Financial Crisis, Government Malfeasance, and Market Solutions to Sustainability
Professor Douglas A. Hensler, Wichita State University, United States
A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned - this is the sum of good government.
Thomas Jefferson
The current financial crisis in the United States of America, mirrored in some other countries around the world, has its roots in government intervention in markets, which interferes with market solutions for price, quantity and distribution, along with central planning policies that have heretofore been relegated to failed experiments. Ill-guided politicians, supported by central planning advocates, will relegate the American economy to a path of also-ran on the global economic scene. Ironically, China now leads the world in capitalistic growth that was once the cornerstone of American enterprise and exceptionalism.
Interference in the markets based distribution of goods, including the social good, has led to an unprecedented collapse of American prosperity. Starting in the residential real estate market, the federal government in the United States now appears determined to spread the anti-markets, anti-economic principles disease to energy, healthcare, and defense, as well as further into education. This central planning approach to matters best solved in a guided free markets arena is destined to lead the United States to a position of sub-optimal status with profound negative effects on the global economy and on sustainable development.
In the past, Sustainability has always been part of American enterprise. No business thought of itself as existing for a short period of time only to die. American enterprise is not alone in the idea of going beyond Sustainability to a state of thriving, creating value, and growing. Not perfect, there have been errors that negatively affected the environment and society, primarily borne of ignorance, but on whole the progress of the social good and environmental advances have been rooted in the exercise of free market solutions and applications of technology to business, economic, social, and environmental problems. To abandon market forces now, which have not only been a useful mechanism for solving problems but the engine of value creation and prosperity that elevates society, is not just folly, it is economic, environmental, and societal suicide.
The way forward is to view Sustainability as a joint optimization problem in the context of BESTBEST Business Excellence. BioPhysical-Economic-Social-Technological Sustainability laces the problem squarely in the realm of optimizing the three dimensions of the BioPhysical (Environmental), the Economic, and the Social through the development and application of Technology within free markets with strategically placed incentive structures free of government micro-management.
