A society in which only members of a hereditary aristocracy, a military junta, or a ruling political party can make major decisions is a society that has thrown away much of the knowledge, insights, and talents of most of its people.
No economic system can depend on the continuing wisdom of its current leaders. A price-coordinated economy with competition in the marketplace doesn't have to, because those leaders can be forced to change course – or be replaced – whether because of red ink, irate stockholders, outside investors ready to take over, or because of bankruptcy. Given such economic pressures, it is hardly surprising that economies under the thumbs of kings or commissars have seldom matched the track record of capitalist economies.
This is a lesson the Obama Administration and the Democrats in Congress must take to heed. Otherwise, should they decide they have the means and the knowledge to “control' the economy, they will instead cripple it, maybe to a point where it won't recover for decades.
Do you think it won't happen? Then how do you explain efforts by Congress and the President to control the pay of executives in the financial industry? Do you think they'll really stop there? I don't.
I figure at some point they'll try to set salaries and compensations across the board. That ought to put a crimp in recruiting efforts to find and retain qualified personnel.
As the old saying goes, to err is human, to really screw up takes the government.
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