Size Matters

 

 

An aspect of the Cold War between the Russians and the Americans never discussed is the Americans' clear lack of faith in their assessments, their uncertainty over their analysis of communism. Marxism was more than viciously dictatorial and adolescently optimistic, it was self-destructively inefficient. The West believed their competitive system would consistently out produce the Russians. But they clearly did not believe that enough to allow the Russian system to complete its suicidal course unaided. The Americans opposed them at every turn, created conflict whenever it could and acted as if the Russians were a viable economic threat as well as a military one. They acted as if, allowed to grow, the Marxists would turn everyone's head and heart. More, they could win.

But the truth is that it could not win. Ever. It is inherently flawed. Even if people were magically changed to adapt to it, the economics just do not work. Even the massive and brutal Soviet central power could not keep the declining system from its demise for more than three generations.

New economic experiments will rise and their success will be measured as time goes by. Central planning of economies is the current fad but no one knows if they will be successful. (The current belief is that their secret meetings are run by smarter guys than ours are.) Indeed, the students of Russia completely missed the signs of the Soviet wreck until it was right in front of them so who knows what misery awaits the unsuspecting populous laboring under some New Great Idea. But there is a question that sits quietly at the current managed economy party: Size.

 

The trend towards smaller, manageable units of work and production is everywhere from business to the Marine Corp. Everyone is being asked to become smaller, more efficient, more adaptive. The large, unwieldy systems are being replaced internally and lean, reactive systems are emerging. These changes are not the result of theory but rather experience. Like biological evolution, success matters.

The only place where downsizing is not occurring is government. Top down central planning has one outstanding characteristic: Those in power, those "in the know," take power because they will not trust the economy to others. And they will not delegate authority. Instead they create gigantic templates for the working stiff to live by. The size of these programs flies in the face of all modern experience. Those who see value in the individual and his enterprise now act as if the size of their ideological opponents will carry the day when, if it does, it will be the only contemporary system to do so. If general contemporary observation is correct, the managed systems will fall by their own weight. Gravity matters.

The Affordable Care Act proposes to take over 16% of the United States' economy with 4.46% of the world's population (Germany, 1.1%, France and England, 0.9% each) and run it with full-time government officials, many whom have never worked in the private sector. The decision by the government to delay implementation of the employer's mandate section of the Affordable Care Act might mean a lot.