Monday, November 10, 2008

The Fatal Conceit of Bailouts

The bailouts and partial nationalizations are premised on what Friedrich A. Hayek, Nobel laureate in economics, called the "fatal conceit." Once again, it is assumed that government bureaucrats can plan the direction of the economy better than millions of consumers and investors can. Bailout proponents also rest on a misread of recent history in viewing the current mess as the result of "unfettered" markets. In truth, numerous government interventions from housing subsidies to directed lending have been big factors in this crisis.

~ Fred Smith and John Berlau, Competitive Enterprise Institute


At 11/10/2008 11:15 AM, Anonymous Anonymous said...

From here in Rome, Italy, a review of the english speaking papers (the Herald Tribute, Financial Times, and Wall Street Journal) from today alone, illustrates the basic ignorance that the media and politicians have of this problem.

The government created the problem. The ideology of intellectuals reinforced it. Greenspan was simply another participant in a long series of interventionist games. But the policies that have been used to manage citizens by manipulation of incentives using money, debt, taxes and laws, created the problem. And it is far worse a problem than is understood by those most fervently writing about it.

Curt Doolittle


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