Sunday, November 25, 2012

The Best Economic Illustration Ever

We do not live in a "free market" society. We live under a crony system of rent-seekers. John Kay succinctly explains:

The fall of the Berlin Wall was the symbol of the most important economic development of our lifetimes, opening the way to the creation of market economies not just in the former communist states but in countries such as India with great unrealised economic potential.

Yet many misunderstood the lesson of the failure of centrally directed economic systems. Market economies succeed when they advance through disciplined pluralism – the process that gives maximum scope for experiment and innovation, while ensuring that when experiments and innovations fail they are terminated, and that when occasionally they succeed they are imitated. That is the origin of the advances in the IT sector.

The success of market economies is not achieved by policies that encourage people to be greedy and imposing as few restrictions as possible on what the greediest of them do. That was the world of Shah Jahan and it produced very little in the way of economic advance.

Read it all here.

Friday, November 9, 2012

Have We Crossed the River, Children?

My partisan Republican friends have turned Facebook into Jonestown.

I haven't seen such weeping and gnashing of teeth, such apocalyptic doomsaying, such moroseness.

What I want to say to them is that America's political and economic difficulties have been at least 40 years in the making -- actually a lot longer; but I like to go back to the Nixon administration for ironic effect. For it was under a Republican presidency that the "gold window" was closed, the Fed given a free hand to inflate, and Politburo-like wage and price controls were tried. The dollar has lost 80% of its value since that time. And America has gone after foreign dragons to slay -- at no small expense.

But only since this past Tuesday we suddenly find flags flown at half-mast or upside down, and lyrics to hymns circulated via email. Even evangelical leaders I respect are bemoaning the green light given to the "pro-death" forces in government -- when all the while the rate of abortions is actually falling, especially among younger women. But if we have in fact crossed the river, that happened some time ago


Regardless, I'm not ready to drop arm-in-arm with others, bidding "goodbye, cruel world."

Jack Hunter has put forth another splendid piece at The American Conservative that points to the only sensible way forward -- a return to constitutional conservatism. Now, this is a conservatism based on the old wisdom of the old republic, in which the individual states decide what will stand within their own spheres -- which doesn't necessarily sit comfortably with culture warriors (if it's gun rights, okay, but marriage and legalized pot, no way).

I would simply add that a diminished role for the federal Leviathan and increased space for civil society can only enhance the influence of the Church on cultural matters. As long, that is, as we don't succumb to a spirit of fear -- like the poor souls in Jonestown.