If no one among us is capable of governing himself, then who among us has the capacity to govern someone else?" -- President Reagan, Jan. 20, 1981.
Economist Friedrich Hayek explained in 1945 why centrally controlled "command economies" were doomed to waste, inefficiency, and collapse: Insufficient knowledge. He won a Nobel Prize. But it turns out he was righter than he knew.
In his "The Use of Knowledge In Society," Hayek explained that information about supply and demand, scarcity and abundance, wants and needs exists in no single place in any economy. The economy is simply too large and complicated for such information to be gathered together.
Thus, no matter how deceptively simple and appealing command economy programs are, they are sure to trip up their operators, because the operators can't possibly be smart enough to make them work.
Later on in the essay:
This became apparent when various large businesses responded to the enactment of Obamacare by taking accounting steps to reflect tax changes brought about by the new health care legislation. The additional costs created by Obamacare, conveniently enough, weren't going to strike until later, after the November elections.
But both Generally Accepted Accounting Principles and Securities and Exchange Commission regulations require companies to account for these changes as soon as they learn about them. As the Atlantic's Megan McArdle wrote:
"What AT&T, Caterpillar, et al did was appropriate. It's earnings season, and they offered guidance about , um, their earnings."So once Obamacare passed, massive corporate write-downs were inevitable
And there's more:
Obamacare was supposed to provide unicorns and rainbows: How can it possibly be hurting companies and killing jobs? Surely there's some sort of Republican conspiracy going on here!
More like a confederacy of dunces. Waxman and his colleagues in Congress can't possibly understand the health care market well enough to fix it. But what's more striking is that Waxman's outraged reaction revealed that they don't even understand their own area of responsibility - regulation -- well enough to predict the effect of changes in legislation.
Possibly this is simply because Waxman and his colleagues are dumb, and God knows there's plenty of evidence that Congress isn't a repository of rocket scientists. But it's just as likely that adding 30 or 40 IQ points to the average congressman wouldn't make much difference.
The United States Code -- containing federal statutory law -- is more than 50,000 pages long and comprises 40 volumes. The Code of Federal Regulations, which indexes administrative rules, is 161,117 pages long and composes 226volumes.
No one on Earth understands them all, and the potential interaction among all the different rules would choke a supercomputer. This means, of course, that when Congress changes the law, it not only can't be aware of all the real-world complications it's producing, it can't even understand the legal and regulatory implications of what it's doing
The bad news is obvious: We're governed not just by people who do screw up constantly, but by people who can't help but screw up constantly. So long as the government is this large and overweening, no amount of effort at securing smarter people or "better" rules will do any good: Incompetence is built into the system.
If that doesn't encourage skepticism toward big government, it's hard to imagine what will.
I loved everything about this essay except the last sentence. As long as politicians are promising free healthcare, money, salvation, chickens in every pot, etc., there will be those who believe every word of it.
Go here to read the whole thing.
The contradiction pics came from here and here and here and here.