providing value at low prices aren't part of the equation, and prices are therefore sky high. Accountability to provide satisfactory results to customers (students) and owners (taxpayers, including parents and adult students) is low and 'satisfaction guaranteed' isn't even an afterthought.

In business making a satisfactory profit for its owners is indeed the cost of staying in business. If you don't make a satisfactory profit, employees won't have jobs and owners will take their money elsewhere to invest. And if you don't satisfy customers while doing so, you'll go broke and out of business. Either way, you lose.

In government, however, there is no need or even serious attempt to control costs and have revenues exceed those costs, thus achieving a profitable and sustainable status as an ongoing entity. The government instead just raises fees and taxes due to its monopolistic status and ability to tax We the People.

But government is well intentioned, you say. Perhaps it is, at least in many cases, but so what? is my response. The Government Is not a Unicorn, recently written by a professor at Duke, has this to say about that:

"When I am discussing the state with my colleagues at Duke, it's not long before I realize that, for them, almost without exception, the State is a unicorn. I come from the Public Choice tradition, which tends to emphasize consequentialist arguments more than natural rights, and so the distinction is particularly important for me. My friends generally dislike politicians, find democracy messy and distasteful, and object to the brutality and coercive excesses of foreign wars, the war on drugs, and the spying of the NSA.

But their solution is, without exception, to expand the power of "the State." That seems literally insane to me—a non sequitur of such monstrous proportions that I had trouble taking it seriously.

Then I realized that they want a kind of unicorn, a State that has the properties, motivations, knowledge, and abilities that they can imagine for it. When I finally realized that we were talking past each other, I felt kind of dumb. Because essentially this very realization—that people who favor expansion of government imagine a State different from the one possible in the physical world—has been a core part of the argument made by classical liberals for at least three hundred years."

Still not convinced about the real vices, and not the perceived virtues, of big government compared to business and free markets? Then please take the time to read Senate Democrats vs. the Middle Class which reads in part as follows:

"On Nov. 3, 2008, seven new Democratic senators were elected, giving Democrats 58 votes. . . . In 78 days, American voters will render judgment on the record of the Senate Democratic Class of 2008, and on all 35 Democratic candidates seeking to perpetuate their Senate majority.

The Senate's Democratic majority was united after the 2008 election in its commitment to President Obama's progressive vision to remake America. And with a financial crisis afoot, it was determined to not waste the opportunity. . . .

With his party's Senate supermajority, President Obama achieved a series of historic political victories. But the question most voters will have to answer on Nov. 4 is whether this program has been good for working Americans. . . .

While all Democrats claimed to be champions of the middle class and defenders of minorities and women, census data show how their program did not live up to their campaign promises.

Since the Senate Democratic Class of 2008 took control, the average real income of the poorest one-fifth of American families has declined every year, falling to $15,534 in 2012 from $16,962 in 2008 (the 2013 data will be released Sept. 16). The average real income of the lowest quintile of Americans is now below the level it was in 1968, the year when the War on Poverty began its spending surge.

The next-highest income quintile, often referred to as the working class, has also experienced a continuous decline in real income since January 2009. The average income of these Americans has fallen 6.5% and is now $1,182 lower than it was when President Reagan left office.

The third quintile—America's middle class—has seen its average income decline to $62,464 from $65,672. More than half of this decline has occurred since the recovery officially began in the second quarter of 2009. . . .

The Democratic Party's great political victory in 2008 led to the realization of a progressive agenda in the making for a century. But that agenda resulted in economic failure for working Americans. It failed as it has always failed: Progressive policies buy votes but destroy prosperity. The Senate Democratic Class of 2008 and the entire Obama program are now endangered because their program has hurt the very people it was supposed to benefit."

Summing Up

Facts are stubborn things.

Elections have consequences.

The road to hell is paved with good intentions.

The free market, and not government control, works best for all of We the People.

Let's give it another chance.

Thanks. Bob.

No comments:

Post a Comment