Central Planning Failed in the USSR, but Central Banks Have Revived It

Crony capitalism flourishes in big government.

In fact, the only way to reduce the corruption of crony capitalism is to separate business and the state as much as possible and then to reduce the corrupting enabler, government, to the greatest degree possible. Government is where cronyism lives. If the government has power, entities will seek to exploit that power. In many ways government is just a tool of large vested interests. But it is given the patina of legitimacy with flowery homages to “democracy” etc. from crony politicians.

The central planners think they know best. What’s worse is that many reasonably bright people actually agree with the central planners.

But the central planners don’t know best however and history has shown us this over and over.

(From Mises)

When I left the Soviet Russia in 1991, I thought I would never see a command-and-control economy again…

But he was wrong.

 …Over the past decade the global economy has started to resemble one, as well-meaning economists running central banks have been setting the price for the most important commodity in the world: money.

In other words our current interest rates don’t reflect reality. The distance between reality and centrally planned interest rates represents the degree of general disruption one can expect when reality, the real price of money, inevitably breaks through.

Click here for the article.