Thursday, July 23, 2009

Why I'm Not A Socialist

From Instapundit:

JOHN STOSSEL: The Arrogance of Health Care Reform: Why do politicians with no business experience think they can run 15 percent of the economy? “Most people are oblivious to F.A. Hayek’s insight that the critical information needed to run an economy—or even 15 percent of one—doesn’t exist in any one place where it is accessible to central planners. Instead, it is scattered piecemeal among millions of people. All those people put together are far wiser and better informed than Congress could ever be. Only markets—private property, free exchange, and the price system—can put this knowledge at the disposal of entrepreneurs and consumers, ensuring the system will serve the people and not just the political class.”

Exactly. I'm reminded of the story of the old Soviet minister who, when visiting England, marveled at what the market could provide. He asked his host, "But who is responsible for making sure London has bread?" Of course the answer is "no one in particular", but London still had bread. Compliments of the market.


mazenko said...

For the same reason they think they can - and they can - fund and run the military and a space program that has gone beyond anyone's estimates of what it could do. Because they can fund and run the Center for Disease Control and the NIH which the entire world look to any time there is a crisis. Because they can envision and fund and run an interstate highway system on a massive scale. Because they can fund and run the FBI, the NSA, the NRO, Americorps, the Peace Corps, the best police and fire protection in the world, a EMT program unlike anything in the world, and the National Guard. Because they can envision, fund, and run a program to insure clean water, unmatched anywhere in the world. Because they can envision, fund, and run monumental achievements like Hoover Dam and the Panama Canal.

Stossel makes some really good points sometimes - but mostly he's just an idiot.

Brandon said...

They also run the DMV. We all know how great of an establishment that is. They also run social security and medicare/medicaid. However, we are funding those, but they probably won't be running for much longer, unless you accept government IOU's as payment.

maxutils said...

Mazenko, I mean no disrespect, but have you ever taken a course in economics? I ask, for two reasons: one, Darren, who I enjoy dearly, is always quick to play the 'no government ever' card, and he's demonstrably wrong, economically speaking. Likewise, however, you are quick to play the 'government good' card. The weird part is,y'all have some overlap -- NASA, for example.
If you've studied economics, you know that even Adam Smith realized that there were four areas where government needed to step in, or the market would not be able to correct itself: every single one of the successful programs you mentioned fell in to one of those categories: 1) markets where people who don't pay, benefit anyway (disease control, highways, NASA)2)People who create the harm don't pay for it (pollution control) and 3) imperfect information (not really possible, but insider trading laws at least minimize it), and 4) imperfect competition, regulated by anti trust law.

The black an white argument here frustrates me. Everything you listed falls into one of those categories, but health care doesn't. A non profit organization is ALWAYS less efficient than a profit taker, so government should only take over when it must. Darren's assumption that government couldn't do it is just as flawed as your assumption that it could. Before one posits a solution, it should have some specific economic background.

mazenko said...

I offer the Center for Disease Control and NASA, and you respond with the DMV. That's an impressive comparison.

Incidentally, I've never had a problem at the DMV in forty years - maybe it's where you live. I've waited as long at my insurance office and pharmacy and for the cable guy - all private sector. If you knew anyone who worked at the DMV, you might also consider how much they have to do, and how little staffing they actually.

Social Security has effectively done exactly what it was designed to do for seventy years - keep seniors out of abject poverty. If you discussed the 1930s with working class people who lived it, you might have a different opinion. The problem has been with our rising standard of living and the cost-of-living increases, pursued by voters and the AARP, even though social security was never meant to be the sole source of a middled class retirement income. That said, it's been amazingly successful, and could be fixed quite easily with means testing.

Medicare and Medicaid are equally successful. Medicare members are happier with their care than the average private consumer. Many can't wait until they apply. It controls costs far more effectively than private HMOs, and though it's government funded, my dad wasn't on a waiting list for a hip replacement like Canada or Britain ... and he didn't pay a dime. Means testing again can solve much of the conflict.

Enjoy a nice clean glass of water before you drive to work on your government funded road in relative peace all thanks to your government.

Darren said...


You grossly mischaracterize my position.

For any *new* government program, my default position is "no". You must convince me that it is a legitimate exercise of government, and then that it is necessary, and then that it can be paid for.

As far as current programs go, I would cut many. As a libertarian economist, so would you.

I don't take kindly to the *unfair* swipe.

mazenko said...


As we've discussed in past posts, I do have a background in econ - not a lot, but a minor social studies with a heavy emphasis in economics. It's somewhat of a hobby actually. And, I read and endorse Greg Mankiw as much as I do Paul Krugman. I agree with you that the either/or argument is frustrating, but I am more bothered by the "govt can't do anything" than the "govt is the answer to everything."

I tend to be, in the words of Matt Miller, a radical centrist, and I am as libertarian as Darren is. Additionally, while I enjoy Smith, and have read a fair amount his work, he is no more infallible than Mankiw or Krugman or Keynes or Freidman or Vollecker or Orzag. Like the Founding Fathers, there is much about our current society and economy that he could never have fathomed. Health care being one of them. I don't think you have your finger exactly on the pulse of the situation.

maxutils said...

Darren, and Mazenko, my apologies. The tone of my comment was not what I was going for.

Darren, you are incredibly consistent on the no new government programs side of things, and I CERTAINLY did not mean to imply that you favored government sponsored health care, which I don't either -- the 'swipe' I took, and it was a gentle one, is that in my experience, you have remained unconvinced about government's necessity even though I have offered to prove their need mathematically. If you would like to prove me wrong on this, I will happily break out the graphs. That said, I would rather have you running the world than a lot of people.

Mazenko, when I wrote "no offense," I literally meant it: because if you HAD taken economics, you were exactly rigth, and if you hadn't, you were exceptionally intuitive. And, you're absolutely right about Smith being fallible, although I would argue that Keynes is substantially MORE fallible, and Friedman LESS. I was actually trying not to be condescending, and wound up being more so thatn if I hadn't tried.

That said, I'm a Libertarian, but what I like to call a "not-whacked out" one. You really can't call yourself a libertarian and support government health care though. The system is messed up, and Medicare recipients might be okay with their service, but that doesn't mean that it's either cost effective or optimal. When they are receiving limited services at a perceived low cost, of course they will say they are happy. I'm in favor of governmental policies that would support universal health care, but I absolutely don't want them running the thing, or even collecting money for it.

My apologies for the slights. My rudeness was unintentional, this time.

muckdog said...

Socialism has trouble working because it disregards human behavior. It sounds great to have a central planning think tank that makes the best decisions for all. But people are individuals and generally like to make their own decisions.

allen (in Michigan) said...

It depends on your definition of "working".

If you believe that you're superior intellect makes you a proper leader of the lesser social orders then socialism's your cup of tea. After all, beneath the brassy patina of egalitarianism you find that all the forest of very necessary rules and regulations without which socialism would be unrecognizable, you discover that all those rules and regulations apply unquestionably to "ordinary" citizens and not at all to "special" people.

That's one my chief beefs with socialized medicine - that political forces will inevitably result in two distinct, if unacknowledged, classes of medical care but the discrimination shows up in all areas of society touched by socialism including my particular obsession, public education.