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May 13, 2009
Is Vertical Central Planning Our Future?
What began with the banks has spread to the auto companies. Are the insurers of home-and-car next?
Alan Aronoff wrote in an American Thinker piece entitled “The Politicization of the Auto Industry” that,
“The American automotive industry will not be nationalized under the Obama administration; it will be politicized.”
The common denominators of nationalization and socialism are collectivism and its modus operandi -- central planning.
In the spirit of Henry Ford, who resisted FDR’s National Recovery Administration (NRA), the Ford Motor Company has not accepted bailout money. It will soon be the only U.S. auto manufacturer without a major ownership role deeded to the federal government and the United Auto Workers Union.
When the price of gasoline moves toward the $4.00 per gallon mark again, and stays there, Ford sales of trucks and SUVs will decline. Its revenue from car sales won’t be able to sustain the company. Bankruptcy is likely in its future, also. Though not right away.
In the meantime, Ford will essentially compete, not just against other car companies, but against the political agenda of President Obama and the Democrat Congress.
So, with the financing of homes and automobiles politicized, if not nationalized, and with two of the three auto companies even more so, what’s next along that vertical market? There’s no reason to think that the drive toward vertical central planning ends there.
Why not a consolidation of several of the large home-and-auto insurers into a politicized, or outright owned, entity that offers standardized and “fair,” because that’s an important goal with the Obama administration, insurance rates in the common interest of the nation? If the government already stands behind the financing and construction of homes and vehicles (housing and transportation), it’s not a big step to protect the government’s investment by politicizing the insurers. Right?
It’s all about vertical central planning -- moving either from the bottom up, or the top down.
The effort’s well underway to vertically central plan health care industry beginning with insurance. How hard will it be to move up from there to hospital ownership and, eventually, government staffing? Just imagine the Veterans Administration (VA) hospital model writ large.
And what’s to stop the eventual extreme politicization (beyond the existing politicization through the teacher unions) of the K-12 Public School system?
Impossible, you say. Alarmist. Fanciful. Extreme right wing rhetoric. But,
“If we are, nevertheless, rapidly moving toward such a state, this is largely because most people still believe that it must be possible to find some middle way between ‘atomistic’ competition and central direction. Nothing, indeed, seems at first more plausible, or is more likely to appeal to reasonable people, than the idea that our goal must be neither the extreme decentralization of free competition nor the complete centralization of a single plan but some judicious mixture of the two methods. Yet more common sense proves a treacherous guide in this field. Although competition can bear some admixture of regulation, it cannot be combined with planning to any extent we like without ceasing to operate as an effective guide to production.” (F.A. Hayek, winner of the Nobel Prize in Economics, The Road To Serfdom, 1974.)