Posted 9:26 AM by Gene

Also in TCS (which given its recent contents may stand for something other than Tech Central Station):

If anything, the argument can be made -- as Daniel Henninger has -- that the response to Hurricane Katrina shows that the government is inherently ill-equipped to handle a great deal of the responsibilities that come with disaster relief and that many of those responsibilities should be outsourced to the private sector. Commenting on Henninger's article, law professor Stephen Bainbridge aptly sums up the quite cogent rationale behind such a move:

The capital, product, and labor markets give corporate managers and directors incentives to produce goods and services efficiently. What defenders of government regulation often overlook is that regulators are also actors with their own self-interested motivations. The trouble is that the incentives to which regulators and legislators respond are often contrary to the public interest. The incentives of legislators and regulators are driven by rent-seeking and interest group politics, which have no necessary correlation to corporate profit-maximization. Accordingly, government preparation for and response to disasters is likely to be driven by the political concerns of the governmental actors rather than the public good.

In sum, it may be time to try Adam Smith's invisible hand by outsourcing disaster relief.

We know how a certain kind of FREE-EN-TER-PRISE CON-SER-VA-TIVE LUUUUUUUUUVES MONOPOLIES. Is DOW 36,000 trying to MONOPOLIZE ON CLUELESSNESS?