Thursday, February 26, 2009

Clarity from Kyle Bennett

Kyle Bennett wrote this, and I hope he doesn't mind my re-post here, but it's succinct and it is exactly correct.

Blaming the current financial crisis on the failure of markets is like blaming an airplane crash on the failure of gravity.

The markets didn't fail, you demanded they do something impossible. This crash is the predictable and correct result of the inputs you provided. If you let an airplane turn into an ice-covered flying brick, gravity continues to do exactly what it will do - your flight plan might as well be a parabola - and people die. The NTSB never, in its investigations, asks "What went wrong with gravity?" What makes you think markets are any different? [emphasis mine-Ron]

You might think that we can find an alternative to markets, that markets are a political tool that can be chosen or rejected. They're not. They operate at all times and in all places, and always by the same laws. They are the given that your political positions are tested against.

You have failed.
Asking/telling the government to do anything to fix the problem is just more of the same error.

2 comments:

Mike said...

Welcome back!

That is a very good analogy. I still get some pretty smart "progressives" who don't understand that just because they don't like a particular kind of interference in the market or a certain kind of regulation that favours business, doesn't mean that those actions were not interference or regulations.

Any interference or regulations, no matter whom it favours, will distort the functioning of a free market in ways that are unpredictable. Such is the way with bottom up, emergent systems.

In short, any interference or regulation beyond the self-regulation of the market, is bad and will cause problems.

Most people, left or right, want to cure interference with more interference.

It makes no sense to me.

Wildwoods Retreat said...

Please keep blogging ~ I loved this last one!