Saturday, March 14, 2009

Free Market Ideas and Stossel's 20/20

How refreshing! Last night's 20/20 featured the voices of free market economists presenting sound economic arguments against the bailout. George Mason's own Peter Leeson was featured among the anti-pork package economists such as Walter Williams, Don Boudreaux, Mario Rizzo, Ben Powell, Brian Caplan, and Lydia Ortega -- all of whom challenged Obama's rhetoric of agreement among economists on the need for government intervention.

Now is the most important time to express dissent over the prevailing path of government intervention. Ideas matter. Politicians may simply be myopic slaves to the concentrated interests. In that view, their support of these billion dollar bailouts are understandable, if still inexcusable. But the Keynesian demand management ideas that many economists support (and those who fail to speak up are getting pegged to) are wrong, dangerous, and down right bad economics.

In light of this year's annual Public Choice Society Meetings, I find this a particularly important topic. The last plenary session of the conference was entitled "Financial Crisis Bailout: Stimulus or Porkulous?" From where I was sitting, I would suggest that the majority of attendees came down on the "Porkulous" side of the debate. Mike Munger eloquently outlined the foul effects that arise when government removes all risk from the market. He reminded the audience that a fall in real asset values does not equal "market failure". The market process requires failure.

But sadly, a reminder was necessary. And despite a relatively free market crowd, I was surprised to hear justifications of the congressional spending package as stimulus by way of a political Coase Theorm arguments. In other words, the spending package taxpayers will be paying for years to come may simply be 'just another cost of doing business'. These types of arguments suggest (IMHO) that a renewed intellectual investment in radical laissez-faire capitalist ideas is desperately warranted.

Stossel's show serves an important role illustrating for the public of the tyrannical power of a state. The case of Charles Lynch is a tragic case in point (which I hope to blog more about in future posts). Because I do think ideas matter, it excites me to see free market arguments get a slice of national coverage -- even if its only a few minutes among a relentless tide of poor economic logic and political polemics. Given the group chosen for 20/20, some of this renewed intellectual investment in the ideas of a free and prosperous society may be found at the upcoming Association for Private Enterprise Education conference.

1 comment:

Admiral said...

AWESOME. Thanks, I missed this while in Hong Kong.