Sunday, November 6, 2011

Fear of spontaneous order

We've all heard the game, six degrees of Kevin Bacon, where players try and find a connection between a seeming-less unrelated actor and Bacon in as few moves as possible. Something tells me if I took the workers names who created the computer I'm working on now I could probably connect everyone in the world in less than five moves. We are so interdependent that the idea that one component of the computer is made in China, another in California, using minerals mined in South Africa, doesn't really mean anything to us, it's just the norm.
I've always wondered if people who think such a system needs or must be centrally controlled wondered how all these people knew just when to make the computer and have it ready in the Apple store the day they arrived even before they even decided on buying it. Even a graduate of public education (no offense I'm one myself) would see the fallacy in such a belief. Of course, the computer was built without anyone in particular in mind because the actual beginnings of it began years ago in the production line. So what is so scary about this?
The "order" stems from rational self interest. When humans act in their long term self interest along with other such individuals we see order come about through market interactions. The inherent argument for central control of this process is the classic "lifeboat what ifs". What if so and so doesn't act in his long term interest and decides to poison the food his country exports or what if a leader in the Middle East decides to stop exporting oil to the U.S. They're always these ridiculous what ifs and despite this the market will correct the error made by the moron not acting in his long term self interest and they are punished. Can they happen, yes, is it a fatal error for the perpetrator? Yes.
The point is this process does not need to be steered the market will handle it.

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