Post by jeffolie on Apr 13, 2008 16:08:11 GMT -6
You Get the Government You Deserve
by Charles Wheelan, Ph.D.
Three things have become clear as the mortgage/real estate debacle has unfolded: 1) Left to their own devices, millions of people (and some pretty sophisticated lenders and investment banks) will do some profoundly stupid things; 2) The effects of those stupid things spill over to affect everyone else; 3) Lots of Americans expect their government to do something about it. (Let's not pretend that it's just Democrats; the White House was pretty darn quick to roll out its bailout plan.)
There's an equally compelling argument, with strong supporting evidence, that individuals make systematic errors of judgment, and that we're bad at assessing risk. Thus we eat poorly and exercise too little. Examples suggest that government can help save individuals from themselves.
Which brings us to the real estate debacle. No one could've predicted exactly when or by how much real estate prices were going to fall. In fact, no one could have said with certainty that they would fall at all. But any rational person should've known that it was a realistic possibility.
Everyone loves small government in theory. We're tired of being told that the coffee we're about to enjoy is hot. But then we burn ourselves and expect someone to show up with ice. You can't have it both ways. This all strikes me as a load of new evidence for the "government for semi-rational adolescents" camp.
finance.yahoo.com/expert/article/economist/67468
---------------------
I view politics under our form of government as messy and a slimmy process. However, it is better than any other form of government actually in practice.
by Charles Wheelan, Ph.D.
Three things have become clear as the mortgage/real estate debacle has unfolded: 1) Left to their own devices, millions of people (and some pretty sophisticated lenders and investment banks) will do some profoundly stupid things; 2) The effects of those stupid things spill over to affect everyone else; 3) Lots of Americans expect their government to do something about it. (Let's not pretend that it's just Democrats; the White House was pretty darn quick to roll out its bailout plan.)
There's an equally compelling argument, with strong supporting evidence, that individuals make systematic errors of judgment, and that we're bad at assessing risk. Thus we eat poorly and exercise too little. Examples suggest that government can help save individuals from themselves.
Which brings us to the real estate debacle. No one could've predicted exactly when or by how much real estate prices were going to fall. In fact, no one could have said with certainty that they would fall at all. But any rational person should've known that it was a realistic possibility.
Everyone loves small government in theory. We're tired of being told that the coffee we're about to enjoy is hot. But then we burn ourselves and expect someone to show up with ice. You can't have it both ways. This all strikes me as a load of new evidence for the "government for semi-rational adolescents" camp.
finance.yahoo.com/expert/article/economist/67468
---------------------
I view politics under our form of government as messy and a slimmy process. However, it is better than any other form of government actually in practice.