"This word "over-regulation" and these arguments about government intervention are all bogus. It is because the government backed off what many called "over-regulation" that we are in the very mess we are in!"
This may be what some website with an agenda told you, but unfortunately reality is a little more complicated than that. This crisis has a number of causes and the economists who have been studying it from the beginning still don't fully understand it. True, the repeal of certain regulations was an important factor. But another important cause was excessive encouragement by the government for homeownership. This sort of "over-regulation" was certainly disastrous.
The point this article is trying to make is that the notion of "spontaneous order" is fundamental to both the theory of evolution and the free market. One would be hard pressed to design from scratch a working flamingo, and one would similarly be hard pressed to design from scratch a working economy. Both are extremely complicated systems and one cannot make a change to a single part without watching the consequences ripple out to affect seemingly distant parts of the system.
In the case of biology we can perform experiments so that we can isolate the specific effects of a particular action. This is what makes medicine work. A pharmaceutical company does not make the right drug on its first go--it tries thousands of chemicals before getting anything that works. Unfortunately, we cannot do this in the economy--it won't fit in a test tube. If Congress changes a certain regulation, the effects of this change will be felt in distant parts of the economy in ways that no one could have predicted. But because we can never have a "control economy," we will never be able to figure out what those effects were, exactly. In effect, we're hoping that we can come up with the right drug on the first go. This is nothing more than the Law of Unintended Consequences. Perhaps there exist certain regulations that would make the economy run more efficiently--but until we can apply the scientific method to the economy, we will never be able to definitively determine what they are.
"The point this article is trying to make is that the notion of "spontaneous order" is fundamental to both the theory of evolution and the free market. One would be hard pressed to design from scratch a working flamingo, and one would similarly be hard pressed to design from scratch a working economy."
But what good is a flamingo? If you're trying to solve human problems, spontaneous order from some sort of survival-of-the-fittest system is not good enough. Things that are useful to humans require conscious design. Spontaneous order gave us wood, but it took a human engineer to design the wheel. Evolution by natural selection never could have designed such a tool spontaneously.
Sure, the economy is a lot more complicated than that, and the precautionary principle is sound advice. All the same, there's every reason to believe that humans are capable of designing something better, as long we're not reckless about it.
Comments
"This word "over-regulation" and these arguments about government intervention are all bogus. It is because the government backed off what many called "over-regulation" that we are in the very mess we are in!"
This may be what some website with an agenda told you, but unfortunately reality is a little more complicated than that. This crisis has a number of causes and the economists who have been studying it from the beginning still don't fully understand it. True, the repeal of certain regulations was an important factor. But another important cause was excessive encouragement by the government for homeownership. This sort of "over-regulation" was certainly disastrous.
The point this article is trying to make is that the notion of "spontaneous order" is fundamental to both the theory of evolution and the free market. One would be hard pressed to design from scratch a working flamingo, and one would similarly be hard pressed to design from scratch a working economy. Both are extremely complicated systems and one cannot make a change to a single part without watching the consequences ripple out to affect seemingly distant parts of the system.
In the case of biology we can perform experiments so that we can isolate the specific effects of a particular action. This is what makes medicine work. A pharmaceutical company does not make the right drug on its first go--it tries thousands of chemicals before getting anything that works. Unfortunately, we cannot do this in the economy--it won't fit in a test tube. If Congress changes a certain regulation, the effects of this change will be felt in distant parts of the economy in ways that no one could have predicted. But because we can never have a "control economy," we will never be able to figure out what those effects were, exactly. In effect, we're hoping that we can come up with the right drug on the first go. This is nothing more than the Law of Unintended Consequences. Perhaps there exist certain regulations that would make the economy run more efficiently--but until we can apply the scientific method to the economy, we will never be able to definitively determine what they are.
"The point this article is trying to make is that the notion of "spontaneous order" is fundamental to both the theory of evolution and the free market. One would be hard pressed to design from scratch a working flamingo, and one would similarly be hard pressed to design from scratch a working economy."
But what good is a flamingo? If you're trying to solve human problems, spontaneous order from some sort of survival-of-the-fittest system is not good enough. Things that are useful to humans require conscious design. Spontaneous order gave us wood, but it took a human engineer to design the wheel. Evolution by natural selection never could have designed such a tool spontaneously.
Sure, the economy is a lot more complicated than that, and the precautionary principle is sound advice. All the same, there's every reason to believe that humans are capable of designing something better, as long we're not reckless about it.