The Western governments of this world:
- have been interfering with their economies for decades
- have proven to be useless in stimulating or steering new ventures
- do interfere by setting the wrong interest rates via their Central Banks
- do interfere in free trade via import & export duties
- were asleep at the wheel while bankers were plundering
- do take away from us in order to give it back to us again
- do have only a political incentive to do the right thing, not an economical
In any economy, the scarcest, most critical resources must be the most protected. The problem comes when we as a society disagree about what that scarcest resource really is and what role the government must play in protecting it.
Many people instinctively believe that the economy is way too important to leave to individuals. They believe that the government should play an active role in planning and controlling the economy, as well as protecting workers and consumers.
I believe that the scarce resource is individual entrepreneurial talent and that too many rules, regulations, required permissions and licenses, restrictions on ability to hire or fire workers and other government interference suffocates the scarce resource.
A dynamic economy requires faith in individuals. Rather than trying to protect existing businesses and jobs, government should simply prepare the playing field, protect individual property rights and then stay out of the way.
But it is hard for government to have that kind of faith in individual entrepreneurs. Governments seem to feel the need to be activist -- picking and nurturing the industries they think will or should win, preventing job losses from existing businesses to emerging technologies and competitors. Governments especially feel this way if the competitors are foreign.
Even the desire to protect consumers can smother great ideas.......
I believe the role of government should be to protect those of us who are out there in the cold entrepreneurial wilderness with just one match and a little bit of dry kindling. The courage to be out there and the willingness to take the chance are truly the scarce resources that a dynamic economy requires. Suffocating what may appear to be ideas and technologies that pose a threat to current industries or jobs will only lead to economic stagnation.
It's not up to an activist government to fix the problems or pick the winning technologies on its own. Rather, the government should step back, keep the playing field level and allow courageous individuals to strike their entrepreneurial matches.Credit to: Deseret News (Salt Lake City) , Dec 9, 2007 by Hal Heaton
Labour's industrial revolution
Market forces must make way for interventionism, says Mandelson
Monday, 20 April 2009
New Labour will today abandon 12 years of support for market forces by unveiling an interventionist strategy under which the Government will subsidise the growth industries of the future.
In an interview with The Independent, Lord Mandelson said the drive could create hundreds of thousands of jobs in hi-tech and low-carbon industries over the next 10 years, to compensate for the smaller financial services sector that will emerge from the current recession.
The new strategy marks a reversal of the Government's free-market approach since Labour won power in 1997, as ministers follow the bailout of Britain's ailing banks by intervening in other key areas of industry.
The Business Secretary said: "If markets fail or don't work efficiently, government has a role to play – as we saw in the financial markets." He insisted: "The Government's job is not to substitute for markets or displace the private sector. We are not into bailing out the past, but removing the barriers to investing in the future."
His "strategic plan" will be a central part of a "going for growth" Budget to be announced by Alistair Darling on Wednesday.