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View Diary: Taxes, entitlements and regulations are essential to capitalism (26 comments)

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  •  A big difference between failed bizs & markets (5+ / 0-)
    Recommended by:
    jobu, ozsea1, opinionated, splashy, eztempo

    Market failure is a problem that the government had to deal with when the TBTF banks tanked the global economy.

    Government needs to pass legislation & regulations to keep markets from failing and society from picking up the cost.

    look for my eSci diary series Thursday evening.

    by FishOutofWater on Fri Dec 09, 2011 at 07:48:26 AM PST

    [ Parent ]

    •  Economics (0+ / 0-)

      "Government needs to pass legislation & regulations to keep markets from failing and society from picking up the cost."

      Legislation may keep things fair; it is extremely unlikely (and quite possibly  undesirable) that there is any sort of legislation or regulation that could or would prevent failures of markets. The brunt of such costs can and should be placed on the investors, as opposed to the society at large, but I greatly doubt that it is possible to have businesses that are allowed to succeed and fail, to profit generally from their success in the form of employment opportunities and taxes, but to entirely insulate the society at large from the costs of failures. But there certainly is nothing in the way of preventing the existence of entities that are TBTF.

      •  Agree wholeheartedly (0+ / 0-)

        No economic system is failproof, but the right leaders of a democratic government should develop, and sometimes have developed, ways to compensate.

        Elect the wrong leaders, and any economic system reverts to the interests of society's most influential and powerful citizens.

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