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The trillion dollar bailouts are indeed central planning, but they are a reaction to a failure in distributed planners as recognised by the most firm believers
by quietbritishjim 6y ago
The trillion dollar bailouts are indeed central planning, but they are a reaction to a failure in distributed planners as recognised by the most firm believers in distributed planning. As in, "Oh crap, this free market is in the process of unravelling, the only way to stop it is to throw a bailout at it." So it's still a product of decentralised planning (to use your term).
The reaction following a bailout is usually, "whoops, we didn't do enough central planning beforehand" i.e. the new banking regulations such as tighter loan-to-deposit ratios. So, overall, this supports the parent comment's point of the inefficiencies of decentralised planning.
- drran 6y agoUSSR, as the country, failed because of central planning. Bailout is not a good solution too, because capital flow from competitive players to incompetent, which is bad for evolution. US banking system is far behind other banking systems because of that.
- quietbritishjim 6y agoI absolutely was not expressing an opinion either way. All I was saying is that the parent comment was raising a point that supported the opposite argument than they thought, not that I agreed or disagreed with it.
- chordalkeyboard 6y ago> they are a reaction to a failure in distributed planners as recognised by the most firm believers in distributed planning. No, they are a reaction to the perceived failures of “distributed planning” as perceived by advocates of central planning. Free marketers have always said that those banks need to be allowed to fail because they made bad decisions and bankruptcy sells their assets so the creditors can get paid and new management can operate them. With bailout you have this bizarre system where profits are privatized and losses are socialized, which is not a distributed system or a free market.