Politics and Economics: A Deadly Mixture

 In a free market economy, individual firms rise and fall, individual banks succeed or fail, and individual employees prosper or struggle, depending on their own effort and ingenuity. Individual failure, while painful, is not a threat to society, and a well functioning free market provides the kind of growth and opportunities that almost always renders such failure a temporary setback on a long-term path to prosperity.

By contrast, in a government controlled economy, every commercial decision can inspire a mass movement, every wage adjustment or hiring decision can cause a demonstration or protest, and every bankruptcy is an excuse for a government bailout.

What we are seeing in Greece is not an aberration. It is rather the logical result of a system in which government has gradually taken over more and more responsibility for economic decision-making. When you are aggrieved at work or in the marketplace, and government is also your boss or your commercial competitor, your only recourse, indeed your proper recourse, is political action to change government’s actions. In a well-functioning democracy, such political action might be confined to the halls of parliament or congress, but no country, including our own, is immune to political action in the streets.