tag:blogger.com,1999:blog-4748314449835758607.post8308362492655665470..comments2023-10-30T08:55:00.064-04:00Comments on Kodiak Pyramid: Free Market UtopiaDK Smithhttp://www.blogger.com/profile/15803726073588442881noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-4748314449835758607.post-5392463308747001732008-11-29T10:31:00.000-05:002008-11-29T10:31:00.000-05:00This is shaping up to be a battle royale in the ve...This is shaping up to be a battle royale in the very best sense of the idea. The whole raisin del tree of the KP is to foster this kind of dialogue. Friedmanite is a thoughtful voice of reason on that end of the spectrum, and Aztec is bringing a unique perspective that is also well thought out and cogent. How nice for someone in the middle to hear both sides presented in a civil forum and just think about the issue.<BR/><BR/>Delightful.Restless Nativehttps://www.blogger.com/profile/02706411308856326216noreply@blogger.comtag:blogger.com,1999:blog-4748314449835758607.post-3175972349224566962008-11-27T12:29:00.000-05:002008-11-27T12:29:00.000-05:00RN: Nudge is an important book and has informed a ...RN: Nudge is an important book and has informed a number of Obama's policy proposals. For example, Obama wants to make 401k contribution the default for employees. That means that employees would have to specifically opt out rather than specifically opt in. The result is greater savings.<BR/><BR/>It's no secret that Sunstein is an Obama adviser and supporter. If you dig into Obama's policy papers, you will see Sunstein's fingerprints all over them.<BR/><BR/>Fried: I should have noted that this is part 1 of a series of posts. Having concluded that unfettered markets are not the solution, the next post will be an argument for why government spending tax dollars is better for the economy than if individuals had spent the same bucks.<BR/><BR/>While people by in large should live with the consequences of their actions, there are things that government can do to encourage people to make better decisions. This circles back to the research being done in behavioral economics and the 401k contribution proposal outlined above. The key is that people still have the ability to make a choice, but they should be encouraged to make the correct choice.<BR/><BR/>I thought KP had finally stopped the Freddie and Fannie bashing, but I guess not. The government is currently their conservator, but gained an equity stake in these publicly traded companies. This is absolutely necessary considering that we are in the middle of a credit crisis. If there is no liquidity in the secondary mortgage markets, no one is going to be able to get a loan. Now that the Feds have agreed to back Citi, you are finally seeing interest rates decline and money being pumped back into the economy.<BR/><BR/>Finally, your last paragraph emphasizes my main point. The government has no monopoly on either education or infrastructure. Anyone can open a private school, charter school, or university. Heck, you can home school your kids. Education is very much a private market. Yet this private market has failed to produce a sufficient number of qualified graduates to meet the current demands in engineering, research, and medicine. <BR/><BR/>The same is true for infrastructure. There is private ownership of railways, pipelines, refineries, electrical transmission lines, ports, ferries, and toll roads. A huge part of our infrastructure consists of common carriers, which are open to all, but privately owned. <BR/><BR/>The nation's entire oil and gas infrastructure is privately owned. And due to consumer demand, energy companies have built massive, but efficient distribution systems with private dollars and lapdog Federal oversight.<BR/><BR/>But the same market forces have failed to sufficiently meet the challenges of energy independence. And where the markets have failed, there is a substantial case for the government to step in and help solve the problem.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4748314449835758607.post-56454948975168336132008-11-26T21:13:00.000-05:002008-11-26T21:13:00.000-05:00Interesting post. I have a couple comments.First,...Interesting post. I have a couple comments.<BR/><BR/>First, you're saying that humans acting in their own self-interest don't always make good decisions. So we should replace some of their decision-making power with central government decision-making power. Yet the central government doesn't have a good record of making sound decisions either. <BR/><BR/>At least with individuals, they have to account for their own decisions, pay the consequences, and normally learn to perform better in the future. I can guarantee you a lot of people will be looking at their house purchases a lot closer the next time around. On the other hand, central government continues to fund and expand Fannie and Freddie.<BR/><BR/>As for your examples of infrastructure and education, those are both controlled by the government, so I don't see how free markets can be blamed for their lack of performance.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4748314449835758607.post-22622535226484536962008-11-26T19:53:00.000-05:002008-11-26T19:53:00.000-05:00Whoa there, Aztec. I am for free trade and genera...Whoa there, Aztec. I am for free trade and generally for free markets but I don't disagree with you at all. Your points are very much in line with the book I suggested be required reading for the SP, Nudge. They talk about Humans v "Econs", Humans frequently making bad choices while mythical beings called "Econs" could actually function well in a Friedmanite (Milton, that is) environment.Restless Nativehttps://www.blogger.com/profile/02706411308856326216noreply@blogger.com