What killed the USSR? Lots of things, but the leading cause of death was its insistence on maintaining a ‘planned economy’. Its leaders never understood, or just refused to believe, that millions of bright, creative, and motivated people, working individually and in spontaneous voluntary associations, would be able to come up with better solutions than a small group of government officials, even if those officials were among ‘the best and brightest’ people in the country.
That’s what will kill the US, too, if we let it. Unfortunately, it’s what an increasing number of people are calling for.
The question that seems to be on everyone’s mind is: ‘How can we re-open the economy?’ The assumption is that there has to be a plan, that the governors of states, and the president of the United States, guided by the best and brightest people in the country, have to impose a centrally-coordinated vision of how things should work — which businesses should be allowed to operate, on what schedules, following what regulations, and carrying out which procedures.
If this has been on your mind, I invite you to stop and think for a moment about what is most screwed up in ‘normal’ America. That would be the health care ‘system’, and the education ‘system’, right? Which is to say, exactly those areas where government imposes a centrally-coordinated vision of how things should work.
What people are asking for is to extend this kind of top-down control to the rest of our economy, and more generally, to the rest of our society. How is that likely to work out?
I think one can make an instructive comparison between the government’s handling of COVID-19 now, and government’s handling of the Great Depression in the 1930s. In each case, something catastrophic was starting to happen; and in each case, the government, by interfering with the normal course of things, made things much worse, for more people, and for much longer, than they would have been otherwise.
The difference is that we’re only weeks into this catastrophe, so it might still be possible to turn things around by relegating government to a purely advisory role, and letting millions of bright, creative, and highly motivated people come up with solutions that would never even occur to government experts. That’s what we should have done in 1930. Whether we’ll do it in 2020 depends on how much we’ve learned — or failed to learn — in the intervening 90 years.
