Wednesday, August 10, 2005

The Economy

I am always a little wary when I hear people, especially politicians, talk about "the economy," or the economy as a whole. To personify the economy as if it were independent of individual human actions is to mischaracterize it as a mysterious and independent force, or a giant, collective bundle of data. Such mischaracterization of market functions ignores the fact that the economy is simply the result of billions of voluntary transactions which allow both parties to the transaction to better meet their needs. Such mischaracterization justifies the use of force to control the economy, which is really to control the voluntary transactions taking place. Such mischaracterization may be responsible for quotes like these, all taken from the same article referenced above, "we're more concerned about energy prices and health care prices ... Those are the two areas that we see as having a greater effect on ... the future of economic growth," "there's still some challenges to the economy," "his [the President's] handling of the economy" and, "the economy created 207,000 jobs in July."

The economy is not something that politicians need to watch over, as all of the above quotes suggest. I agree that, "The economy of the United States is strong and the foundation for sustained growth is in place," but the foundation is economic freedom, not additional regulation.

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