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Worst of all are the political incentives that are unleashed when Washington promises to spend a trillion dollars (and counting). No one can spend such money wisely even if they want to. The information about who needs to be bailed out and who needs to fail is too complicated. Inevitably, such decisions will begin to be more about politics than economics.The banks were first. Then the insurance companies. The car makers are getting a cut. Who’s next? The governors, probably. Homeowners are waiting. Then there will be the hedge funds. Once the line forms, companies will stop trying to save themselves and focus on being saved by Washington. The resulting spiral will be devastating.Unfortunately, there is no consensus about a preferable alternative. The economists are almost as clueless as the politicians. At such a time, inaction may be the wisest course of action.

Yeah, Ding Dong the Witch is Dead. That would be Glenda of course. Have fun on Tuesday night. It doesn’t matter.

6 Responses to “Russ Roberts Channels Hayek”

  1. Bobo says:

    You mean who wins the elction doesn’t matter right? …I agree

  2. Patrick says:

    It does matter, just not for the economy. It matters for forein policy, it matters for social issues, it matters for privacy issues. It also matters as to who’s leadership skills, experience, and judgement are better.

    Politicians don’t want to look stupid so they feel like they have to have ‘a plan.’ Truth is I haven’t found anyone yet who both knows what is going on and has a comprehensive plan that seems like it would work. I don’t know if i is even possible for anyone to have a plan really. Too much uncertainty! Too much uncertainty! Black Swans everywhere! Aaaaargh….

  3. Bobo says:

    That sounds very reasonable to me, I wrote that out of sheer ignorance, I don’t know anything about politics actually, so I should stop trying to sound like I do (although I do have a gut feeling about this election) and that’s why I’m not voting 🙂

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