Market Failure (Or Not)

Re: Markets have crashed (and failed us)

This is less of a "market crash" than a trust-in-government crash. Both for those who believe they have an absolute right to "Obama’s stash" to those of us who want to believe the system is not inherently evil, just poorly managed. Weimar was "just" a market crash and see where it led given Bismarck had conditioned his people to be sheep rather than righteously independent and self-reliant (and consider that these were Germans, historically a very proud and fiercely independent people).

Where the three legged stool for civil society is some combination of Family, Faith and Markets. With history suggesting government and a free press are a distant fourth and fifth. It’s hard to believe how closely the U.S. MSM now resemble the old soviet mouthpieces – Rush and his daily half-dozen sound-bites of news-hacks using the same adjectives, and stories uniformly uncovered and uncommented upon until the politburo is forced to react, etc. In the triad + government, it’s sobering to observe that all are “faiths” related to distribution of a scarce resource. In the Family, the parents decide what’s “fair,” in Faith the minister, king or dictator (or dictatorship of the majority, constrained or not), in the Market, it’s also an act of faith that two individuals acting independently in their own self-interest will most often advance the general good. Unfortunately, the Market faith struggles because the other two beat up on it mercilessly because it is a “faith” as if theirs is not. Where empirics show a free market regulated only by competition (by free citizens and their enterprise) does orders of magnitude better at raising the absolute quality of life for all citizens than the other two. Sadly, egality suffers when success is earned, v. gifted. Which is a small price to pay for accepting the human condition as it is, v. what we wish it would be.

This all leads to a discussion about how we can remove most of the cruft that has accreted in our operating system and return to something understandable (by the average person) that rewards those exercising intellect and judgment, penalizes process, and shortens the time between an action and its good or bad result (hopefully locally, not nationally, in most regards). And then if the citizen and their enterprise are relatively free to move, they (a locale’s citizens) can choose their own definition of success. By whatever metric pleases them. Social, economic, religious, smell, size, appearance, egality, etc. Where perhaps the only constraint is (1) no taking (redistribution) from other locales, and (2) no taking from your children’s children (no manumission, indentured servitude beyond current generation and its children).

Perhaps there is a simple three or four sentence fix to our current rule-set (which we should look for but historically layering more cruft on top of an already crufty OS doesn’t work out well long term unless the steady-state is acceptable – e.g. IBM’s MVS). Something that would return to self-rule and rule-of-self (and given the libertarian ideal is unreachable, at least for smaller communities of no larger than several hundred thousand). And disestablish the current tyrannies not only D.C. but places like Sacramento. (We have to know were in deep trouble when bills are thousands of pages, like OS bug fixes that amount to 10,000s of lines of code).

What we need to avoid is squeezing the balloon, shrinking something on the upper-half just to have the lower-half expand. The modern interconnected society has amplified outrageously the impact of faction and special-interests. The only way I can see to reduce their influence is to divide the target, and not just from 1 (D.C) to 50 (the states) – but hopefully by a factor of 1,000 (so we can have another 200 year run of mostly ignoring government and doing as we please). Then everyone can choose to find a place hospitable to their interests, gain the benefit and pay the (local) price for the privilege. Special interests then have to become local interests again. Some locales will quickly die and go into bankruptcy but then be recovered by some entrepreneurial class/locale (no more long-term decline in areas like downtown Detroit, they and similar places will be put out of their misery in years, not decades..).

N.b. We must do something soon, because we are starting to see an egress of able people to other locales who are tired of spending more than 10% of their emotional and economic energy on government. Not only are the able fleeing high-tax states, they are fleeing the States. I’d like to give them and their families an option to stay here. What was an ignorable trickle is now visible. And the world is no longer as hostile to free enterprise as it was during the cold war. Many are willing to sacrifice their personal political freedoms for a better life for themselves and their families.

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