Archives for posts with tag: Free Market

One of the lies that is being peddled of late is an alleged Obama “War on Coal”. This is repeated for natural gas and oil, as well. The idea is that massive over-regulation by our commienazisocialistkenyanmuslimchristianhawaiianohwhatthehellcallhimeverynameinthebookandseewhatsticks President is somehow dejobbing coal miners and well drillers, causing poverty, blight, and maybe even gum disease. There’s a little problem with this scenario, however: it is not true. Not even a little bit.

It is true that coal output is down, and mining jobs are being lost (in some parts of the country). But it has nothing to do with President Obama (or Bush, or any occupant of the Oval Office): it has to do with the free market. Here’s how it works:

Due to the lightly-regulated natural gas market, lots and lots of gas wells got drilled in the past few years. So many, in fact, that the price of natural gas is lower than a politician’s moral standards. So low that lots of power plants switched from coal to gas to save money and earn bigger profits. Less coal being burned means less coal needs mined, so fewer miners are needed. That is the free market at work, and the government had almost nothing to do with it.

Gas drilling jobs are down, because the lightly-regulated market had so many gas wells drilled of late that the market price of natural gas is so low, it isn’t profitable to drill more gas wells. That is the free market at work, and the government had almost nothing to do with it.

Oil drilling jobs are up, and the United States is closing in on Saudi Arabia for the title of biggest oil producing nation in the world; because the lightly-regulated markets have created a surplus of well-drillers who used to work in the natural gas fields, along with new technologies and more available land on which to drill. Plus the price of oil is high, so it is profitable to drill. That is the free market at work, and the government had almost nothing to do with it.

In other words, the Republican ideal of a free market is responsible for the current energy market and the jobs associated therewith. The government (especially the President) cannot be blamed for the jobs that are lost, nor given credit for the jobs that are gained.

So if you’re spreading these lies about an “Obama war on fossil fuels”, STFU. If you’ve been believing the lies about an “Obama war on fossil fuels”, stop.  It’s a bunch of bulls***, like most things we hear from politicians and lobbyists.

Mr. B & C

As your friendly neighborhood blogger blunts and cranks his way through the 2012 Silly Season, he is glad to see (and he is not the only one to have expressed this sentiment) a serious debate on the proper role of government. As a radical centrist, it is not likely that his own personal views will be put into action, but these questions have been inadequately considered for far too long now, and just the fact of a discussion could make this election year potentially more useful than has become the norm.

At one time, the U.S. Government pretty much did what nobody else could or would do: make laws, protect the public, build big stuff that didn’t make a lot of profit, set standards, make war, and such. Normal government functions, in a tradition that goes back for thousands of years. As governments tend to do, it gradually became less and less efficient, and thus more and more wasteful.

From time to time, various efforts were made to cut out waste, and these encountered various degrees of success, though none were completely successful. One idea that gained wide acceptance during the last few decades was to make government “run like a business”. In theory, an inefficient business fails of its own accord, according to market conditions. So treating government in a like manner would ensure efficiency and thus success.

This is a seemingly well-constructed bit of logic, and when presented convinced a large number of Americans to go along with the idea. However, as a student of logic, Mr. Blunt and Cranky was long ago taught to examine the premises behind any seemingly logical statement to see whether or not it is true (true is not the same thing as logical). This one fails to hold up under scrutiny.

Government is not a business: businesses sell products/services to earn a profit (or to break even in some cases). Government supports businesses, of course (for a variety of reasons) by providing services, infrastructure and incentives, but government’s core product is not inherently profitable: the maintenance of a reasonably safe and orderly society. Examples:

  • Military, to protect the people from foreign threats
  • Law enforcement and firefighters to protect the people from local threats
  • Infrastructure like roads, utilities and such to facilitate commerce

 

There is a reason why businesses don’t tend to go into these areas: they are not profitable. Regardless of any Randian pipe dreams you may have heard, these “products” have never been profitable (some isolated bits and pieces are, and businesses do flock to those few profitable chunks), and no rational business person would ever undertake them.  Government built and/or enabled the building of nuclear power plants, our ground and air transport systems, utility grids, radio and television, communications wired and wireless, and a host of other essential services. None of these create or have ever created a profit for the government that may be viewed on a balance sheet.

 This does not mean that the services provided by government are worthless: cash is not the only measure of worth, after all. Businesses make profit in part by utilizing these government-enabled services, but the government itself does not. People profit in a certain sense by having safety, water, roads and such, but government does not record a monetary profit.

Governments “profit” not in the monetary sense: successful (“profitable”) governments are those that preside over an orderly society full of citizens who are reasonably satisfied with their lot in life, who are reasonably satisfied with the job that their government is doing; and if satisfied, they return elected officials to office for additional terms. The public-sector “profit margin” could be determined by election/re-election statistics, approval ratings and poll numbers.

If we accept that definition of governmental profit, then the margin is pretty darned low these days. Maybe government should be run like a government, since running it like a business has been steadily decreasing the “profit margins” of all three branches of government.  The experiment has failed, time to go back to what works.

Mr. B & C