Quote:
Originally Posted by ViktorKaBloooom
I am almost sure we come from different countries and different paradigms, so what I mean by government influencing economy is not necessarily what you think. Think a government deciding industries it wants to incentivize, via subsidies for example, and other industries it doesn´t want to do very well. State capitalism. And then obviously you may increase this intervention more and more til you have a Soviet Union type communist economy with five year plans. I agree with your covid argument btw, and it's a great reminder of how hard it is to draw clear lines.
You are still missing the point.
It is still in the government and the people's interest to incentivize certain industries. One reason might be because of national security. Computer chips are of utmost importance to any economy in the world, but if all of those computer chips are made in China then then everyone's economy and national security is at the mercy of China.
A second reason is a concept called Tragedy of the Commons. It is a situation where if everyone acts in their own self interest, it leads to disaster for everyone. If one person in a city of thousands poured their used motor oil down the sewer, it wouldn't matter. But if everyone does it (especially places like oil change shops) then it overwhelmes the water processing plants and everyone's water gets contaminated.
Government is obviously needed in situations like that. People are not going to regulate themselves because they will act in their own best interest and use the cheapest method of disposal (pouring into the city sewer).
The third reason is most individuals do not have the capacity or resources to defend themselves in most situations. Look at the Emerald Ash borer. It is a species that is not native to North America. It comes from China and it just devastates Ash trees.
They came to North America in wooden pallets made of Chinese Ash. People would import a pallet of Chinese made crap, the pallet would make it to America, the crap would be opened from its packaging and the pallet would be discarded. The Beatles would thrn migrate from the discarded pallet to nearby Ash trees and devastate them.
No individual would have enough resources to figure this out, let alone prevent it. Only something like the Federal government can do that.
To your point, yes, it is silly and dumb for a central government to tell industry to produce X number of gym shoes or Y number of loaves of bread. That is the Soviet Union model you worry about. No doubt.
However, that is not what is happening here. Most government regulations address one of the three exceptions I mention.
Don't let poor sources of information take advantage of you by misrepresenting what government interference is doing.