Every
policy being spoken up by New Zealand’s Left-centric parties make it necessary
to repeat the point of this post over and over.
Leaving
aside the fact that economics can never be separated from philosophy and
politics - that planned economies can only be imposed on planned lives – the evidence of history, and of today, continues to show that
centrally planned economies do not work, cannot work, and with a dreadful price
exacted: human hardship.
Statists
from both the Left and Right, though in every case regarding the Left, too
often view the ‘free market’ as some type of cold, impersonal machine that
rides cruelly over individuals, thus must be regulated by the caring hand of government.
This could not be further from the truth. The market is, indeed, that most
intensely personal thing: it’s you and me. It is as simple, but complex, as the
expression of all the needs and desires of every individual in a market community
searching for resolution, and the means by which those needs and desires are
first matched, then priced and allocated as to the resources available. This
wondrous social meeting place, based on the voluntary transaction, not the cold
dictates of the machine of state, has increased the standard of living of all
those communities that have embraced free markets, as well as bringing those
communities the concomitant freedom that free markets exist on: there is no
free market without freedom, and no freedom without a free market. It therefore
follows, put the oafish fist of the central planner into that complex, living
market place, that is, into the lives,
hopes, and desires of individuals, at this crucial micro level, and despite
it can take one hell of a shellacking, ultimately a market, and with it liberty,
plus the community, will be destroyed.
Economist
Donald Boudreaux explains the reason for failure behind central planning
well:
… I deny that behavioral economics strengthens the case for government regulation. Indeed, I believe that it weakens that case. Because the regulators have the same psychological foibles as the regulatees – yet face far less direct feedback on their decisions than do those whom they regulate – turning more decision-making power over to government increases the frequency of human error and amplifies its ill-effects. Markets keep those errors less numerous and their effects more confined.
Human beings are not laboratory rats to be controlled and conditioned by some elite of their number who, somehow and without explanation, manage to become higher-order creatures simply by working for government and professing deep concern for the welfare of their lab animals.
(Note
again from this quotation the impossibility of separating economics from
philosophy.)
Regarding the topical issue of privatisation versus nationalisation and central planning of the power industry in New Zealand, how much more evidence of this do the Cunliffe’s, Shearer’s,
Norman’s et al need?
A
quick real-world refresher for them:
For
an historical example, click through to this link to see the centrally planned
poverty and food queues behind that first Iron Curtain before it went down:
Poverty, prostitutes, and the long, slow death of the Soviet Union: haunting pictures show desperate struggle to survive in last days of the USSR.
And
if still not convinced, to the present day, look at centrally planned Venezuela,
where their politicians can’t even organise enough toilet paper:
Venezuelans are used to going without staples like milk, coffee and butter, thanks to the country’s frequent food shortages. But now they’re dealing with a much more urgent crisis: a lack of toilet paper.Stores have run out, and each new delivery sees a rush on supermarkets. The demand is so great the government has now been forced to order 50 million rolls to appease desperate shoppers. One woman standing in line at a Caracas supermarket that received a fresh delivery told the Associated Press that she had been scouring the capital city’s shops for two weeks. “Even at my age, I’ve never seen this,” another, 70-year-old shopper told Sky News.Economists blame Venezuela’s shortages partly on price controls, initiated by the late President Hugo Chavez, to make goods affordable to the poorest people in society (in a government store, a kilogram of pasta costs $0.30, writes the BBC). But that has also led to country-wide shortages of staple items, and Venezuela’s “scarcity index” is currently at 21% – meaning that out of 100 basic products, 21 aren’t available in stores, notes the BBC. “State-controlled prices—prices that are set below market-clearing price—always result in shortages,” said Steve Hanke, professor of economics at Johns Hopkins University, told the Associated Press. “The shortage problem will only get worse, as it did over the years in the Soviet Union.”
Say what you like, but as much as our Left politicians hate free markets - and thus an individual's freedom from the arrogant theocracy of themselves - in the market economy, with the feedback loop of market signals, you’ll always have toilet paper. The Left need to take off their ideological blinkers that keep them in this ignorance of emoting about issues rather than thinking on them.
For Labour and the
Greens, who have promised if winning the 2014 election to force us all ever
quicker into that sewage pit called socialism, starting with renationalising
power, and placing it under central planning, please learn the lesson. And if
you’re wondering on the link to toilet paper, specifically, well for purposes of hygiene the
Hubbard household has wholly converted to electronic bidets – think of
warm toilet seats at 4.00am on a wintry morning – and so sadly to employ a
dreadful, because its grossness offends me, but necessary metaphor, centrally
planned power can only eventually mean brown-outs.
Coming to this blog on Tuesday: State
Housing – You’ve Just Got to Be Kidding … in which I introduce to the debate on
state housing, the notion of the cork.
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