Monday, September 22, 2008

Freedom and Changes in the Level Regulation

The problem that I see here is that when people have freedom sometimes bad stuff happens but with highly restricted freedom different bad stuff happens. Unfortunately people are inclined to believe that if you try to prevent bad stuff from happening through restrictions of freedom (generally called by the nicer name regulation) then less bad stuff is likely to happen. But human behavior is so complex and our understanding of it so limited that the restrictions of freedom beyond some old tried and true basics are not likely to have a bet benefit but. This seems to the story for not only economic issues but for things like recreational drug use.

Another big problem is that changes (either more or less regulation) can cause bad stuff to happen in the short term but be good long term. In the case of deregulation people get angry but in the case of more regulation people assume that regulation was meant to do good and so they support it.

The adjustments can be harsh. E.G. if you suddenly legalized all recreational drugs the news people would have a feast reporting on lives destroyed by drugs.

Freedom advocates get blasted for the great depression but FDR is lauded because he tried stuff, but the great depression lasted 10 years after the election of FDR. I think that if FDR was a do nothing advocate (freedom advocate) and depression persisted he would have been gone in 4 years. The country would have recovered either way. There is little evidence that FDR's policies helped end the depression sooner than otherwise. There was a rather sharp serious depression in 1920 - 1921 but Warren G. Harding did little to address it in fact, he cut government spending but the economy quickly recovered.

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