Sunday, August 30, 2009

Sheldon Richman on Neglect of Producers

Sheldon Richman, editor of FEE's The Freeman and "In Brief," as well as the author of several books, including Your Money or Your Life: Why We Must Abolish the Income Tax (recommended) explains why politicians are held in such high esteem, while producers and entrepreneurs are virtually ignored:
For most people an understanding of how markets work is not intuitive. It requires the grasp of such elusive ideas as unplanned order, entrepreneurial profit, and prices as capsules of (imperfect) information. These concepts can’t be conveyed in a television sound bite or editorial cartoon. In contrast, government “solutions” are simple. Total health insurance is too expensive? Pass a bill decreeing it to be universal and affordable. Next problem.

A politician who makes a career of proposing such “solutions” is likely to win admiration not only from the public but also from the news media, whose reporters and commentators know as little economics as their readers and viewers. The dynamic leader who gives impassioned speeches and sponsors legislation on behalf of social justice appears heroic in part because few people can find the logical flaws in the program. Observers see only his presumed motives. But motives divorced from understanding are worthless — even dangerous. In a more sensible world, proposing ends while being oblivious to means would be a sign of irresponsibility, the intellectual equivalent of drunk driving. Maturity lies in understanding that, as Steven Horwitz reminds us, ought implies can. That’s where economic logic enters the picture.

During the endless hours of television coverage of Kennedy’s death, someone mentioned that when he was stricken with brain cancer, he received the quality of medical care that “he wanted for everyone.” But such things don’t come from wishing, proposing, or decreeing.
And he concludes:
Nevertheless, for most people government, despite its occasional scandal and atrocity [see Chappaquiddick], is generally trusted (despite what they say), while business, despite its routine creation of benefits, is generally distrusted. (I acknowledge that the unholy alliance of business and state — corporatism — justifies a good deal of mistrust, but it doesn’t account for all of it.)

Let us hope for the day when the passing of a politician gets little more than an inch or two in the obituary section of the newspapers.
The magic provided through a willfully inflatable currency helps cover the "affordable" aspect of government proposals. The welfare state could not exist without legal tender printing press money, the inflation of which is most detrimental to society's poorest.

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