Wednesday, December 1, 2010

Oh look, a goblin socialist

This is a common market problem: while the action is good for the whole, the gain is so little that the people don't care, while the few negatively affected do. Here comes the necessity for rules and enforcing agencies, to stop things that are bad for lot of people just a little. If my car is emitting too much CO and NOx, no person in the county are poisoned enough to personally sue me. On the other hand not fixing my car saves me $500, so I won't. But the National Traffic Agency forces me to get my car checked every second year and takes its license plate if it has bad emissions, making me to fix it.

The perfect example is the 2008 depression: whenever a banker repacked a bunch of crap papers and insured them and repacked the insurance too and sold it to several investment funds, he made lot of money, while harming no single individual. He increased the risk of everyone by a tiny little bit. You know how that story ended, right?

Ayn Rand would be crying right now at this blatant support for socialist and government intervention in the market. That is, she would be crying if she was not dead and incapable of human emotion.

Let's get to the facts: if people can't protect themselves from 'the market' or 'externalities', it's because they're too cheap or economically weak to do so. If people get tricked by bad derivatives, it's because they were too stupid to investigate them properly. If they were smart they'd have been the ones selling them.

So there's no market problem here, just a whole lot of people who were too lazy to see what they were buying. Should we really be letting lazy, stupid people dictate the market? Well sure, if by "dictate" you mean "be lazy and stupid so we can take their money", but if you mean have regulations to protect them, no.

But let's just say we do want to think about this "greater good" that the socialists love so much. Even then, since the market efficiently distributes resources while socialism kills millions of its own subjects, we can see that a so-called imperfect market is still for the greater outcome. In other words, any regulation at all, even the slightest bit, is not just the slippery slope to socialist takeover, it is itself socialist takeover.

But what else should I expect from someone raised in the Soviet mentality?

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