In 1974, a group of students wrote The Incredible Bread Machinewhich was a rewrite of a 1966 book by Richard Grant that was a study of capitalism, freedom, and government interference. The 1974 rewrite promoted the ideas of personal and economic freedom. One feature of both versions is a poem about a man who invents a machine that produces bread cheaply. In time, he is punished by the government for being too successful. Abundance leads to scarcity and starvation.
This book is relevant because the new progressives are intent in dismantling the bread machine—capitalism—and replacing it with “democratic socialism”. The name is intended to imply that private enterprise will continue to be the means of production but with some help and guidance from a beneficial government.
Make no mistake, those who embrace the Green New Deal—GND–want to take us down the road that has always produced misery for the many and affluence for the few. Those like Senator Warren, Bernie Sanders, or Alexandria Ocasia-Cortez may have noble motives but they are built on a foundation of illusion. The government they want to create will not be run by angels who are motivated only by what’s right and best for the nation, it will be run by humans who pursue their own self-interest and respond to incentives that flow from laws and regulations that too often are influenced by those—crony capitalists– with the wealth and influence to shape them to their advantage.
Supporters of the Green New Deal have convinced themselves that the economy can be run better by the elites through centralized decision making than by the many dispersed parties that comprise our market economy. However, as Hoover Institution economist Thomas Sowell once observed, “the first law of economics is scarcity and the first law of politics is forget the first law of economics”.
It is obvious that a lot of people, especially in the media, have been seduced the GND promises of healthcare for all, free tuition, and miracle energy that has no externalities. They have been aided and abetted by economists who promote Modern Monetary Theory in a way that makes GND proponents think that it is possible to turn on the money printing presses as a way to fund their fantasy promises easily and painlessly.
As Milton Friedman is known for observing, “there’s no such thing as a free lunch.” His work also showed that when government enables too many dollars to pursue too few goods, inflation is guaranteed. There is no monetary trick to avoid that outcome.
Before the GND proponents and supporters do actual damage, they would do well to read Friedrich Hayek’s The Road to Serfdom. The advocates of the GND contend that it is aspirational but Hayek demonstrates that the means by which ideals are achieved means the “abolition of private enterprise, of private ownership of the means of production, and the creation of a system of “planned economy” in which the entrepreneur working for profit is replaced by a central planning body.” He wrote this in 1944.
The bread machine is in need of repair; not dismantling.