I'll give you an answer Pericles.

Waste & incompetence by a company costs no one but the companies share holders. It does not last for long, because those share holders change the management, to people who are more efficient, or the company goes broke, & disappears.

Waste by government can & does go on for years. Prior to this totally incompetent government, growth in tax reciepts allowed public services to grow to a redicules extent, almost unnoticed by the general public. With this lot, it has grown so bad, that they have to introduce new taxes to cover the cost. That's getting noticed.

Telstra is a perfect example. In government hands it was massively overmanned. In private hands, despite a 50% increase in business,. & a 55% reduction in the work force, it is still over manned to such an extent, that it can not compete with the new competition, which has not suffered from public service feather beading.

These new telcos achieve 4 times the productivity that the slimmed down Telstra, still suffering from a public service model structure, can achieve.

When you get into actual departments it's much worse.

Have you ever been involved in one of the government consultation processes. Unfortunately I have. At one recent such bit of fluff on water conservation, an old dairy farmer got up & stated that he had checked his records.

He found he had attended 31 of these meetings, over 6 years. The only thing he could see that had been achieved was the number of public servants attending had increased from 15 to 25, 4 had retired, & 3 had been promoted, & not one decision had been made. Result, 10 more government pay packets, for stuff all result, & a bigger pension bill for us to pay.

He was not cheered, but he did get a standing ovation.

I'm at a loss, are there those here who advocate a complete free market society, with no government? I believe government weather right wing, left wing, center, run by Adolph Hitler or Mother Teresa by nature are interventionist, just not on economics but on most things that rule our daily lives. We need government to make laws, impose standards, run services, we demand it. Where would we be without government, some where in 19th century England?

Then some bring up the argument, I know of a specific case of dar da, dar da, dar da etc, I don't know what their point is, is that the justification for the abolition of government altogether? That line of argument is as absurd as if I said Lindy Chamberlain was wrongly convicted of murder therefor all those convicted of murder should be set free, but then again, without government there would be no murder convictions, problem solved.

I'm in agreement governments make mistakes, they get things wrong, but they also get things rights, so on balance are we better off with or without government? I'll take government any day over no government at all, and lets work to improve it, and make it better, not destroy it.

Well I don't know why people bother being Left or Right and centre this and that in our binary political system. It's got so we can't tell one party from the other anymore. I often visualize pollies of both parties lunching together and laughing at the passionate but pointless allegiances of all us humble mugs.

I haven't voted for either major party (ie: the ONE party, IMO) for a long, long time. I do my bit to try and get some variety in there. Like I plan to vote for the Pirate Party and I vote for independents now when the opportunity arises. Got to revitalize the political corpse if we can.

However, I'd have very much liked to see Kim Beazley have a go as PM.
I'd have voted for him. Still would.

Well I’ve been off having a life, specifically at the Canberra International Music Festival. I recommend both. But as the discussion is still ticking along, I’ll come back in.

Peter,
You seem to make some assumptions. One assumption seems to be that ‘society’ is the same thing as ‘socialism’. I don’t even know what to do with that, except to recommend a dictionary. And perhaps some study of the natural history of mammals.

Apparently another assumption is that the only way Government can intervene is by owning some of the means of production. You then argue that it won’t know how to price what it produces. I understand your argument – Hayek’s point that markets facilitate an immense amount of information processing. But I don’t accept your premise. Government can regulate traffic intersections and most people think that’s a good idea. Government can redistribute income and most people go along with that, though it’s a clumsy mechanism, because most people agree it’s OK to help out the less fortunate, within reason. (And there will always be debates about where to draw the line. My preference would be to neutralise all the mechanisms that redistribute income in the other direction, to the rich from the rest of us. Many of those mechanisms are already a result of intervention, so intervening to eliminate them shouldn't be a problem.) You might wish it do be done differently, but it’s hard to argue that it leads inexorably to breakdown.

In the roles just mentioned the government is being the referee, without owning anything. Of course the government’s interventions can affect prices, but who says “the market” gets the “right” price? You apparently don’t accept the neoclassical argument that it does, and I agree with you.

So that gets back to my central point. I understand Hayek’s argument about information processing, but that doesn’t mean the “processing” gets a good answer, or is rational, well-informed, etc. etc. It is patently obvious that financial market prices are inaccurate – they changed by 40% overnight in1987, without any change in objective reality.

Continued -

There are many other examples of market malfunction. So markets may process information, but we need to look at the answer they get and adjust it if it’s doing harm – like making honest people broke or trashing the Niger delta.

If you’re going to attribute Shell’s destruction of people’s livelihoods, BP’s destruction of the Gulf of Mexico and (?) the GFC all to government intervention then I don’t think I can have any more useful discussion with you. Our perceptions of the world don’t overlap enough. I think Pericles has been asking a very reasonable question.

Your basic question (a), how is partial “control” (I said "manage") different from full control, is hard for me to answer definitively because I struggle to imagine why you would think they are the same. I’m *guessing* you think the only intervention is through ownership, and that’s rather obviously not true. So that's my answer to that one.

Question (b). Government refereeing (of the markets) avoids the ‘calculation’ (or processing) problem by only nudging what the markets do, rather than trying to supplant the markets completely, as in communism. I agree with you modern societies are far too complex for the latter to work.

Paul1405 has raised the question of the role of government. My take is that governments (and the political process in general) are the way we collectively organise ourselves when we are in groups too large for our innate face-to-face social behaviroural repertoire to suffice. In other words when the groups are larger than a few tens (or possibly hundreds) of people.

If you imagine, as libertarians apparently do, that we don’t need any organisation of larger groups, then (given my argument that markets don’t yield desirable outcomes) I think you don’t understand the social nature of human beings, nor the central tension in all living systems between the welfare of the individual and the welfare of the larger system of which it is a part, and on which it depends.

I'm not sure that is the case, Hasbeen.

>>Waste & incompetence by a company costs no one but the companies share holders.<<

Tell that to the inhabitants of the Gulf coast watching the approach of a massive oil slick.

http://theenergycollective.com/TheEnergyCollective/64831

Or to the Alaskans still waiting for compensation for Exxon Valdez.

Tell that to the folks who find themselves without a home, thanks to the sales strategies of numerous US mortgage outfits.

http://www.theepochtimes.com/n2/content/view/32069/

Tell that to the farmer policyholders of HIH who couldn't spray their crops because their Public Liability cover had evaporated.

http://www.encyclopedia.com/doc/1P1-44235310.html

In fact, tell all the "little people" who had their daily lives disrupted with the demise of their public liability insurance at HIH:

"Many small businesses that required public liability insurance only, ‘stand alone public liability’ could not obtain the cover, and the same phenomenon was experienced throughout Australian society affecting everything from community association activities to special events such as school fetes through to high risk activates as bungee-jumping or horse riding and to the mundane such as public liability insurance required by a council for a wedding taking place in a park."

http://tinyurl.com/28kup5e (n.b.: this downloads a .pdf file)

Tell that to the working mothers who saw the doors of their childcare centres closed to them.

http://www.abc.net.au/news/stories/2008/12/10/2442837.htm

There is absolutely no need to explain to me how wasteful and fundamentally corrupt are any dealings with government agencies. I too have war stories that make the hair stand on end.

This isn't about a pissing contest between the relative goodness and badness of government and private industry. It's about keeping the debate honest.

And I'm afraid waste, incompetence and destructiveness are not the sole province of governments, as Peter Hume would wish us to believe.