Dictating Markets

SEARCH BLOG: ECONOMY and STUPIDITY

I've mentioned it before: stupidity has its own rewards.

As state and federal governments [especially courts] become more proscriptive about what should be as opposed to what the markets are saying wants to be, more and more economic dislocations are occurring... and opportunities are moving to places that focus on the latter.

For example:

• The government says ethanol production should be increased. If you invested $10,000 in that effort last year, your investment would now be worth $7,500... and the cost of corn products has increased for everyone else.
  
• The government says oil and natural gas exploration in the U.S. and offshore areas should be restricted. The U.S. now imports more oil and natural gas than ever before at much higher costs than ever before with far less assurance of availability.
• A certain western state says that fuel mileage requirements should be raised by 40% within a few years. The result will be both fewer choices and higher cost than allowing the marketplace to operate.

Here in Michigan, the governor says the state economy should be growing, so she plans to tax us as if it is.

Why do so many citizens believe that the government should be allowed to dictate what the marketplace should be?

They simply want the government to be their proxy so that they can tell you and me what we should be doing.

So are they being stupid for proscribing what should be or are we being stupid for allowing them to dictate what should be?

Yes. And we are all reaping the rewards.

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