“The Solyndra Economy”
13th October 2011
Freeberg is always worth reading.
To be fair about it, “pure” capitalism already saddles us with an endless procession of sad situations in which resources are allocated according to who’s-friends-with-who, rather than what would be best for consumers and other stakeholders. But a centrally planned economy does nothing to fix this, if anything it exacerbates the situation. When you have a free economy and the consumer is in charge, there’s always some corrective force applied to it. It doesn’t win out at the end of the day, true; it doesn’t even win most of the time. But at least the corrective force intensifies as the problem gets worse, and it’s easy to forget that what we see of the problem is really just the remnants of it after the unacceptably odious parts of it have been quietly cleaned up.
A command economy lacks this clean-up device, and so, over time, the problem has to get worse. It can’t do anything else.
For the record, he’s wrong about his understanding of pure capitalism. But he’s spot on if he’s thinking of ‘crapitalism’, and respecting the alternatives.