Redstate

By Repair Man Jack Posted in Economy — Comments (8) / Email this page » / Leave a comment »

It’s easy to go off on a flight of fancy and say something like. “If I were king for a day, gas would be $0.25 a gallon.” All it costs is a minute amount of CO2. Regrettably, Zimbabwean Despot Robert Mugabe believes he can wave his magic wand and actually do this in real life.

What’s worse, this idiot really is king for a day, and then another one, and then another. At least he seems destined to remain in power until he runs out of human chattel to brutalize, starve, arrest and shoot. The man is a living exemplar of what happens when Darwinian Evolution goes into high-speed rewind. By the time he relinquishes his power, bombing Zimbabwe back into The Stone Age may indicate forward progress.

Mugabe’s most recent flight of fancy involves an edict by which most prices, in all stores, are hereby cut in half. He might as well have his bogus parliament pass an edict ordering gravity to accelerate the downward fall of massive objects by 4.9 m/sec2. Like the laws of physics, the laws of economics are generally immutable. You don’t just beat them by hiring a better lawyer.

Mugabe’s economics have had predictable results. Pricing something artificially lower leads to buying in runs, followed by shortages and hoarding. Businesses unable to make money when the external prices they sell for have dropped by 50%, but their internal prices have stayed on Zimbabwe’s ludicrous 3,700% inflation curve, have shut down.

Mugabe has done what every good liberal reflexively resorts to. He has blamed the business sector for not turning his economic policies into better tasting chicken salad.

The government has accused businessmen of deliberately raising prices in order to cause unrest and bring down President Robert Mugabe.

Blessedly, we in America do not partake in any such nightmare. I’m tempted to attribute that to the fact that we have an educated, highly literate electorate who would never vote for someone who told them he could set the prices of everything by legislative fiat. That line of thinking would prove delusional. American politicians are just as stupid as Robert Mugabe on matters related to economic thinking and policy.

Fortunately, politicians in America face tougher hurdles on the way to the bucolic, unproductive economy of our fore-fathers. Our recent Senate Energy Bill offered a prime example of how bad economic thinkers hijack legislation to offer up policies they believe will enhance the commonweal. This bill includes a convoluted Dog’s Breakfast of economic stimuli that would purportedly make our economy more energy efficient. Had this bill passed in its unadulterated form, it could have made a gallon of gasoline cost over $6.00. Not quite Mugabesque inflation, but then again, the Democrats lack a filibuster-proof majority.

How do reasonable, fair-minded Senators from prosperous states full of movie stars and high technology morph into Mugabe-like morons when the policy debate turns economic policy? The answer is baronial arrogance; appalling, unmitigated, self-infatuated arrogance. Hillary Health Plan, John McCain condescending straight-talk arrogance.

Senator Diane Feinstein used to be the female Senator from California whose tether still remained attached to terra firma. Now, despite the conspicuous absence of an engineering degree from Cal Tech on her resume, she has the following edict for American automakers.

“What the China situation, or the other countries’ situation, shows is that these automakers, in all of these countries, build the automobile that the requirements for mileage state. And they don’t fight it, they just do it.’’

Unfortunately, her legislative assistants haven’t explained to Senator Diane that auto executives in China who fail to hit these targets, get shot, and not in the stock option. That would be considered gauche and bourgeois by the San Francisco avant-garde.

Another characteristic of engineering that has escaped the intellect of the Senator from the land of capital burn-rates and virtual reality is the trade-off. To put it nicely, automotive engineers can’t just hack into the matrix like Neo. They have to give something up in terms of performance, style or safety for every mile per gallon of fuel economy.

Either that; or they could just make like Zimbabwean businesses and raise their prices; just so they could be mean and un-elect Senator Feinstein. This is how things work in the non-virtual reality where businesses make payrolls, production schedules, face regulatory mandates and are still expected to produce a sizeable profit on behalf of the shareholders.

We in America have avoided our own Robert Mugabe so far. Jimmy Carter did his best, but he lacked the despotic competence. We have an open system of elections that allows us to weigh perspective economic policies in the balance. If we find a politician’s ideas lacking, we, not the President, not the Congress, are ultimately the deciders. We need to make better decisions about who we keep sending back to the US Senate.