“Markets fail. Use markets.”

"[M]arkets [do not] have to be optimal in order to be preferable to government intervention.
    "Instead, long ago I offered the aphorism 'Markets fail. Use markets.' That is, I readily concede that the market economy is not at some theoretical optimum. The question is what will lead to improvement. I believe that government intervention will often make things worse. Meanwhile, entrepreneurial innovation and creative destruction tends to solve economic problems, including market failures....
    "As a process, markets tend toward improvement, because business profits ultimately depend on satisfying consumers. As a process, government intervention is unreliable, for many reasons. The interests of government officials often diverge from the interests of voters. The disciplinary forces of competition and the profit-and-loss system are absent. The internal processes of bureaucracy tend to reward conformity and repression of innovation.
    "If 'market fundamentalism' is the belief that markets are perfect, then I do not know anyone on the libertarian side who is a market fundamentalist.... I wish that [economics professors] would spend more time discussing 'government fundamentalism,' which is what you are guilty of when you assume that government intervention consists of wise, technocratic solutions."

~ Arnold Kling, from his post 'Markets Fail. . .And Libertarianism Still Works, 10/16'

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