The Tao of the Dow

Congress appears to be on the verge of passing another ground-shaking piece of legislation–financial reform. Thank heaven, I can relax now.  NOT!  It’s not just that these particular 535 people as a whole tend to screw things up consistently.  The problem is the whole idea that an economy needs “fixing.”

“Fixing” things often just screws them up.  The Tao, a universal energy that is believed by Taoists to nudge the Universe along its never-ending path of change, knows what to do.  We need only work with it gently and unobtrusively.  Like frying a small fish, fiddling with things too much results in broken pieces.  A free economy accomplishes what no individual, group of individuals, or supercomputer can ever accomplish.  It delivers what people want cheaply and efficiently, all without central direction.  A planned or highly regulated economy results in near-universal poverty and eventually totalitarianism.

Short of preventing or redressing substantive harm to parties not involved in a particular voluntary exchange, there is no reason to have regulations.  Enforcement of voluntary contracts is all that is necessary.  Through the miracle of the price system and the freedom to provide value to others, the rest takes care of itself.  Yet this is precisely what politicians abhor.  The civic-minded volunteers who two centuries ago devoted part of their time to conducting government’s minimal business have evolved into today’s career politicians, disconnected and often contemptuous of the realities of everyday life.  Their world is one where they know what is best for you, me, and thee.

The change is not becoming to our country.  We sit on the sidelines while governments grows, sticking its fingers into every pie and watching our every move.  We allowed incumbents to plug themselves into a vast network of lobbyists who would rather see their companies receive favors than provide better goods and services.  We watch in silence as regulations choke out small enterprises that cannot possibly comply with every rule and guideline.  All these things have been sold to us on the premise that they “fix” some perceived injustice or inefficiency.  Like the small fish, our country is about to break into pieces from all the fixing.

Along with politicians, some citizens hate the idea of economic freedom because it forces them to grow up.  Yes, some companies will go out of business.  And yes, some people will lose their jobs to new technology or the inevitable turbulence of free markets.  But every policy that seeks to redress one perceived injustice creates a dozen others.  The minimum wage is meant to boost lower-class incomes, but instead causes companies not to hire as many people.  Draconian regulations on toy manufacturers drive small producers out of business, even though they are intended to keep lead out of childrens’ reach.  Moratoriums on nuclear power plants increase our reliance on oil.

Freedom is tough.  It requires we human beings to confront ourselves with some troubling questions.  What do I need to do to survive and prosper?  Am I preparing as best I can for the time when I can no longer work?  Is this the best I can do for myself, my family, and others I care about?  An economy in which no one is forced to provide for us is one that places great demands upon us.  It is right and proper not just because this is the way human beings should live; it is how they must live.  The alternative is a world in which we sink more and more rapidly into mutual beggaring, one in which the government gains more and more power as we snap and growl at each other, always on the lookout for someone who gets more than we do.

“Leave us alone!” should be the rallying cry of every self-respecting American.  Leave us alone to do good for ourselves and others as we see fit.  Stop trying to fix us.  Stop trying to fix the economy.  For heavens sake, you are fixing us to death.

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Terry has missed you folks.  He took a brief respite from blogging to reassess his most fundamental convictions.  Turns out he was right all along.

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About Terry Noel

I am an Associate Professor of Management and Quantitative Methods at Illinois State University. My specialty is entrepreneurship.
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