Friday, April 29, 2011

Facts are to be Ignored

I had to abandon free market principles in order to save the free market system. George W Bush

All of the evidence tells me I am wrong, yet I don't want to believe it.

I believe today, and have believed from my earliest childhood, in the ideals of the free market. Let people, companies, ideas fight it out and the best will survive while the worst will disappear. That government can't pick winners in the marketplace. That people make choices benefiting their own best interest.

Ignore the airline industry. Decades after deregulation, only Southwest Air makes money, yet the other miserable companies continue on. The principle of the best winning out is right of course, it just takes fifty years.

And sure, Enron was a bad idea that failed, but AIG is still around. Oh, yes, that's because W bailed them out in order to save the free market system.

The NFL avoids competition, yet a few hundred million people enjoy watching it anyway. While the competition of the medical industry has provided the US with a product that is mostly hated.

I shouldn't let little things such as the massive capital barriers to entry that limit competition to the establishment bother me - try to find a new company in oil, mining, commodity chemicals, steel, automobiles, farm equipment.....and count the number of price fixing fines those companies have piled up.

Flawed as free markets are, they are far better then the alternative of having Government pick the winners and losers. I believe this despite all of China's evidence to the contrary.
"On Monday, March 14th, 2011, the Chinese government passed the Twelfth Five-Year Plan which seeks to: address rising inequality and create an environment for more sustainable growth by prioritizing more equitable wealth distribution, increased domestic consumption, and improved social infrastructure and social safety nets. The plan is representative of China's efforts to rebalance its economy, shifting emphasis from investment toward consumption and from urban and coastal growth toward rural and inland development." (I copied that from Wiki because it was so well written).

While aspects of free market are alive and well in China, any rational analysis must conclude that the government has been exceptionally good at picking winners.

Still, it must be true that people make decisions in their own self interest. I shouldn't be bothered by the crates of potato chips and candy bars in the shopping carts at Walmart, nor the lack of something that looks like food. I shouldn't consider cocaine, heroine, alcohol and tobacco purchases. People who drive drunk, aggressive and without seat belts also should be ignored.

Yes, despite all the evidence that it could BE different, I'm still a free marketer.

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