The Story of Broke Response
http://www.youtube.com/watch?v=B_FncAQsAJg&list=PLD78A4CA3338CFA7E&index=1&feature=plcp
The story of broke is a recent video by the creators of the story of stuff. In it, Annie Leonard says that Government isn’t really broke. She says we actually have plenty of resources to create the future we really want. But the problem is that Government is wasting those resources on THE wrong things. I agree that Government is wasting resources on war and subsidies. War, for example, diverts resources from production to destruction and taking money from taxpayers and giving it to big businesses through subsidies and other programs is both wasteful and wrong. But, I think she makes an important mistake when she says Government subsidies TO the right companies, we’ll get us A future we all want.
First, how can you argue that there is one vision of future that we all want. It sounds great to say something like everyone should have access to a first rate education. But, who gets to define education? What books count as great literature? How much time should students spend on math? Should biology textbooks have warning levels? Should economics textbooks? You might think the answers are obvious. But, there are, probably, honest and intelligent people would disagree with you. Who gets to decide and how? A one size fits all solution arrived at through political process isn’t a solution at all. It ‘s just a decision made by bureaucrats and by politicians electied by some fraction of the voters. And, there is no reason to think that they will make right trade offs.
Second, the story of broke proposes replacing bad subsidies with good subsidies. But, how do we know who to subsidies? Governments have a terrible track records when it comes to picking winners and losers. Without the prices, profits, and losses that marketS generate, Governments don’t have knowledge necessary for wise choices. People who watched the story of broke are told that jobs will be created by moving to alternative energy sources and bio based materials. But, when Government has tried this in the past, with athinol for example. it hasn’t really worked that well and there have been all kinds of unintended consequences. I agree that we should get rid of sweet heart deals and subsidies for oil companies, and for the rest of what she calls the dinosaur economy. But replacing those with new favored industries is just gonna create new dinosaurs. It’s profits and losses. Not Government handouts that will guide us towards more efficient energy sources.
There is another reason to be aware of subsidies. They attract people who want free stuff from Government. If Special Interest groups and lobbyists are sharks, then the prospect of big juicy subsidies is blood in the water. Even if we agree on the goals the incentives created by political distribution of goodies would draw people into the political game, resulting in transfers of wealth to powerful Special Interests. Once started, subsidies tend to grow. When our laudible goals aren't reached, Lobbyists and the politicians they've convinced to say it is not a failure of the program, but thatwe just need to spend more.
The story of broke assumes that power can and will be used wisely, if it is concentrated in the hands of right people. But power benefits Special Interests and hurts the rest of us. Indeed, we are in our current mess in part because of interventions that were supposed to build better future by making housing and higher education more affordable. The story of broke is right that we can build better future if we stop wasting resources on war, subsidies, and special priviledges for powerful people and powerful firms. But a better future does not come from Government spending. It comes from letting people decide for themselves how to spend their money on things they care about. It coms from billions and billions of people cooperating freely and voluntarily with one another. In other words, it comes from what people do in free markets.
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