Congress can't pass a real budget. But politicians think they can spend smarter than you?

Some important lessons about political economy seem to have to be relearned from time to time. One of them is that markets are superior to politicians, intellectuals and bureaucrats in productively allocating capital.

Distrust of markets is a defining, and animating, characteristic of the left....

...The right has historically* trusted and defended markets. But, of late, distrust of markets is being increasingly expressed there as well....

...There is an enterprise, the federal government, that members of Congress manage directly. It spends in the vicinity of $200 billion to $250 billion a year on long-term physical assets, such as buildings or fighter jets.

Yet it is borrowing more than $1 trillion a year. So, it is imprudently borrowing roughly $750 billion a year to cover operating expenses.

It recently enacted what passes for a budget in Congress for the fiscal year that actually began more than two months ago. The Medicare hospitalization trust fund is projected to start running a deficit in 2026 and the Social Security trust fund in 2035. Yet there is not even any discussion in Congress regarding doing something about it.

And these are the people who want to direct private sector investment decisions? And deliver lectures about short-termism?

Friedrich Hayek famously called the claim that politicians, intellectuals and bureaucrats could better allocate capital than markets “the fatal conceit.”

I don’t know that it’s fatal in all of its manifestations. But it is certainly a conceit.

* Actually, historically, prior to the late 1800s, the left and right help positions opposite what they are today, Democrats stood for free markets and Republicans for fixed or managed markets. They switched positions for just over a century. Now both stand for fixed markets.