Thursday, March 17, 2011

Reality: Something Government Routinely Gets Wrong

SEE HERE Perhaps the saddest ignorance that the American public suffers from is economic ignorance. It isn't my idea to try to correct that here, except to note that it exists. I don't have time to try to correct all the stupid things that I hear from folks all the time about economics and how government needs to shield us from greedy corporations or whatnot.

The reality is that if we foster diversity in the economic sphere the competition among those seeking to serve us will be far more effective than government. But government benefits from the idea that they are benefactors and so encourage the idea. The reality is that everything that government touches, regulates or controls costs more. Some regulation in the form of standards is important and helpful, but most simply functions like gum in the gears of production and makes things more expensive and scarcer.

In some cases government manages through punitive taxes to destroy whole industries. Most of what was once flourishing small aircraft manufacturers and luxury boat manufacturers in the United States were destroyed by luxury taxes. It killed the businesses, created unemployment and the rich simply went offshore for their boats and aircraft. The less rich learned to do without. This is the kind of thing that is always going on when the government helps us.

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