The Invisible Hand Part 2 - Why Have A Government?
Thursday, October 2nd, 2008I just deleted several hundred “spam” comments from my comment moderation queue. The mysterious originators of these comments, which are then automatically generated in huge numbers around the Internet, aim to attract or influence commercial traffic in their direction. I don’t really care whether the operation works. I presume it does, since otherwise why would they keep doing it? But I care about having to delete all of those messages when I have better things to do with my time.
A couple of weeks ago I was on the phone with my friend in Australia just after the AIG bailout and he mentioned that had AIG gone under he would have been left in the hole for several hundred thousand dollars. Many clients of his medical business have insurance with AIG. The fingers of this particular invisible hand spread far.
But why did AIG, with its trillion dollar balance sheet and stalwart history of conservative risk management need to be bailed out?

Joseph P. Cassano AIG Financial Products
Well, if the NY Times has its story straight, AIG’s problems were catalyzed by the overreaching overconfident overpowerful work of one man — Joseph J. Cassano, a former executive with Drexel Burnham Lambert — Michael “the-junk-bond-king” Milken’s old investment bank. Cassano helped found AIG Financial Products in London and built it into a very profitable, very independent entity within AIG that leveraged AIG’s tremendous financial strength and standing to sell ever more speculative products. AIG Financial Products, being drastically overleveraged, eventually imploded. Cassano left and now lives quietly in a Knightsbridge town-house. (I love this picture from the NY Times; Cassano peering around the corner in his bright red shirt like a con at the perimeter of the prison yard.)
When McCain debated Obama last week after supposedly spending several days in intense economy-recovery sessions he didn’t seem to have much of a grasp on what had happened to cause the problems in the first place, nor on what needed to be done to avoid them happening again. It was as if invoking the specter of regulation caused him such shudders that it wobbled his brain off-kilter.

John McCain at a loss
Ideally, regulation is what we do when we don’t want something bad to happen. Avoiding regulation is something we do when we care more about a belief or concept than real-world consequences.
The Bush administration has been bad for America and the world for many reasons, but there has been one overriding and all-pervasive reason for its badness — the arrogance of favoring faith over fact. The administration has consistently argued for, lied for, evaded for, invaded for, and bullied for its ideologies in the face of the evidence against them. They have set the bar very low for what a government can do to manipulate and subvert in the name of ideology and get away with it.
All that being said, when the congress began beating up on Paulsen and his three page proposal I felt for the first time in a long time that we were seeing government in action. Rusty, creaking, inept as it may have been, the house gave us the hint of an idea of what it should be doing for us — working in our best interests. For once we got a glimpse of the invisible hand.
Related posts from around the web:
Walter Williams and Bryan D. Jones: The Most Important Election … - Choose McCain and likely opt for a third term of the governing philosophy that has pushed the United States back toward the economy of the Great Depression. Select McCain and keep the governing approach of unregulated free market …
McCain Touts Plan to Privatize Bailout [3rd attempt] - “The problem with the earlier plan,” McCain explains, “is that it relies on big government to save the banks. My plan puts the bailout in the hands of the free market, which is the only solution that works in times like these.” …


A
Through the seventies, eighties, and nineties, when the Provisional IRA (the IRA) carried out apparently endless campaigns of violence against other Irish citizens, the British army, and British citizens, there seemed to be no way to reach a peaceable conclusion. For a very long time, the British trotted out the line that they wouldn’t have anything to do with terrorists. And what happened in the end? In 2005, after much discussion and compromise on both sides, the IRA renounced violence. The political wing of the IRA has been integrated into Irish politics.
But here we have the really difficult question, do names matter, philosophically speaking. Psychologically, they clearly do. But if we can narrow a concept and label it have we achieved anything more or less than narrowing a concept and labeling it?
The
And slowly but surely
As we’ve seen with the Catholic church in recent years, the infallible have a lot to learn. Errors of national ego punctuate the history of civilization like buckshot. The only thing that can save us from even worse transgressions and further isolation is a healthy dose of humility.
On a less happy and more serious note, the editorial board of the
Which brings me to a 
A few days ago I wrote about the
While evidence of the administration’s
The NY Times today called for an upgrade to electronic voting systems across the land… by entering a plea for jurisdictions to
Last week I thought I had
Another educator, John Farmer, who teaches at Rutger’s Law School,
Bush seems to have a very personal feeling for this philosophy. It speaks to him. After all, he came to power under the same diktat from big business and wealthy donors. ‘We’ll fund your campaign and support you in your bid for the presidency, but we expect results.’ And he delivered by cutting taxes, protecting and facilitating industry and big business interests, and handing down spectacularly rewarding contracts in the defense and reconstruction industries.
Which brings me to think that accountability and trust may be inextricably related from a philosophical perspective. We might test this theory with an example from the world of finance. Bear Stearns CEO, 
just as the slaughter of turkeys can put a damper on the idea of Thanksgiving. As the story about the Paletine cave mentions, Romulus, for whom Rome is named, went on to kill his twin brother Remus in a power struggle.
Tradition, history, and legacy work as a double-edged sword. They can help to maintain some of the best traditions, remind us of great moments, movements and passges in our history, and it can help maintain some of the worst. Without thoughtful reappraisal and rational questioning of why we hold onto certain laws or patterns of behavior, we will inevitably hold onto bad laws and patterns of behavior. For this reason, I think, we are right to question even those seemingly innocent and well-respected traditions. Today’s cause for celebration, after all, may be tomorrow’s cause for shame.
Last week 