Economic, Scientific, Moral and Natural Law.

[WTL]

The Obama thread has brought up guns. And if anyone is watching the news, they will see the financial crisis going on and the measures the gov't is taking to "do something".


I'm am going to use this occasion to talk about something bigger than either the issue of arms or financial markets.


There are such things as economic, natural or scientific law. A simple example of scientific law is that if a man drops an apple from a building in Atlanta, the apple will fall to the ground cause of gravity.

A government decree that the apple should fly will not cause the apple to fly.

There is an economic law that is the first thing they say when you sit down in econ 101. "There is no such thing as a free lunch".

What that means is everything, everything costs money. Everything has consequences. It is almost like Newton's third law "for every action there is an equal and opposite reaction"

What that means is there are some things that exist outside the will of individual men.. Outside the will of government institutions. They are bigger in scope.

The government's bailout of AIG, Bear Stearns, Fannie Mae and Freddie Mac reminds me of all these natural, economic and scientific laws.

While I don't understand everything that these economic wiz kids, these government beaurocrats come up with, I understand that these firms were failing for legitimate reasons. When you try and absorb what harm their failing was fixing to cause, you don't really eliminate that harm, it will just pop up and manifest itself somewhere else.

It like a brush fire being put out with a garden hose. The fire is huge. You have a little hose. You spray one part of the fire, and it pops up even bigger 20 feet over. You can't put it out with a garden hose.

The government is a garden hose compared to the market. The free market is the ultimate form of power and democracy. The government seeks to control all, and tries to bind down the market. It isn't big enough though. What you have is an unnatural, artificial institution (government) trying to create a free lunch by eliminating a natural institution (the market). And its not gonna work. They might be able to move around who gets hurt by this. They might be able to take all the financial burden that should have been directed at the leaders of these firms and letting the entire country share the burden, or just the taxpayers, but it isn't going away.

Its just like the gun issue. There are guns out there in the hands of people. Good citizens and bad. The government sometimes passes laws trying to keep this or that model from being out there, all in the name of "trying to do something", and it never succeeds. The guns are still out there. In fact, you can argue that since only the law abiding citizens follow the laws, the people being hurt by these laws are the good citizens.

This is the core of the problem. The government does not really have that many legitimate roles. It protects borders. It arbitrates disputes. It builds roads. Then when we have a crisis, the dumb ones scream at it to do something. Do what? What can it do?

Sometimes you have to take your medicine.

The candidates, the President, the government, the FED are all trying to delay the inevitable. In doing that, they are making the mess bigger. And its still gonna go boom.

We would be better off if we just let the recession come. Stop putting it off. We are doing nothing constructive right now, except ensure that that bubble gets bigger, and that when it really pops the effects will be deeper. Its like a big pimple on the face of Washington. Go ahead and pop it now.