Free Market Failure? A view before the dust settles

29 09 2008

Was lying on my back in an orthodontist chair today . . .

OK, what’s a 50 year old guy doing at an orthodontist? Trying to avoid a jaw operation later. Dentist found out my jaw’s not setting properly and causing teeth problems. Choice – jaw operation later or braces now. Bummer. New book release this fall and I need braces. Apparently I’m not alone. Significant part of this guy’s business is adults! Where was I ….

Oh yeah,Congress just rejected the Prozac bill to stave off U.S. financial Depression today. Some say this whole mess is indicates a failure of the free market. So my orthodontist offers the thought – how could it be free market when the mess was caused by Fannie and Freddie? I mean aren’t those guys supported by the government? Good question. What if they weren’t? What if their owners and execs had to bet their careers, personal wealth, and reputations on their capacity to understand risk and return? Would they have been so frivolous and irresponsible to take on such risky loans? Perhaps this isn’t a Free Market Failure, but a Government Interference Success!

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