Friday, December 17, 2010

...then have a night of efficient German sex.

One of the core Keynesian-style arguments for government control of business is an emphasis on efficiency. If government manages financial industries, the unanimity in decisionmaking--so goes the hypothesis--will benefit the people in the form of reducing inefficiencies created by self-interested individual businessmen and companies. It's the Wal Mart model writ large, essentially: prosperity through strict control of waste. And Wal Mart has definitely proven that the model can work spectacularly, at least in the short term.

I'm primarily concerned about this for philosophical reasons (freedom is more important than efficiency, in my opinion, and preoccupation with efficiency through regulation is inherently at odds with regard for the individual's autonomy), and because I think it's unrealistic to believe that government agencies won't gradually accumulate bureaucratic entropy that will eventually eat all those efficiencies and then some. But there's another concern that I think is often overlooked.

The more efficient a system, the less resilient it is in the face of unexpected complications. Less efficient systems have a margin of safety, while hyperefficient systems jam up with the slightest obstruction:

A split-second power disruption at a Toshiba Corp. factory in Japan could hurt shipments and raise prices for one of the world's most widely used computer chips, a mainstay of devices like smartphones, tablet PCs and digital music players.

Toshiba said the power outage could cause a 20% drop in its shipments over the next two months or so...

A power interruption overlapped with a failure of Toshiba's backup power system for seven one-hundredths of a second at one factory, and the consequences of that will be ongoing until February. For fuck's sake, what would happen to the global economy if a real crisis hit the computer industry? We saw just recently the spectacular cascade that can happen when banks similarly threw away their margins of safety in the name of maximizing efficiency--hell, since then we've had people screaming from the rooftops that governments need to step in and prevent them from doing business that way.

Believers in better living through government often rebuke libertarians with some flavor of "yeah, well if you want the benefits of the modern efficient integrated marketplace, you have to accept extreme government regulation!" I'm good, actually. I could deal with small business prices in the absence of the Wal Mart business model. The loss of the familiar race between businesses to be the leanest, cheapest, safety-netlessest shop on the street is not especially terrifying.

The combination of a population unable to cope with recessions and a competitive marketplace that knows elected governors are politically unable to let megacorporations fail means that, realistically, this kind of brinksmanship just won't stop being the norm until too much falls apart at once to be propped up, so the debate is honestly kind of pointless in practice. But man... Cautionary tales about how deregulation would mean we don't get to live in a Wal Mart world that falls apart at the slightest crisis are not the motivator collectivists seem to think they are. A Darwinian marketplace that slows progress and decreases efficiency by rewarding economically conservative behavior is pretty attractive, actually, when we see that the alternatives are the grinding sloth of socialism or the inherently unstable balancing act of government-administered economies.

I suggest spreading the meme that a libertarian utopia would be infested with sasquatchtopuses. That's freakin' scary.


  1. Elmo - "It's the Wal Mart model writ large, essentially: prosperity through strict control of waste."

    Wow, do they at least have the decency to say, "In theory" as this idea is put forth?
    I just saw the results of a study the other day stating that 75% of the money put into government social programs goes to supporting the machinery of government with only 25% actually making it to the targeted parties. Contrasted to that, private charity flipped those stats with 25% going to administration and 75% making it out.
    Separately, there's the whole government being allowed to use force issue. Maybe an example should include Wal-Mart security guards coming once every two weeks escorting us to Wal-Mart and requiring us to spend about half our paycheck...

  2. Two nails, both on the head. Like I said, man, government accumulates bureaucratic entropy, and legislated efficiency is a goal exactly opposed to letting people manage their lives the way they want to.

  3. Apropos of your title: after they're done with the night of highly efficient German Sex, the participants tell each other "alles in ordung"; or so I've heard.