Bad policies (industrial policy, protectionism, rent control, minimum wage laws, etc) have a common feature, which is that politicians are trying to replace the “spontaneous order” of markets with intervention and planning.
In this new video, John Stossel explains why government that governs least governs best.
Price controls are a very obvious example of harmful intervention.
As explained in my three-part series (here, here, and here), market-determined prices give us the best quality at the best prices.
Just as John explains in the video when talking about bananas.
When politicians interfere by mandating prices too low or too high, however, we get shortages or surpluses (America’s idiotic farm programs being a painful example).
I’ll close with a few comments relating to John’s discussion of how Central Park was a mess before it was quasi-privatized.
Yes, the profit motive is key to a well-functioning private sector, but even private non-profit groups do a much better job than government.
After all, private non-profits generally are created to solve or reduce a problem (such as poverty), whereas government programs are created to maximize votes.
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Image credit: Andy Withers | CC BY-NC-ND 2.0.
