Dan Popp
Magical thinking
By Dan Popp
June 9, 2009

The U.S. government is dictating to businesses what products they can sell, where, to whom, and for what price. It has set lower limits on the wages of some workers, and upper limits on the pay of others. It has hired and fired employees of private companies, bullied decision-makers, broken contracts and ignored bankruptcy laws. It's pumping trillions of inflated dollars into the market, for things consumers refuse to buy when the money is under their control. And more "change" is on the way.

Rest easy, though: all of this unconstitutional power has been wielded to "help business," to "grow the economy" and to "create jobs."

How could American business possibly thrive in such an anti-market environment? Maybe you've wondered, as you hear each disastrous new policy announced, What in the world are they thinking?

In a pivotal scene toward the end of Ayn Rand's Atlas Shrugged, the government has co-opted most of the critical industries "for the common good," bringing the country to the brink of total economic collapse. The bureaucrats call a meeting with steel magnate Hank Rearden to tell him they're nationalizing his industry.

Rearden wants to know how they think it can work.

    "Have you anything left to loot? If you didn't see the nature of your policy before — it's not possible that you don't see it now. Look around you. All those damned People's States all over the earth have been existing only on the handouts which you squeezed for them out of this country. But you — you have no place left to sponge on or mooch from. No country on the face of the globe. This was the greatest and last. You've drained it. You've milked it dry. Of all that irretrievable splendor, I'm only one remnant, the last. What will you do, you and your People's Globe, after you've finished me? What are you hoping for? What do you see ahead — except plain, stark, animal starvation?"

    They did not answer. They did not look at him. Their faces wore expressions of stubborn resentment, as if his were the plea of a liar.

    Then Lawson said softly, half in reproach, half in scorn, "Well, after all, you businessmen have kept predicting disasters for years, you've cried catastrophe at every progressive measure and told us that we'll perish — but we haven't."

Rearden persists in seeking the answer to a question the central planners don't understand: "What are you counting on?"

    "It's only a matter of gaining time!" cried Mouch.
    "There isn't any time left to gain."
    "All we need is a chance!" cried Lawson.
    "There are no chances left."
    "It's only until we recover!" cried Holloway.
    "There is no way to recover."
    "Only until our policies begin to work!" cried Dr. Ferris.
    "There's no way to make the irrational work." There was no answer. "What can save you now?"
    "Oh, you'll do something!" cried James Taggart.

When you peel back the layers of the onion to discover the core of this unshakeable belief in policies that have blighted entire continents, this is what you might find.

"Oh, you'll do something."

That name for this is "magical thinking." The scientist in the old cartoon has filled his blackboard with an equation. In the middle of the scrawl, in brackets, is the phrase, "Here a miracle happens."

Barack Obama is surely the Monarch of Magical Thinking. He believes that diplomacy without force to back it up will [abracadabra!] melt the hearts of foreign dictators. He admits that the debt he's amassed on our grandchildren's behalf is "unsustainable," but says that the remedy is [twitch nose three times] to have the government absorb the entire nation's health care costs. And he, like the sniveling nitwits of Rand's atheistic prophecy, believes that rewarding marketplace failure and punishing success will [here a miracle happens] create jobs.

After 900+ pages, the readers of Atlas Shrugged have learned that running a successful steel mill or railroad is far from easy. But the bureaucrats are clueless. Their faith that the selfish industrialist will (somehow) pull their bacon out of the fire once more is only possible because of their ignorance.

Naiveté is crucial. Karl Marx, the self-appointed champion of the worker, never set foot in an industrial plant. His present-day followers grow in places like academia, insulated from business realities and knowledge.

    [Rearden] was seeing the progression of the years, the monstrous extortions, the impossible demands, the inexplicable victories of evil, the preposterous plans and unintelligible goals proclaimed in volumes of muddy philosophy, the desperate wonder of the victims who thought that some complex, malevolent wisdom was moving the powers destroying the world — and all of it had rested on one tenet behind the shifty eyes of the victors: he'll do something!

In other words, there is no need to look for a conspiracy. Human stupidity can wreck civilization all by itself.

Enterprise requires things like stable and well-enforced laws, reliable currency, unobtrusive regulation, the opportunity to reap profits, and even exposure to losses. When government puts sand in the pistons and cuts the lines, there is no mystical "something" that can make the engine go. When Big Brother takes over business, business is over.

A young niece of mine asked for and received a magic kit for Christmas. After she had read some of the instructions, she blurted out, "This isn't magic — these are just tricks!"

Unfortunately, wide-eyed irrationality isn't confined to the Left. I've heard usually-thoughtful radio hosts reassure listeners that, "The American economy will bounce back; it always has." But the conclusion doesn't follow from the premise. Only if we were to do the same things we've done in the past, under the same conditions, could we be fairly certain we'd see the same results. New variables, such as unprecedented levels of debt, would void the equation.

One of Rand's empty suits said, "You businessmen have kept predicting disasters for years, you've cried catastrophe at every progressive measure and told us that we'll perish — but we haven't." This is the logic of a toddler. Damage can be cumulative. The idea that "all things continue as they were" (see 2 Peter 3:4) eventually fails.

And she said, "The Philistines are upon you, Samson!" So he awoke from his sleep, and said, "I will go out as before, at other times, and shake myself free!" But he did not know that the LORD had departed from him. — Judges 16:20, NKJV

America may indeed recover from her follies; but the confidence that she must recover no matter how badly government gums up the works, is based on magical thinking — not history.

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© Dan Popp


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