Wednesday, March 16, 2011
There is much I disagree with in Megan McArdle's Atlantic piece on "When Rail Becomes Ridiculous," but she makes an intriguing point about a couple of central planning proposals for bullet trains:
[I]s it really a good demonstration project if the train doesn't have any passengers? Or if the people to whom you've demonstrated it finish their trip in Bakersfield, sans car? It seems to me that this is a very good way to demonstrate cost overruns, disappointing passenger figures, and a single-minded committment [sic] on the part of rail advocates that defies common sense.McArdle is right, but, alas, not as right as she fears. Have you ever heard of the "bridge to nowhere?" There are countless similar examples of blatant government waste right under our noses, not to mention ripple effects from central planning schemes. Indeed, Frederic Bastiat eloquently described such ripple effects in his parable of the "Broken Window" over 150 years ago.
As an environmentalist who wants the government to build railroads, McArdle should take heart for the same reason I, a rail buff who wants rail built only by private enterprises seeking profits, should be alarmed: We have mountains of similar evidence that central planning makes no economic sense and economists have understood this for the better part of two centuries -- and yet such evidence and understanding have little sway over public policy today. Worse, even some professed advocates of capitalism still seem to think that all we need is ... more evidence!
There are two broad problems here, the lesser of which is that the public is economically illiterate and used to the government planning practically everything to do with the infrastructure. The far greater problem is that most people (including many who think of themselves as pro-free-market) do not think in terms of principles.
[A] pro-capitalist would know what capitalism is, what it requires (full government protection of individual rights), and why statism and anarchy are inferior, and dangerous to [his] survival... He would know these things because he would rely upon free market principles when thinking about the economy. And he would know that if he doesn't rely on such principles -- if he "abandons" -- them, he will have no way to decide what [policy] is best...To such an individual, the bridge to nowhere, bullet trains in the sticks, and, for that matter, any proposal to compel people to pay for anything (outside fines or restitution for criminal offenses) are simply examples of violations of property rights, and he will oppose them as such. To someone who doesn't think in terms of principles (even if he considers himself capitalist), they will merely be individual, unconnected examples of "inefficient" government, and he will forever spin his wheels fantasizing about making the government better at performing an impossible task: Having a comparatively few people attempting to run an entire economy. In the meantime, these same bureaucrats and do-gooders will succeed in trampling his property rights, and he will scratch his head (if he's lucky enough to be merely frustrated) about all the poor decisions they keep making.
There is no bullet train to freedom in America. Voters have to begin to see again why any and all government interventions in the economy should be opposed, and they will not do so until there are more people making principled cases for capitalism.