The problem with Majority Opinion

" The conception that Government should be guided by majority opinion

 makes sense only if that opinion is independent of government."

  F.A. Hayek

Why is it that no matter how hard we try to correct our economy, it seems beyond hope.  Many Americans are filled with a sense of hopelessness,  they have been conditioned and educated to believe that our big benevolent institutions of government know what is wrong, and possess the tools to correct what is wrong. After all, since the 1930's we have been hard fixed on a course of imposing corrective measures on our economy and society through the implementation of scores of remedial laws and corresponding rules and regulation.

It is no coincidence that these seemingly hopeless times correspond with about half of our voting populace being dependent upon their relationship with government for their livelihood.

Whether you are a corn farmer, employee of a major bank, Detroit autoworker, engineer for GE, work for a NGO, retired and on Social Security and Medicare, receiving government assistance, or employed by a national, state, or local unit of government, you are dependent upon government and consequently vote to further your benefit.

This phenomena of majority government dependence exactly coincides with the crisis of governance we are currently experiencing.  To repeat Hayek:

 " The conception that Government should be guided by majority opinion

 makes sense only if that opinion is independent of government."

The seeds for this fundamental change in the makeup of our society were sown in the 1930's, watered and fertilized by zealous protectors of "social justice" over the course of 80 years, and have now sprouted.  It has taken so long for this transition that generational memories have been lost.  When my parents were born very few adult Americans relied on the benevolence of government for their livelihoods, they were independent of government.  

It is often said we are at a great tipping point.  If the American experiment with Individual Liberty in the form of a Democratic Republic is to continue its reign as the Worlds most desirable form of government,  the interest of the majority must be unbound from the government.

Steve

Social Engineering

Name nearly any major issue we face today, whether it be joblessness, state deficits, federal deficits, unfunded liabilities, social unrest, the mortgage crisis, health care costs, or the unsustainability of Medicare or Social Security, and the answers to solve these problems will rest on the principles of Individual Liberty. The solutions may not come about as fast as some people will desire, but they will be forged in the time tested crucible of experience.

We have seen in each of these issues, that the answers provided by principles that rest on a concept of "social justice" will so increase the bureaucracy devoted to defining the problem, devising a solution, and managing the outcome, that the bureaucracy itself will become an impediment to a truly "just" solution. Impediments to genuine solutions will exist because infinite rules and controls will be introduced to correct or prevent the occurrence of events seen as unfavorable to the "defined" solution.

Time after bloody time, we painfully relearn the lesson that no matter how smart the technocrats/politicians/leaders we place in charge are, men are simply incapable of taking into account the myriad unintended consequences of their actions.  Sometimes we come close and prevent major damage.  Most of the time we wreak havoc on the economy and our culture by chipping away at Liberty.

Here is the typical sequence of events as illustrated by the housing debacle:

We decide as a society that it is a good idea if most of the population owns a home, we have seen through innumerable studies that homeowners are far more likely to raise law-abiding children, cost society less, and contribute more to their communities.

Lawmakers then propose and pass legislation reducing the cost of home ownership.

Bureaucrats then determine the implementation of the law via the guarantee of loans, the reduction of equity required,  reduction of banking reserve requirements for those willing to make the new loans, and not least the coercion of private banking enterprises through the granting of privilege to expand their operations.

The huge new amount of debt instruments introduced into the economy find most buyers willing to take only the best and consequently, in order to sell the higher risk mortgages, financiers bundle batches into combined classes of risk.

The sheer volume of these new debt instruments becomes so large that the degree of separation between ultimate lender and borrower becomes infinite and the huge volumes necessitate international trade and whole new classes of financial instruments are created to enable the market to absorb the volume.

When the whole program crashes, Americans are aghast.  How could this happen?  Where were the regulators?

If have followed the underlying logic so far, you can apply similar reasoning and eventual outcomes to virtually every major social program.  To reiterate:  Society defines a goal,  legislators enable the goal,  bureaucrats interpret the legislation and enforce its implementation.  The major problem then occurs when the coercive power of government is used in the absence of that power being specifically granted by the society that defined the original goal.  In other words the politicians hand off the rule making responsibility to the executive branch.


Ultimately your Individual Liberty was reduced because your elected officials and their appointed technicians
obligated you for the failure of their policy implementation.


Who could argue that greater home ownership was not an admirable objective?

Greater home ownership was and is desirable.  The important point is we must let the general increase in wealth generated by policies which encourage free enterprise, individual liberty, and rule of law drive our social aims.

Steve

Steve Jobs R.I.P.

How many Wall Street Protestors are sporting IPHONES?

Everyone who today laments the passing of this billionaire genus entrepreneur, take pause and pray that his passing does not coincidentally mark the end of the society that enabled his contributions to the world. We are fast laying down rules and requirements that stifle innovation of any kind.

I'm not kidding. Ask yourself how many Jobs today are hindered by the the forces of coercion from bringing to the marketplace stunning new ways of thinking, doing and acting. If you answer "probably not many", you are correct.  The point is that the fragile unknowable resource that is human innovation is easily squelched by a well meaning society intent on correcting some perceived injustice.

The crucial point is that is doesn't take a lot of Steve Jobs to immeasurably improve the world.

Another crucial point is that we cannot know who, when, where or in what field of endeavor innovation will spring forth. It is not a plannable, controllable, governable event. It cannot be "stimulated" by government.  Pure brilliant innovation can best be be fostered and stimulated by the protection of.......you guessed it,  INDIVIDUAL LIBERTY.  So stop blaming the rich, stop protesting social injustice, stop bestowing privilege on classes of people and corporations through laws that only protect or privilege some of us. Law must apply equally to all. 

Start protesting the loss of Individual Liberty,  start protesting unequal application of Law, start protesting social engineering,  start protesting laws that enable labor unions to force people to join them in order to be able to work.

If you loved and admired what Steve Jobs brought to the world, you must protect our country's ability to nurture success.