possible. And unelected bureaucrats, being human, would be happy to take as much power as others were willing to give them.
C UTTING O FF THE I NVISIBLE H AND
A S FOR THE TREASURY secretaryâs desired role to become economic czar and CEO of the American economy, Nobel laureate F. A. Hayekâs famous essay âThe Use of Knowledge in Societyâ offers the best rebuttal. â If we possess all the relevant information 22 , if we can start out from a given system of preferences, and if we command complete knowledge of available means, the problem which remains is purely one of logic,â Hayek argued. âThis, however, is emphatically not the economic problem which society faces. . . . The reason for this is that the âdataâ from which the economic calculus starts are never for the whole society âgivenâ to a single mind which could work out the implications and can never be so given.â
Hayek used this argument to dismantle the idea that socialist systems could supplant price discovery through the market process with well-meaning, smart bureaucrats. Markets, through their decentralized nature and their ability to incorporate the individual knowledge of time and circumstance, provide a far superior approach for coordinating the individual plans that drive economic growth.
Not surprisingly, the Obama administrationâs enthusiasm for the discretionary power of the program, originally scheduled to sunset in December 2009, has not waned. Treasury Secretary Timothy Geithner readily sent the pro forma letter to Congress required to extend the life of the program for two more years. The Democrats now in power seem intent on using TARP as a slush fund for various pet projects.
C OALITION OF THE U NWILLING
T HE DAY AFTER P AULSON released his sweeping plan, FreedomWorks quickly connected with other free market groups to assess their willingness to fight. It was a surprisingly small group. But a principled few stepped up, notably Andrew Moylan of the National Taxpayers Union. The Club for Growth and the Competitive Enterprise Institute also weighed in, and Dan Mitchell at Cato and the folks at Reason.com offered much needed policy support. The groups joined forces with a few free market Capitol Hill staffers who also were feeling remarkably isolated in their efforts to stop the massive government bailout.
Many groups that would traditionally fight such a massive outlay of taxpayer funds to irresponsible businessmen were sitting this one out, on the sidelines. Others would actually support the Republican administrationâs efforts. The diffidence of many of our usual allies was striking.
Much of the recalcitrance from right-of-center organizations seemed to be driven less by principle or substantive policy analysis than by a reluctance to challenge a Republican presidentâeven one who had been a great disappointment on the key issue of fiscal restraint. Were some more concerned with maintaining a relationship with the Republican White House than promoting the principles of limited government? We did not know.
Another problem is that it is much easier to pick sidesâDemocrat or Republicanâand go along with whatever the leaders say. This is a simpler path than trying to think through each issue based on facts and principles. The more years one spends in Washington, the more tempting this path of least resistance looks. Plus, there are a lot more jobs for party loyalists than there are for those of us who are constant thorns in the side of the establishment because we have principlesâas if thatâs a bad thing.
Some free market grassroots groups were conflicted, holding public debates within their own organizations in an attempt to maneuver around various relationships with the Bush administration, politicians in Congress, candidates, and financial interests. They used the same flawed logic many on Capitol Hill used to convince themselves to support this giant
C UTTING O FF THE I NVISIBLE H AND
A S FOR THE TREASURY secretaryâs desired role to become economic czar and CEO of the American economy, Nobel laureate F. A. Hayekâs famous essay âThe Use of Knowledge in Societyâ offers the best rebuttal. â If we possess all the relevant information 22 , if we can start out from a given system of preferences, and if we command complete knowledge of available means, the problem which remains is purely one of logic,â Hayek argued. âThis, however, is emphatically not the economic problem which society faces. . . . The reason for this is that the âdataâ from which the economic calculus starts are never for the whole society âgivenâ to a single mind which could work out the implications and can never be so given.â
Hayek used this argument to dismantle the idea that socialist systems could supplant price discovery through the market process with well-meaning, smart bureaucrats. Markets, through their decentralized nature and their ability to incorporate the individual knowledge of time and circumstance, provide a far superior approach for coordinating the individual plans that drive economic growth.
Not surprisingly, the Obama administrationâs enthusiasm for the discretionary power of the program, originally scheduled to sunset in December 2009, has not waned. Treasury Secretary Timothy Geithner readily sent the pro forma letter to Congress required to extend the life of the program for two more years. The Democrats now in power seem intent on using TARP as a slush fund for various pet projects.
C OALITION OF THE U NWILLING
T HE DAY AFTER P AULSON released his sweeping plan, FreedomWorks quickly connected with other free market groups to assess their willingness to fight. It was a surprisingly small group. But a principled few stepped up, notably Andrew Moylan of the National Taxpayers Union. The Club for Growth and the Competitive Enterprise Institute also weighed in, and Dan Mitchell at Cato and the folks at Reason.com offered much needed policy support. The groups joined forces with a few free market Capitol Hill staffers who also were feeling remarkably isolated in their efforts to stop the massive government bailout.
Many groups that would traditionally fight such a massive outlay of taxpayer funds to irresponsible businessmen were sitting this one out, on the sidelines. Others would actually support the Republican administrationâs efforts. The diffidence of many of our usual allies was striking.
Much of the recalcitrance from right-of-center organizations seemed to be driven less by principle or substantive policy analysis than by a reluctance to challenge a Republican presidentâeven one who had been a great disappointment on the key issue of fiscal restraint. Were some more concerned with maintaining a relationship with the Republican White House than promoting the principles of limited government? We did not know.
Another problem is that it is much easier to pick sidesâDemocrat or Republicanâand go along with whatever the leaders say. This is a simpler path than trying to think through each issue based on facts and principles. The more years one spends in Washington, the more tempting this path of least resistance looks. Plus, there are a lot more jobs for party loyalists than there are for those of us who are constant thorns in the side of the establishment because we have principlesâas if thatâs a bad thing.
Some free market grassroots groups were conflicted, holding public debates within their own organizations in an attempt to maneuver around various relationships with the Bush administration, politicians in Congress, candidates, and financial interests. They used the same flawed logic many on Capitol Hill used to convince themselves to support this giant
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