Saturday, December 5, 2009
Economy's "Goals"
A lot of people are talking about government intervention in the economy. Unfortunately there's a self-fulfilling prophecy there, combined with the fact that we as a society have a short memory, that causes problems. Let's go back a little ways: does anyone remember how this recession started? People complain about government intervention, but they fail to realize that government intervention was the initiating factor. Alan Greenspan held the Fed's rate to a very low 1% for far too long, creating a housing bubble that would inevitably burst. Then we've got people in Congress saying "we don't need government intervention." That would be true if we had a truly free-market economy, but if something goes wrong from government intervention then it takes a similar type of intervention to fix the problem. People don't seem to remember that. Fewer people remember that the United States government tried to intervene in the Great Depression, but didn't do enough. It's a good thing the current administration learned from the mistakes of the past- at least in that case.
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I definitely agree on parts of your post. I think it is important to notice that the public has often misinterpreted the interventions the government has been making. The constant back and forth of the parties has made it difficult to tell whether it's intervention or normal for the government to be doing what they've been doing.
ReplyDeleteI also agree with parts of your post. We, as a society, do have somewhat of a limited memory. However, I feel that it will never be the case that people actually agree on the amount of government intervention that is good for us. Even with that being said I am sure that from day to day and month to month our opinions will vary greatly. I am assuming that most people who were against a lot of government intervention were singing a slightly different tune once the New Deal panned out the way that it did.
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