B
Bob Eld
- Jan 1, 1970
- 0
John Larkin said:Except that it was Clinton who pushed, and signed, the dereg bills
that led to this mess.
John
Yes, Clinton was partly responsible for the mess but the main Character was
Reagan who began the rush to deregulation. Bush and the various congresses
didn't help much either.
Laissez-Faire Capitalism is inherently unstable with built in positive
feedback mechanisms and delays and operates much like a chaotic oscillator.
It requires regulation and control to stabilize it. When we take off the
controls it begins to swing wildly as we can plainly see now and has done so
many times in the past.
The new deal controls kept it reasonably stable up to the 1980's. Several
bubbles have been positive swings while what we are now seeing is the
greatest negative swing since before that time.
One positive feedback mechanism is easily seen in the fact that as people
lose jobs, they spend less money causing factories to lower output who then
layoff people, and around it goes. There are dozens if not hundreds of such
loops in the system all with associated time constants. The overall
interaction is a chaotic system that runs wild if left unchecked and
unregulated.