Subject:
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Re: What happened?
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Newsgroups:
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lugnet.off-topic.debate
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Date:
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Tue, 27 Jul 1999 11:25:49 GMT
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Viewed:
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1084 times
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> > So you are arguing that if you remove all Government intervention, then
> > there won't be any business cycles? You are also apparently arguing
> > that there has always been Government intervention?
> >
> > You appear to have argued yourself into a corner, where you cannot
> > claim any evidence to support your case.
>
> No empirical evidence that's definitive, but theoretical proofs exist,
> (and not based on invisible heat sorting demons or market information
> communicators).
Well if you believe you can point us to a theoretical proof I'd be interested
to see it (seriously).
I'd have to say however that I'd be extremely sceptical of any proofs,
because.
(1) The theory of the free market relies on a number of completely
unrealistic assumptions anyway (people have perfect knowledge,
people and companies always behave rationally, it's easy for
new companies to enter a market etc.)
(2) Managing an economy/Governing a country is really a pragmatic
thing. It's about responding appropriately to different circumstances.
It's about finding compromises between the conflicting needs of
different people/goods. NOONE yet has developed a suficiently
good understanding of how economies work for there to be
any one theoretical model that explains everything. And
when Governments try to force everything into any one theoretical
model instead of being pragmatic, they always run into trouble -
as most of the former Communist countries did, and as the Conservatives
did in the UK.
That for me is one of the real problems with where you're coming
from - you've got this great-sounding theoretical idea that if
we had a pure free market everything would be great - and you're
arguing for rigid following of this nice theory. The World doesn't
work like that - you've got to be pragmatic about it. And to me,
experience seems to show that something that approximates a free
market works pretty well but ONLY when Governments are willing to
step in and guide the operation of the market to some extent, to do
things like mitigate the bad social effects of the free market, and
make sure firms behave ethically and fairly, and to ensure services
like environmental protection and defence are provided.
> Further, the less intervention there is, the longer the booms last and
> the less severe the busts are. That is pretty solid. It's also a pretty
> strong correlation with solid linear behavior.
Is that really solid??? Again I'd be interested to see the data, since you're
claiming a correlation on something that cannot be precisely measured
or even defined.
Intervention can happen in numerous different ways - some of them appear
to have bad results, some of them appear to have good results. I'm
arguing that intervention should be done in ways that experience
tells us has good results. Once again I'm being pragmatic, and by
lumping all 'intervention' together as one thing you appear to be
trying to follow a model which is going to be too simplistic to be
of universal value.
Yor claim doesn't even match up with my understanding of history over
the last hundred years or so. Don't forget that the biggest bust of all
was the Depression of the 20s/30s
and occurred at a time when free market
ideas were very much in vogue. The much more interventionist,
Keynesian policies that subsequently became fashionable came in
response to that, and they do appear to have been the right policies
in the circumstances. Obviously since then times have changed so
Government policies need to change too.
> Now, true, the ideal gas law, based on similar linear trend analysis,
> predicts that the volume of a gas at 0 degrees K is 0. We know that
> isn't true. But it's a pretty good predictor of gas behaviour over a
> wide range of pressures and temperatures.
Nice try, but thhe analogy doesn't work too well because
the experiments that lead to
the ideal gas law were based on the kinds of quantities that
can be defined precisely and measured easily.
> So I say lets see how close to 0 degrees K we can get.
While I'd say that we've already got as close as we can get before
the disadvantages of moving closer to zero outweigh any
advantages.
Simon
http://www.SimonRobinson.com
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Message is in Reply To:
 | | Re: What happened?
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| (...) No empirical evidence that's definitive, but theoretical proofs exist, (and not based on invisible heat sorting demons or market information communicators). Further, the less intervention there is, the longer the booms last and the less severe (...) (25 years ago, 27-Jul-99, to lugnet.off-topic.debate)
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