Harry Reid demonstrates why government can't run a business
An excellent op-ed from the Wall Street Journal yesterday details why the government and specifically the Obama administration can't run a business. Politicians and businessmen have different priorities.Politicians need headlines. And this means they have a deep need to do something ("Sen. Snoot Moves on Widget Crisis!"), even when doing nothing would be the better option. Markets will always deal efficiently with gluts and shortages, but letting the market work doesn't produce favorable headlines and, indeed, often produces the opposite ("Sen. Snoot Fails to Move on Widget Crisis!").
And responding to the news that Nevada's unemployment rate reached 10.6 percent, here's our own Sen. Harry Reid releasing a statement to get a headline. Weve been working hard over the last few months to take steps to create jobs, protect consumers from abusive lending practices and restore consumer confidence. Were just now starting to see signs that this is working. In recent weeks, casino executives have talked about the increase in hotel occupancy rates and a rise in convention bookings. In fact, earlier this month, major corporations including IBM and Southwest Airlines brought thousands of employees to Las Vegas for employee appreciation and business events.
Don't worry, Sen. Reid and the other politicians in Washington, D.C., and Carson City are working to solve our problems. Unfortunately, their intervention is what led to the problems in the first place.
While the coming months still present challenges, I will continue fighting to create good-paying jobs by making Nevada the nations renewable energy leader, keep struggling Nevadans in their homes and strengthen the national economy so people can have more money in their pockets to travel to Nevada.
What will be the results of these well-intentioned, government interventions? History shows us they will fail and we'll be stuck with the bill. In 1913, for instance, thinking it was being overcharged by the steel companies for armor plate for warships, the federal government decided to build its own plant. It estimated that a plant with a 10,000-ton annual capacity could produce armor plate for only 70% of what the steel companies charged.
When the plant was finally finished, however -- three years after World War I had ended -- it was millions over budget and able to produce armor plate only at twice what the steel companies charged. It produced one batch and then shut down, never to reopen.
